According to the complaint, the “Levitte International” online ad campaign ran from June 1, 2007, through August 18, 2007, and received 202,528 impressions from parked domain pages – placeholder Web pages with auto-generated links related to a pre-determined search keyword or the hosting domain name. (…)

Despite Google’s semantic technology, the complaint states that the ads Levitte placed just didn’t work. Out of the 202,528 impressions* on parked domain pages, Levitte got 668 clicks and zero conversions.

Levitte’s ads also appeared on error pages, through Google’s AdSense for Errors program. With 1,009 impressions, 25 clicks and zero conversions, he had little to show for it.

A commenter named MrWells on Digg writes, “As an advertising company, Google should absolutely be liable for BS ad placement.” Someone else nicknamed KjcDude remarks “I can’t see [Google] loosing this one. The guy really has no ground to stand on.”

Whatever the outcome of this particular case, I think Google’s parked domain ads program is one of the more shady neighborhoods the company got themselves into. On the one hand Google is very careful when considering to add advertisement to some of their services (like ad-free Google News), and their web counterspam team is trying to tell people to add value to webpages… and on the other hand Google themselves profit from and support zero-value pages by domain brokers who occupy large parts of the domain names space.

[Hat tip to Yusef R. and Digg!]

Comments

Lets take a little look at why they might have done this.

Google Is A Business

It is actually quite a large business, and each division within a division is probably accountable for their own earnings. The Adsense referral program for new business is probably individually accountable.

Current (Old) System Earnings

Based upon quarterly and yearly reports, Google on average pay publishers only 29% of advertising revenue. Larger publishers probably get a larger piece of the action, so it is quite possible a new publisher only receives 25%

For every dollar earned, Google receive $4

Referrals Changes the Math

For the first $5 of earnings in 6 months, they pay a referral fee of $5, thus Google only make 50%

If a publisher earns $100 in 6 months, Google pay a referral fee of $250, thus of the $400 they receive in advertising revenues, they pay out $350… plus there is a bonus

For 25 people who make $100 within a 180 day period you get a bonus payment of $2000, that is $80 per person

In theory, Google could pay out $430 for every $400 received

This is potentially a loss leader…

In practice only a small number of people make it even to $5, and even less to $100 within 180 days. Darren mentioned in his article that he has never achieved the bonus, though if he comes close, those $250 fees for the ones that do make $100 must be reasonably lucrative.

The New System

The Adsense Team are reverting back to $100 for $100 earned in 180 days with no bonuses.

Also the countries are now restricted to North America, Latin America, or Japan – for the referrer.

What Darren and Shoemoney didn’t pick up on is that is existing referrals don’t qualify by the time this is introduced, it seems like you will only receive compensation based upon the new structure, not the old. That is significant if you were in some way paying for advertising based on anticipated earnings over 6 months based upon prior statistics.

Gaming Adsense With Referral Hydras

For me the obvious reason why they would restrict this to only partners in certain counties is fraud, or gaming the system. Google is made up of regional offices, so it would be hard to separate Eastern Europe from the rest of Europe, or Australia from others in the Pacific region.

If you look at this from the point of view of a person in a low income country, there is a potential $430 that could be earned instead of $100 for the clicks you might receive on a website you own that has reasonable traffic, all you need is new Adsense accounts.

Here is how such a system could work

1. Find 25 people who would be interested in earning $100 from Google just for providing their personal details

I can’t honestly imagine this wouldn’t be hard in many developing countries

2. Place the advertising units from those referrals on your own websites such that they will earn $100 within a month
3. The person referred gets $100 in Adsense earnings
4. You get to cash $330 instead of $100

Rinse and repeat

If you don’t want to give $100 away, you could always set up shell companies., but I don’t think it is really worth the effort, it would be easy to find people willing to earn $100 for doing nothing.

If you are just doing blackhat stuff this provides an unlimited supply of fresh Adsense accounts, and you earn everything 100% "legitimately" as just the referrer.

Can It Really Be That Many People Doing This?

If you were a slightly shady blackhat, wouldn’t you like to keep your Adsense earnings 100% clean, and earn 3x as much?

Especially if you were living in a slightly poorer country, or had contacts in one… China, Russia..

Would This Hurt Google Financially

Certainly if it got out of hand. Most of these referrals would earn their $100 and then drop off the face of the earth after they cached their checks.

Could It Be Another Reason?

I am sure growth rates outside 1st World countries are fast enough without the financial incentive for referrals, and there is always a question of scaling up support costs, and the lack of competitive advertising.
With low paying clicks outside the English speaking world, those that are active Adsense publishers are often more inclined to experiment with more grey or blackhat methods, because they don’t necessarily have to create their own content to make money.

Too Good To Be True

I always looked on the referral program to be full of holes

• You don’t know who you referred so you can’t help them, unless it is by arrangement
• You can’t honestly declare you make money by referring people, it is against the referral program terms, though they encourage word of mouth marketing.
• The reporting was always a little on the basic side
• The time period for qualification was far too long and it seems that has come back to bite people

For a negative change such as this, you would expect a full 6 months notice, or for referrals who qualify within 6 months to be paid at the old rate.
For referring publishers outside North & South America, and Japan, they are effectively being told that all those referrals they have made that haven’t quite earned $100 by the end of January will not be paid.

I am glad I haven’t promoted Google Adsense for 2 years.

Comments

*Originally published at AndyBeard.eu

As put by Google, the reason for dropping this feature is "not been performing as well as we had hoped, and in the coming weeks the feature will be retired." Earlier, Google launched this feature back in September 2005 and many advertisers and publishers had high hopes for it. At that time Dave Taylor in a blog post, said "I think it’s quite significant, actually, for two reasons: one, it demonstrates that the Google AdWords system is being extended to allow advertisers to bid on specific Web sites."

However, it was not able to meet the expectations Google set out for this program. Google said, "As the AdSense product evolves, we occasionally re-evaluate aspects of the product to make sure they are performing well for our publishers and meeting our goals. We found that the Onsite Advertiser Sign-up feature was under-performing, and so we have made the decision to focus our efforts on features that we believe will drive the best results for publishers."

Now any direct clicks on those "Advertise on this site" link will be directed to the AdWords sign-up page.

Comments

Tag:

The AdSense service will place contextually relevant ads next to CNN.com content. Advertisers both small and large will be able to target CNN.com specifically and connect with content and traffic. Under the terms of the deal, Google will be the exclusive provider of auction-based text advertisements on CNN.com.

"At CNN.com, our mission is laser-focused on providing up-to-the-minute news and information to our users," said David Payne, senior vice president and general manager of CNN.com.

"Our new relationship with Google will deliver relevant ads to our users, enhancing their overall experience on CNN.com. We look forward to a successful partnership."

Google offers publishers a way to monetize their content by connecting them with numerous advertisers. Ad formats include text, image and video, AdSense allows advertisers to communicate their message and allows publishers to customize the look and feel of their sites.

"CNN.com is an important and respected news source, and we’re pleased to enhance the reader experience through the targeted placement of relevant ads," said Marc Leibowitz, Google’s director of strategic partnerships.

"By connecting CNN.com to our valuable base of advertisers, our AdSense program provides an effective and efficient way to monetize quality online content, ultimately benefiting readers, advertisers, and CNN.com."

"We’re happy to extend this relationship and value partners like Google whose technology enhances washingtonpost.com for both our readers and our advertisers," said Caroline Little, CEO and Publisher, Washingtonpost.Newsweek Interactive.

Readers will see results through Google search and see relevant Google ads on washingtonpost.com’s Web pages when they do a Google search directly from the site.

Google provides publishers with a way to monetize their content by connecting Google’s large network of advertisers with Web sites in the AdSense network. AdSense allows advertisers to communicate their messages and gives publishers a way to customize the look and feel of their sites. Ad formats include text, image and video.

"We’re pleased washingtonpost.com is extending their AdSense agreement based on the value they have seen from the program to date," said Marc Leibowitz, Google’s director of Web syndication partnerships.

"Combining both contextual and site targeting, we think AdSense is the most effective and efficient way to monetize online content. Our continued relationship is a testament to our efforts to make the program a success for washingtonpost.com."

Product #1 is, in this case, Google AdSense.  Comm led a session called “Contextual Advertising Options: Clicks Equal Cash,” and first mentioned the massive amount of money flowing through AdSense – an estimated $14 billion this year.  The author of “The AdSense Code” then complimented AdSense’s design and video ads.

Yet Google’s not perfect.  Comm, whose ClassicGames.com was sold and is now called Yahoo Games, is concerned about unknown payout percentages, Made for AdSense sites, and accounts being closed for invalid clicks, so he moved on to discuss the Yahoo Publisher Network (YPN).

Comm recommends using YPN if you are banned from AdSense, if your AdSense click-through rate is low on a page, or if your YPN earnings per click are higher.  Otherwise, well . . . he prefers ol’ Google.

One more option, however, is Chitika.  Comm notes associations between Chitika, Shopping.com, and PriceRunner, and thinks that people should consider using the service if their pages are product-related.  He also gives fair warning that some family-friendly sites have been provided with porn links, though Chitika has recently conquered this problem.

So there you have it.  Good luck with your comparison shopping.

Bo Majewski, a software engineer at the Mountain-View based company, says, “We are going to make AdSense available for maps.”  You can’t get more straightforward than that, yet the details and qualifications are also important.  Angus Kidman of ZDNet Australia captured some of them.

“AdSense won’t automatically be added to applications which use maps,” writes Kidman, “but developers will have the option of including it.”

Then back we go to Majewski for a fuller explanation.  “You have to sign in and you have to create a special AdSense manager,” Majewski says.  “You tell it how many ads you are comfortable . . . and it displays them.”

If you’re wondering what the final product might look like – my imaginary set of instructions at the beginning of this article is probably pretty far off base – Read/WriteWeb’s Josh Catone constructed a likely-looking mockup.

On a side note, has anyone else noticed that Google just hasn’t been able to leave maps alone for this past week or so?  Google Earth got a layer of sound and another one relating to seabeds.  Google Maps got Street View.  And now this.  I’m not complaining, but it makes you wonder just how much coffee a certain team in Mountain View is drinking.

Time Warner (TWX) has learned Zen and the art of advertising from its billion-dollar partner, Google (GOOG). When its cable division becomes a standalone company, it could use AdSense techniques to provide advertisers with a way to place their ads on the TV screen.

Similar to Google’s approach to online advertising, Time Warner Cable (TWC) would auction off placement on channels related to vertical industries, like automotive or home improvement. Advertisers would bid on placement, with the highest bidders winning the spots available.

News of the prospective ad auction made the rounds in a Reuters report:

Part of the blockbuster deal Google made with Time Warner in December 2005 included sharing knowledge on advertising. With Time Warner Cable (TWC) comparing its proposed TV ad auction to AdWords, maybe that was part of the knowledge-share.

TWC has a distinct advantage through the voluminous database of customer information it has collected from subscribers. That should permit the company to best deliver an advertiser’s message to its most desired demographic.

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David Utter is a staff writer for WebProNews covering technology and business.