Many surfers say Web engine ads are blurring the line

06/12/2003

By DOUG BEDELL / The Dallas Morning News

At a recent seminar on Internet search techniques, expert Danny Sullivan was startled by one young man's idea for culling the most relevant results from Google.com.

"He said, 'I know everything's sold, so I always skip to the third page of results,' " recalls Mr. Sullivan, editor of SearchEngineWatch.com.

"I said, 'But the most relevant results on Google are numbers 1 through 10, and they aren't sold,' " Mr. Sullivan says.

"That was a really telling moment for me."

The young man is not alone in his confusion. Over the last two years, search engines have morphed from trusted, no-nonsense Internet indexes into a successful advertising vehicle.

Banner ads have been largely replaced by links to advertisers that sometimes appear within search results. Businesses often pay fees to be included in a search engine's database. Or they enter daily bidding wars to buy up keywords that will display their links when Web searchers enter queries.

And, according to consumer groups, it is not always apparent which are ads and which are "pure" search results.

Last year, Consumer WebWatch asked 1,500 online users whether they knew that some search engines were paid fees to list sites more prominently in search results. Sixty percent said they were unaware.

After another consumer group, Commercial Alert, filed a complaint with the Federal Trade Commission, the government issued a warning letter to major search firms, urging them to clearly label and separate advertising from "editorial" search results. The commission also said that if paid-for links were injected into editorial search results, they must be "disclosed clearly and conspicuously to avoid the potential for deception."

Many experts and analysts agree that search engines, in general, have made great strides in the past year at marking which results were paid for. But a follow-up study by Consumer WebWatch, due out this month, shows residual problems.

"Now they all say technically they do disclose, but the consumer still doesn't know what it all means if they do stumble upon these disclosures," says Leslie Marable, a researcher for Consumer WebWatch, a project of Consumers Union. "Some of the disclosures are vague."

No standard exists for labeling paid-for content. Each search engine did its own studies of user behavior, then decided which terms it would employ.

The FTC specifically warned that displaying paid results under headings such as "Web Directory Sites," "Results," "Matching Sites," "Start Here" and "Reviewed Web Sites" would not pass muster.

In their place, most search engines today tack a "Sponsored Link" or a rough equivalent onto paid-for links.

However, at the First National Summit on Web Credibility, conducted in April by Consumer WebWatch, Ms. Marable and other participants questioned whether "sponsored" is direct enough for users to understand. Why not use a more straightforward label, such as "paid ad" or "advertising?"

Many of the financial deals hinge on getting users to click on paid-for links, they say. Per-click payments are made regardless of whether users understand that they were venturing into the advertising realm.

Of course, some people are using search sites to shop. Many actually welcome advertising when a purchase is their goal. A detailed behavioral study of how 17 Internet users responded to search engine results pages showed just that.

"That's probably because when you go to a store, you expect bias of some sort," she says. "Commercial searches were not a shocker, but when searching for information, it did disturb them."

Mr. Sullivan, who conducts seminars on search advertising techniques, said: "I think people feel they ought to be able to trust a search engine. There is this sense that when I do a search, I'm supposed to be getting answers that make sense, not just answers that are there because somebody paid for them to show up."

The search engine landscape is a product of tumultuous change over the last three years. When search sites took flight in 1994, they concentrated on developing the best "spiders" – software programs that could scour public Web pages, collect keywords, then create searchable databases. Advertising was virtually nonexistent.

In 1998, everything changed with the entry of GoTo.com, which sold result placements. GoTo became Overture Services, which energized the field when it began selling paid listings to Netscape Search, then AOL Search.

As banner ads crumbled from user apathy, the Overture model grew attractive to search companies thirsty for an income stream. By the end of 2001, just about every search engine used paid listings. Often these were presented under nebulous headings like "Featured Listings" or "Partner Search Results" that didn't clearly signal paid-for placement.

Companies such as Inktomi joined the fray. In 2000, Inktomi began serving its partners with a "paid inclusion" program. For a yearly fee, Inktomi would guarantee businesses that their Web pages would be indexed more often than those of competitors that didn't subscribe.

The stakes have become huge. More than half of all Internet users use a search engine every day, making it the most popular activity behind e-mail. However, users rank searching above e-mail when asked which is more important.

A study by Anderson Consulting established that 65 percent of Web shoppers use search engines to find the retail sites on which they make online purchases. And numerous studies have shown that search engines are the No. 1 way consumers find new Web sites.

Meanwhile, the sources of search results have undergone a consolidation. Many Web portals decided it was cheaper to buy search results from companies such as Google, then make separate deals to display paid listings from Overture and Inktomi.

As a result, consumers often see the same results on multiple sites. In many cases, only the advertising is different.

Search engine companies tinker with disclosure and labeling, even as the FTC continues to monitor their efforts to self-regulate.

"We'll see whether the FTC follows up on this and conducts enforcement actions against companies that are not following the rules," says Gary Ruskin, executive director of Commercial Alert, filer of the formal complaint.