Believe it or not, what you do and don’t know about how Google makes money affects your SEO.
Jump ahead to:
What is the Point of this Article?
If you’ve paid any attention to SEO over recent years, you probably know that:
- People figure out tricks to game the system to rank their websites.
- Google updates the algorithm periodically to undo ways of gaming the system that become really popular, and occasionally de-ranks huge numbers of sites overnight.
And you’ve probably heard from some:
- There are tricks that work reliably if only you know them (generally for a fee you can learn them).
- Google penalizes/punishes websites that (in their eyes) game the system.
- Google unfairly prioritizes its own products and services in its rankings.
- And more….
However, when you understand what the business model of Google is, which is to say how they make money, you realize that while there might be grains of truth in the negative things people say about Google’s search algorithm, most of it is off target.
Please read on, and take your time, as I start at the 50,000-foot level, at a time before Google even existed. This is because Google’s business model is not new.
What’s new is the scale at which they do it.Check out our Digital PR Platform
Advertising as a Business Model
Many people, when they consume some form of advertising-supported content (TV, radio, whatever), like to think of themselves as “the customer” as they think of themselves as “consuming” the programming.
But think for a minute about how the money flows.
When we enjoy advertising-supported content, we’re not paying for it, the advertisers are. That clearly makes them the “customer”, and the station or publisher selling the advertising is the “supplier”.
But if the advertiser is the customer, and the station/publisher is the supplier, what are we?
We, my dear friends, are the product.
The advertisers pay the stations and publishers in order to have access to our attention, which they wish to use to sell us stuff.
A law professor at Columbia University named Tim Wu coined the very apt phrase “The Attention Merchants”.
He has written a book titled The Attention Merchants (image below), and in the spirit of full disclosure, I wish to state that while it is on my reading list, I have not yet read it. But I get the idea, as I’m sure you do too.
Attention merchants are the people who get our attention via various means, then sell it to others who want to sell us products and services.
The idea is about 100 years old, with the first radio commercial airing in August 1922.
The commercial interruptions we’ve all come to hate started to fund the building of radio transmission facilities. Later the idea was expanded to broadcast TV. Even cable TV without commercials didn’t last long. Commercials proved not only to be a good way to cover costs but to make some serious money as well.
Then the Internet happened, and search engines started offering us their services so we could better find interesting stuff.
Shortly later his friend Sergey Brin joined him in this project as the math was difficult and Page needed help.
They needed data with which to test their ideas and their math, and as the Internet was (and still is) a collection of documents that all “cite” each other, they used the document repository known as the World Wide Web as their source of data.
They soon realized that using web links as “votes of confidence” in order to calculate the “value” of a web page produced really good search results.
Anyway, a research project named “BackRub” became a company named “Google”, and the rest is history.Check out our Digital PR Platform
Google vs Others
The basic business model of Google is just like that of radio and TV stations. Get our attention, and sell it to advertisers.
The radio and TV stations do it with programming.
Either by creating shows people want to listen to and watch or by buying shows others have created.
Google gets our attention by showing us search results we find useful, but from that point on, the business model is the same.
Now that Google has our attention, it’s theirs to sell.
While it’s true that Google is “just” another attention merchant, they are also one of the most successful attention merchants in the history of human civilization, if not THE most successful.
Now let’s review some statistics on advertising spending worldwide and in the US.
2021 Total US TV Advertising Spending: $65 Billion
2021 Total US Radio Advertising Spending: $13.9 Billion
2021 Facebook Advertising Revenue: $114.9 Billion
2021 Google Advertising Revenue: $208 Billion
Now let’s run a few ratios based on the above numbers. In 2021…
- Google took in more than three times as much ad revenue in 2021 than the entire US-based television industry.
- Google took in almost 15 times as much ad revenue in 2021 as the entire US-based radio industry.
- Google took in almost twice as much ad revenue in 2021 as the other online heavy hitter of ad sales, which is Facebook.
- In 2021 Google took in 26.9% of all advertising spending, worldwide.
Let that last one sink in. One company took in slightly more than one-quarter of all advertising money spent in the ENTIRE WORLD in 2021.Check out our Digital PR Platform
What Google does that is the same
Google is very good at getting our attention, then selling that attention to people who want to sell us stuff. Every advertising-supported business does this. If they don’t do it, they go out of business.
What Google does that is different
Google does not generate any significant content. The only content Google produces are documents they publish on their websites, just like everyone else, but that is a tiny sliver of the content they make available to us.
Whereas most advertising-based businesses are built on either producing content for their audience or buying content produced by others, Google aggregates content produced by others and presents it to people in search results.
That is a very significant difference.
Again, What is the Point of this Article?
Now that you understand what business Google is in (and how important this business model is to them), you have a perspective with which to understand why Google continuously updates its search algorithm.
In order for Google to continue to be paid by advertisers, they’ve got to keep our attention.
In order for Google to continue to keep our attention, they’ve got to keep providing us with search results we find helpful.
By continuously improving the quality of the search results over time, they further cement our collective thinking that Google is synonymous with Search.
When you look at what they do from that perspective, all their efforts to prevent people from gaming the system and their constant updating of their search algorithm suddenly make sense.
The more we like their search results, the more we use Google and the more money they make.
So what does Google call their efforts to keep us coming back for more?
They call it Content Quality.
If you want your website (or the websites of your clients) to rank higher, you MUST understand how Google defines content quality.Check out our Digital PR Platform
To learn how Google defines Content Quality, you should read their rather long and somewhat boring document titled Search Quality Evaluator Guidelines.
I’ll do a follow-up post on this topic later, but for now, the thing to understand from this article is:
- Google is rather obsessed with the concept of content quality.
- Google has published a 167-page document that spells out in great detail how they define content quality.
- If you want your website to rank, you’ve got to publish content per their rules.