Posts tagged ‘Search Engine Optimization’

Have Reputation, Will Sell – The Market for Links

One day a few years ago I asked my son if he had homework. He told me not to worry because he had a “homework pass”. In other words, he had earned a pass from his teacher to use to cancel out (excuse) a missed homework. I immediately outlawed that practice for him. Missing homework means missing material needed for learning. A few weeks later he told me that his friends were wanting to “buy his homework passes” and is it right to sell them? Very quickly I learned about a market that had developed at his middle school whereby kids were buying and selling homework passes! It is amazing how fast a market develops around a good idea – even when that idea hurts the integrity of the very system in which it developed.

One of the things that fascinate me about Google’s PageRank is the fact that it was basically created to mimic the practice in academia of establishing professors’ research reputations. Professors in research institutions build their reputations by publishing in peer reviewed journals. Their goal is to make a significant contribution to the literature, and it is that literature which provides a foundation for their works. In other words, their works build on the works of others. It is a responsibility to acknowledge the contributions of others to your work. It is an honor to be ‘cited’ in someone else’s work – especially if that person has a better research reputation than yourself or publishes in a high quality journal. This is how you build an academic reputation. Google’s PageRank does essentially the same thing for websites. It evaluates a site not only by its URL and the relevancy of its contents to the search term, but also by the quality of its incoming links – or the number of links from other sites that link back to the site, as well as, the number of links that link back to those sites. If a site with higher quality backlinks (or a higher PageRank) links back to your site, this is a nod of approval of the site.

Thus, the emergence of a market – the purchase of reputation through the buying and selling of links. The sellers? Those who have established reputations and high PageRank. The buyers? Those who are just getting on the web and are looking for ways to increase PageRank. And then there are the swappers - those that follow the axiom “if you scratch my back, I’ll scratch yours”.

If you have a website, at some point you will be contacted by someone wanting to be your “link partner” or someone wanting to “buy text links” on your site. Is this a good idea? The jury is still out for me on this. My first instinct is that it is a free market. Let freedom ring. Just keep in mind that many of these unsolicited emails are simply suspicious or even dishonest marketing tactics. You are likely to pay money for nothing. But even for those that are legitimate, freedom goes both ways. Let Google protect the integrity of their search system as well. Matt Cutts (Shout out to him: Go Big Blue!), head of Google’s Webspam Team, seems to take a lot of criticism for his staunch views on protecting Google’s search engine integrity. He has this to say:

Google (and pretty much every other major search engine) uses hyperlinks to help determine reputation. Links are usually editorial votes given by choice, and link-based analysis has greatly improved the quality of web search. Selling links muddies the quality of link-based reputation and makes it harder for many search engines (not just Google) to return relevant results.

He goes on to suggest the penalty:

Reputable sites that sell links won’t have their search engine rankings or PageRank penalized–a search for [daily cal] would still return dailycal.org. However, link-selling sites can lose their ability to give reputation (e.g. PageRank and anchortext).

And more from Matt at Google’s Webmaster Central Blog:

If, however, a webmaster chooses to buy or sell links for the purpose of manipulating search engine rankings, we reserve the right to protect the quality of our index. Buying or selling links that pass PageRank violates our webmaster guidelines. Such links can hurt relevance by causing:
- Inaccuracies: False popularity and links that are not fundamentally based on merit, relevance, or authority
- Inequities: Unfair advantage in our organic search results to websites with the biggest pocketbooks.”

And more from Google:

“Not all links are equal: Google works hard to improve the user experience by identifying spam links and other practices that negatively impact search results. The best types of links are those that are given based on the quality of your content.”

So it is safe to say that Google does not condone outright link-buying for the sake of raising PageRank.

However, Google ironically promotes link buying in some ways. For example, to improve your ranking in search engine page results, Google suggests that you “Submit your site to relevant directories such as the Open Directory Project and Yahoo!, as well as to other industry-specific expert sites.” This draws fire from critics because these directories may charge a fee for listing. Essentially Google is saying that it is ok to buy and sell links in some respects. So how do we know when it’s ok? Jim Boykin debates this in his blog. He suggests that the determining factor is whether or not there is some human element to the review decision and the possibility that the link will not be traded.

Ultimately, Jim suggests this:

“Getting a few of the right links, from the right places can be more valuable than getting 100 links from the wrong places.” He provides some great graphic analogies depicting what link buying does for a site’s reputation.

Aaron Wall, of SEO Book, suggests additional legitimate ways of buying links here.

In other words, DO YOUR OWN HOMEWORK. Think about the potential consequences of buying the pass. Follow good practices to make your site easily found on the web, and don’t overdo it or over pay for it. As businesses who want to sell online, the important lesson is to have a good product that people find worthy of buying. Build a reputation the old fashioned way – earn it.

I started this blog a few months ago. It naturally had a PageRank of zero. I am quite proud that it now has a PageRank of 2. I have a long way to go…

Bibliography and Additional Reading:

John Battelle, The Search: How Google and Its Rivals Rewrote the Rules of Business and Transformed Our Culture, Penguin Group, 2005, NY, NY

Aaron Wall, SEO Book, http://www.seobook.com/archives/002422.shtml, How to: Buy Links Without Being Called a Spammer, August 17, 2007

Jim Boykin’s Blog, http://www.jimboykin.com/site-backlinks/, Why That Site With 50 Backlinks Beats Your Site With 1000 Backlinks, September 2006.

Jim Boykin’s Blog, http://www.jimboykin.com/link-buying/, Link Buying: Reviewed and Not Guaranteed Is the Line in the Sand, January 2008.

Matt Cutts, Google Webmaster Central Blog, Information about Buying and Selling Links that pass PageRank, http://googlewebmastercentral.blogspot.com/2007/12/information-about-buying-and-selling.html

Matt Cutts, Matt Cutts, Gadgets, Google, and SEO, “Text Links and PageRank”, http://www.mattcutts.com/blog/text-links-and-pagerank/, September 2005 (Read article and comments for a good debate.)

For the Love of Blogs

I attended a presentation this week by a fellow colleague, Dr. John Whitehead, from Appalachian State University, at the Kentucky Economic Association meetings on the topic of “blogonomics“. He presented very insightful information on the topic of economics blogs. The data also shed some light on blogging and who is blogging in general. This led me to think about what role blogging plays in the business of selling online.

What is blogging?

By now, most online users that would be reading this post will know that a blog is a “web log” and the blogosphere is the online community of weblogs. A Pew Internet and American Life Project found that about 39% of the online population reads blogs. Technorati publishes an annual “State of the Blogosphere“. The report is loaded with statistics about who is blogging. According to Technorati, U.S. Bloggers tend to be male (57%), over 35 (58%), employed full-time (56%), earn more than $75,000 (51%) and college graduates (74%). Of interest to small business is that more than four in five bloggers post product or brand reviews. One-third of bloggers have been approached to be brand advocates. According to Sifry (2008), there were 70 million weblogs in early 2008 with 120,000 new weblogs started each day. 3000-7000 of the new blogs are likely to be splogs (fake or spam blogs).

What does blogging mean to small business?

Zahorsky defines a business blog as “a corporate tool for communicating with customers or employees to share knowledge and expertise.” A business can use a blog to do a number of things such as provide commentary, product reviews, event or sale information, social networking, and the like. Kyrnin suggests that blogs can be a powerful tool for marketing and promotion. Yet only about 41 percent of small businesses have their own websites, so a much smaller portion would actually have blogs.

According to Socialtext.com, 12.2% of the Fortune 500 companies have blogs that are “active public blogs by company employees about the company and/or its products”. A listing is provided here: http://www.socialtext.net/bizblogs/index.cgi. This site also analyzes 30 blogs from the list and puts them on a “bias” graph according to whether or not the blog provides “casual & colloquial” or “logical & formal” information or commentary. This is interesting information shedding light on the why’s and how’s of corporate blogging.

Blogs, however, are a simple, low-cost easy way to keep consumers informed and keep your site fresh and changing. In a recent post, I talked about the role of article marketing in raising PageRank and keeping content changing. These are important for raising your position in SERPs (search engine results pages). A blog is a similar and related way to do this. Zahorsky suggests using blogs to answer frequently asked questions, promotions, contests, new and forthcoming product information, photos, and news. He suggests keeping blog posts short, keyword heavy, and full of links. (I tend to prefer long posts less often, but there are no set rules on blogging as long as it is useful.)

So what are some economics of blogs?

Briefly, here are some thoughts on this topic.

Opportunity costs: Blogging is a low-cost, low-tech, no entry barrier, and scalable way to promote your company. However, the opportunity costs can be high. Blogging takes time. In the business world, the oft quoted phrase “time is money” couldn’t hold more true. The opportunity costs of blogging include the sales and productivity lost when blogging as opposed to operating one’s business. Technorati finds that one in four bloggers spends ten hours or more blogging each week and more than half spend at least five hours weekly on their blog. For many small business men and women, this time is better spent organizing their business and drumming up sales. Thus, blogging often gets put on the “good idea for later” list of things-to-do. So the question then becomes whether or not the benefits of blogging outweigh these costs. According to Technorati, one in ten professional and corporate bloggers pay staff to contribute to their blogs.

Marginal analysis: We just mentioned the opportunity costs of blogging. These costs increase as more and more time is spent blogging. As with most economic questions, we assume rational behavior. In other words, an activity should be continued as long as the marginal (additional) benefits exceed the marginal (additional costs). The benefits of blogging for small business include improved customer and employee relations from the provision of information and the potential increase in PageRank and SERPs positions with major search engines. There is also the potential for advertising and affiliate sales revenue as well.

Advertising: Blogs can be used to promote your brand or as a direct revenue producer via advertising revenue. According to Technorati, professional and corporate bloggers are more likely to include search ads, display ads, and affiliate marketing. One in four bloggers uses three or more means of advertising. In the same study, Technorati, reports the mean annual investment in a blog is $1020. Bloggers that include advertising tend to invest more, about $1800 on average, and corporate bloggers invest the most with an average of $3,790. The average annual revenue is more than $6,000. This revenue average is deceptive because most advertising revenue is earned by the top 1% of bloggers. The major determinant of advertising revenue is traffic to the site. The high earning bloggers receive more than 100,000 unique visitors per month. If no one reads the blog, then the profits earned from the blog will be quite low. Therefore, it is important to provide good quality content that will keep folks coming back.

Asymmetric Information: Nobel prize winning economist, George Akerlof, received his Nobel in 2001 for formalizing the concept of the “lemons” problem. The lemons problem is a result of asymmetric information. Asymmetric information is a situation in which one party in a transaction has more or superior information compared to another. With regards to blogs, this situation is one of adverse selection - deceptive behavior that takes advantage of information asymmetries before a transaction. Akerlof explained adverse selection using the case of used cars. The seller of the car knows more about the history of the car than the buyer. The seller will happily take the price of a good quality car for a lemon but will not accept the price of a lemon for a good quality car. If the buyer on the other hand believes there is some positive probability that the car might be a lemon, they will not want to pay the price of good used car at all. As a result, fewer good cars are sold on the used car market, and a distrust of the entire market develops. Read more. In other words, when someone reads a blog, they don’t always know about the qualifications of the author. Anyone can fire up a blog at a moment’s notice without any need for experience or knowledge. If a person learns that the information is uncertain after they have read the blog, they may grow to distrust all blogs as a result. The amount of time they invest into reading blogs will be reduced by the suspicion that the information may be frivolous, untrue, or incomplete. As a result of this problem, you will begin to see more ratings systems and listings develop to help sort the good quality information from the vast sea of frivolities. In consideration of this issue, I am honored that you have read this far!

Demand and Supply: Much of the conversation above alludes to this topic of supply and demand. My colleague, Dr. Whitehead, and his co-author, Aaron Schiff, are making one of the first attempts of which I am aware to actually estimate the supply and demand for blogs. Their focus is more on the economics blog writers, who, like myself, tend to write for self promotion, or, as I would prefer to put it, “the dissemination of knowledge in our area of expertise.” The major problem, of course, in this market is the determination of a “price”. The demand for such information would likely yield a low price for many of us. And as they show in their research, the concentration of the market is very low with no real entry barriers. The supply of small business blogs would more likely depend on the costs mentioned above for the provision of information concerning products and services and the demand for such information by consumers, employees, and advertisers.

Moral to the story

Blogs can be a very useful tool for promoting your small business and boosting your online sales. The provision of a blog is inexpensive in dollar terms, but the costs are not negligible when the value of your time is considered. These costs must be compared to the value of sales conversions from improved search engine results, direct promotion, information provision, and advertising revenue. Done properly, blogs could be profitable for selling online.

Bibliography and Additional Readings

Sifry’s Alerts, David Syfry, http://www.sifry.com/alerts/archives/2008_09.html, September 2008

How to Blog Your Way to Small-Business Success, Matthew Bandyk, September 26, 2008, http://www.usnews.com/articles/business/small-business-entrepreneurs/2008/09/26/how-to-blog-your-way-to-small-business-success.html

All Technorati information comes from Technorati’s State of the Blogosphere 2008, http://www.technorati.com/blogging/state-of-the-blogosphere/

Blogging Is Bringing New Voices to the Online World: Most Bloggers Focus on Personal Experiences, Not Politics, 7/19/06, http://www.pewinternet.org/PPF/r/130/press_release.asp

About.com, What a Blog Can Do For Your Small Business, Darrell Zahorsky, http://sbinformation.about.com/cs/ecommerce/a/bblogs.htm

How to Use a Blog for Non-Diarists: A Blog Can Hellp Your Business Even if You Don’t “Blog”, Jennifer Kyrnin, http://webdesign.about.com/cs/weblogs/a/aa061603a.htm

The Worldwide What? Only 41% of Small Business Owners Have Websites, Warrillow & Company, 2008, http://www.warrillow.com/weeklyNews.aspx

Blogonomics, John Whitehead, http://www.env-econ.net/2008/10/blogonomics.html, October 2008

Article Farming - Food for Search Engine Optimization

While researching topics for the course that accompanies this blog I noticed a disturbing trend. I use Google Alerts fairly often to get practical applications of topics that I want to present. However, I noticed that I was coming across an abundance of low quality short article posts on various topics. Many of the them began with titles like the “Top 10 Reasons…” or “The Top 7 Ways…”, etc. Others were short how-to articles. Often the same article could be found on different web sites. Many were laden with spelling and grammatical errors. Most were replete with advertising. Eventually I began to see through the fog known as article marketing. I ran across ads for freelancers to write blog posts – by the hundreds. I found volume discounts offered to companies who purchase large numbers of articles written by bloggers. What is this strange market and from where did it come? For every good idea created on the Internet there is a market to exploit it, and that is fine. As an academic, the origins of this market seem to have come from a source surprisingly close to home.

Origins of article farming

I believe the origins of what I call “article farming” on the Internet, otherwise known as article marketing, has risen with the advent of Google’s PageRank and other determinants of SERPs (Search Engine Results Pages). An anonymous author on Wikipedia suggests these origins go farther back. This author suggests that it has been common practice over the years for newspapers, magazines, etc., to accept “How To” articles from companies in exchange for acknowledgement of the company’s authorship. This provides free content for the newspaper and free advertising for the company - an arrangement that works out well for both parties. However, this would not entirely explain the watering down of content that is occurring on the Internet. In our non-Internet newspaper example, poor content would lead to lower sales of newspapers and thus would not be tolerated. There must be more, and I believe the explanation lies in search engine optimization. On the Internet, positioning in SERPs, or Search Engine Results Pages, can make or break a small business selling online. Participating in the market for articles is a way to achieve better positioning. To see, let’s look at the idea behind PageRank.

PageRank is an algorithm used by the search engine Google to rank websites in its search results. Craven explains the mathematics behind the algorithm*, but more interesting to me is the philosophy behind it. This is explained in amazing intuitive detail using laymen’s terms in Battelle (2005). Battelle tells the story how Larry Page and Sergey Brin developed the PageRank concept (named after Page) and the early Google search engine as part of a graduate school project at Stanford. Being in academia, they had a pretty good understanding of the concept behind publishing in academia. Professors gain recognition by publishing in leading peer-reviewed academic journals. The higher the journal ranks and the more citations from ranking journals that an article receives, the more important the publication. Page and Brin developed PageRank based on this concept. A site’s “peer review” was assumed through the quality of sites that find it worth linking to.

Page and Brin sought through PageRank to reduce the ability of spammers to rise to the top of search engines and to provide more relevant results. They built in the importance of backlinks into their search engine. E.g., let’s say that your site is Site A. A backlink is a link from another site (Say, Site B) that links to your website (Site A). A backlink would be the equivalent of a vote for your website. (Likewise, your vote for Site B through linking to it is its backlink.) In other words, the more websites that linked to a website, the more important that website must be. But they didn’t stop there. That concept would be easily manipulated – just get lots of folks to link to your website. Instead they built into PageRank a way to rank the backlinks such that higher ranked websites that link to a website have more weight than lower ranked websites that link to it. So a website’s position in Google’s search engine results depend, in part, on the quantity and the quality of sites that link to it. PageRank is also affected by sites a website links to, as well (so be wary who you link to, as well as, who links to you). So on the Internet, site relevance is, in part, determined by the number of votes a site receives through links to it, as well as, by the company it keeps through sites to which it links.

So how does PageRank lead to article farming? An author writes an article rich in keyword content and posts it in an article directory, a website that specifically hosts articles for dissemination. The article contains a resource box which contains such things as the article’s author, the author’s company, and a link to the author’s website. This creates a backlink to the author raising the author’s site’s PageRank. The article directory places relevant ads on the article giving it some advertising revenue while also increasing its content (which raises its position in SERPs). A company that uses the article places the article on their own site creating new content (which raises its position in SERPs), as well as, creating a backlink to the article directory further raising its PageRank. So it’s a win-win situation for all, right? Not so fast.

The market for articles – or keyword rich content

This is a classic example of supply and demand in a very competitive market with very low barriers to entry and exit. As I see it, two closely tied markets have developed which could be seen as part of the infamous “circular flow” diagram. First, there is the market for articles and second, there is the market for resources to produce the articles.

The supply for the market for articles is produced by freelance bloggers building a name for themselves, companies trying to get their websites noticed by search engines by providing “advice”, stay-at-home workers earning a little money on the side, etc. The main barrier to entry is knowing how to market yourself online and the reputations of established bloggers. Often these articles are supplied to the market via article intermediaries, otherwise known as article directories. The main requirement for the articles is that they be rich in popular keywords or search terms.

The demand for the market for articles are time or expertise strapped companies looking for new keyword rich content to produce a steady flow of traffic to the site. SERPs change often, so fresh content helps a company maintain, as well as, raise their positions in online search results. Companies will seek articles from article directories or hire writers to create content.

In researching this article, I came across advertisements requesting authors’ services and selling authors’ services. The market price for keyword rich content is relatively low. In many cases, articles are provided for “free” as authors build reputations for themselves or their sites. The going rate for services seems to be anywhere from $10 to $50 per article, and of course, this depends on the length of the article and experience of the author. If an author is really good he/she may break out of the article farming mold. Some sites offer volume discounts to companies purchasing articles. 1-5 articles may be $45 per article, but 8-10 may be $35. Small companies hoping to build page rank need lots of articles at low cost. They can get these articles for “free” from article directories if they are willing to accept the advertising terms. The article directory is getting advertising revenue which increases with the number of articles they support and their ranking in SERPs.

The way I see it, this market produces more articles, less pay per article, and lower quality work per article. The market is being flooded with blog/article posts. One website boasts “We are looking for expert Freelance Bloggers who can write on any given topics with little research.” A major health magazine advertises “magazine for work-at-home writers / bloggers – anybody interested in writing about health, even casually, with no experience required.”

As I write this article, I am aware that my opportunity costs rise with each article per week that I put together. To write more for industry, I would demand higher pay per article – which is why I would never make it in the business. Serious writers will likely move on to other writing venues rather than continuing to participate in this market. The market does provide a good opportunity for less experienced writers with lower opportunity costs. As such, the market appears to be quite oversupplied leading to low priced, low quality articles providing content largely to fool search engines into thinking the site has more relevance than it actually does – article farming.

So in the end, this is likely a win-win situation for many of the parties involved. The potential loser is the consumer searching for information who will increasingly find low quality information available for free on the Internet. In this case I remind the consumer, you often get what you pay for, and this free lunch may leave you a little hungry.

*If you would like to play with the PageRank algorithm, try Google’s PageRank Calculator from WebWorkshop. To calculate your website’s PageRank, try this PageRank Calculator.

Articles Cited and Further Reading

Article Marketing, http://en.wikipedia.org/wiki/Article_marketing

“Google’s PageRank Explained and how to make the most of it”, Phil Craven, Webworkshop.net, http://www.webworkshop.net/pagerank.html

“The Anatomy of a Large-Scale Hypertextual Web Search Engine”, Sergey Brin and Lawrence Page, 1998, http://infolab.stanford.edu/~backrub/google.html

Batelle, John. The Search: How Google and Its Rivals Rewrote the Rules of Business and Transformed Our Culture, Penguin Books Ltd. 2005.

Common Article Directories:

http://www.articledashboard.com/

http://www.articledirectory.com/

http://www.articlegold.com/

http://www.goarticles.com/

Examples of Authors for Hire Sites:

http://www.freelancers-wanted.com/

http://www.ifreelance.com/

Tips for Authors for Hire

11 Skills That A Freelance Blogger Should Have,Raj Dash, March 9, 2008 http://performancing.com/freelance-blogging/11-skills-freelance-blogger-should-really-have

“Problogging Tips: Get Smart, Leverage Your Research”, Raj Dash, March 6, 2008 http://performancing.com/problogging-tips-get-smart-leverage-your-research

“Freelance Blogging for Side Income: My Top 10 Tips”, Skellie, Feb. 26, 2008, AnyWired.com, http://www.anywired.com/freelance-blogging-for-side-income-my-top-10-tips/59/