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Is this search link an ad?

Example of paid advertising on Google.

Let’s search for something online -- say, ‘hi-top fade’ or ‘breakfast cereal.’ We’ll use Google, Yahoo, DuckDuckGo, Blekko, whatever. Results pop up at the top of the page, and the bottom of the page, and maybe along the right-hand column, too.

Some of those results will be based on relevance -- the result of complex algorithms. Some of the results come up because they are paid or sponsored advertising. And the Federal Trade Commission wants to make sure that we, the web-surfing public, actually know the difference.

The last time the FTC issued formal guidance to make sure search engines clearly communicate the difference between paid search results, and 'natural' or 'organic' ones, was in 2002. That’s like a century in Internet-advertising-time. And advertisers have been busy adapting their online pitches to multiple search engines, screens, and devices.

“Over the years actually it’s become harder to distinguish advertising from natural results,” says Mary Engle, associate director for advertising practices on the consumer protection staff at the FTC. “It used to be there would be clearer background shading, and that shading got so bland that you couldn’t even see it on different computers, different screens.” The labeling copy has also gotten muddier, says Engle. “It may say ‘sponsored links,’ or ‘ads,’ in such tiny fonts that you can’t even notice it.”

This week, Engle’s department issued updated guidance in the form of letters to 24 web-search companies. They include seven general search sites -- Google, Ask.com, Bing, AOL, Blekko, DuckDuckGo, and Yahoo! -- and 17 heavily-trafficked specialty sites focusing on specific consumer sectors such as travel, shopping, or local business. The FTC has instructed the search sites to more clearly distinguish ad-driven results from natural ones, using visual cues like color-shading that displays consistently on multiple devices (including mobile devices), as well as borders and labels.

Aaron Wall runs SEO Book.com, a search-engine-optimization firm in the Bay Area. He conducted an online survey in which he showed web users a sample page full of search results.

“They looked at it for like 10 seconds, and it had three ads front and center that were pretty big,” Wall explains. Half of the respondents didn’t see any ads, or were unclear if any ads were present. What they saw was basically undifferentiated search results.

And Wall says advertisers are getting ever-wilier. They’re now utilizing something called 'dynamic keyword insertion' to let them personally customize their ad copy, using words the consumer just typed into their web search. “You see the ad copy and you think someone wrote that,” says Wall. “But some of the ad copy itself can be driven automatically based on the keyword list, and whatever the user searches for, there's a placeholder and that gets included.” He says once you click to the advertiser’s site, the page may be further customized to market in a more targeted way, based on those keywords.

Yankee Group technology analyst Carl Howe says, however much we might want to keep advertising and search separate, they’re bound at the hip.

“If there were no advertising along with your search results, you probably wouldn’t have a Google to go to today,” says Howe. “They make 98 percent of their revenue from advertising, which is mostly attached to search. So it is a bit of a challenge to try to make the paid results very clear, while at the same time not killing the goose that lays the golden search eggs.”

About the author

Mitchell Hartman is the senior reporter for Marketplace’s Entrepreneurship Desk and also covers employment.

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