WebWatch Scores Search for Mixing Paid, Natural Results

A new report by WebWatch, the Internet watchdog arm of the non-profit Consumers Union, says that many of the most frequently used search engines on the Web are doing a poor job of separating the organic sheep from the fee-paid goats in their search results.

The report, entitled “Still in Search of Disclosure”, is the group’s latest look at how well top search engines are doing at disclosing their ad policies and making clear to consumers which listings on the results pages derive naturally from their search queries and which have been served up as a result of payment—making them, in WebWatch’s terms, ads.

These fee-paid results can come about either through paid placement or paid inclusion. Paid placement occurs any time Web sites pay to get a prominent rank on a search result page, most often in the form of a pay-per-action ad linked to a search keyword. Paid inclusion charges a fee to assure that a site will get indexed by a search engine from the billions of pages that now make up the Web—although that fee does not guarantee a high ranking.

It’s not WebWatch’s first study on the relationship between search and advertising. In 2002, it conducted an extensive national poll of 1,500 adult Internet users to examine their search behavior. That study found that 60% of those users, all of them over 18 and relatively Web-literate, were unaware that some search engines accepted payment to either include Web sites in their indexing or to give them enhanced placement.

That survey and a complaint by another consumer watchdog group led the Federal Trade Commission in June 2002 to issue guidelines that called for distinguishing paid search results from unpaid by clear and conspicuous labeling. As another requirement, search engines were to be required to offer clear explanations of paid inclusion and easily visible notice about which rankings were the result of paid inclusion.

WebWatch revisited the subject in 2004 with an examination of how well 15 leading search engines were complying with those FTC guidelines. The conclusion at that time: Most had made some effort to meet the standards, but compliance varied widely, with some sites still apparently obscuring the presence of advertising in their “organic” search results, either through placement or inclusion.

The current survey, presented as part of a conference on search, advertising and consumer issues in mid-June in Berkeley, CA, re-examines those same 15 engines to track any further developments. According to Beau Brendler, WebWatch director, the findings are a mixed bag, with some engines showing marked improvement in the area of paid inclusion, but other making some subtle shifts toward hiding their disclosures and blurring the demarcation between paid and unpaid results.

In the year since the last WebWatch report, paid placement has if anything become more popular as a marketing tool. But the study finds that compared to the levels of paid-placement disclosure found a year ago, “some of the best [search engines] have gotten worse, a few of the worst have gotten better, and roughly half have remained the same.”

Among those doing disclosure worse than before, the report cites Ask Jeeves, MSN Search and Yahoo! for muting the colors of the labels for their paid placement ads since last year— in Yahoo’s case from red to gray, and in MSN’s case from gray to a fainter gray. WebWatch concedes that Yahoo! and MSN now offset some of their paid search listings into colored boxes.

The 2004 report also found that most search engines were exceeding FTC guidelines on identifying paid placement results by hyperlinking to separate disclosure page that explained their ad policies. But this year WebWatch found that four of those engines—Alta Vista, Ask Jeeves, MSN Search and Yahoo!—have discarded those hyperlinks; MSN has eliminated its disclosure page entirely. Engines are also required to link to disclosure pages regarding their use of paid inclusion, but WebWatch found that two of these, Alta Vista and Yahoo!, have modified their paid inclusion disclosures to make them harder to find. In Yahoo’s! case, the engine has replaced a once prominent “What’s this?” hyperlink with a more general “About this page” link that appears—confusingly—above a set of paid placement listings rather than paid inclusion.

The good news about paid inclusion is that it has declined among the largest search engines, Brendler says. Since the 2004 report, both MSN Search and Ask Jeeves have stopped charging paid inclusion fees, joining AOL and Netscape, which dropped the product earlier, and Google, which has never offered it. But nine of the 15 engines studied still sell paid inclusion, and Brendler admits it’s “impossible to tell” about the tenth, 1st Blaze.

“The bell curve for paid inclusion is going down while it goes up for paid placement,” Brendler says. “I think it’s not as lucrative as paid placement. I also think companies may have gotten savvier about search engine optimization and may now be more confident that their Web sites are search-bot-friendly.”

But those new recruits to the ranks of the paid-inclusion-free still haven’t made it any easier for consumers to be sure that they’re using a search engine that doesn’t take a fee for indexing a Web page. In fact, in the 2004 report, some WebWatch testers mistakenly assumed that Google, AOL and Netscape also used paid inclusion when they didn’t, simply because nothing on their user-facing sites said otherwise. This year, those sites (now including MSN Search and Ask Jeeves) still don’t inform consumers that they don’t take paid inclusion; but they do tell advertisers.

“You would think that having dropped paid inclusion, these five search engines would make more of that in marketing themselves to users,” Brendler says. “If I were MSN, Ask Jeeves or Google, I would publicize that as a differentiator in the market.”

Last year, metasearch engines—which aggregate the search results of other Web sites—came in for special blame in terms of how well they disclosed paid-placement and paid-inclusion results. This year, however, the WebWatch study found a marked improvement in disclosure compliance by two of the three metasearch engines tested, CNET and Web Search. “That’s a tough challenge for them, because they get their results from multiple third parties,” Brendler says.

Finally, WebWatch sees potential for confusion in some search engines’ tendency to promote content from their sister sites on search results pages in ways that obscure those relationships. AOL, MSN Search, Netscape, Lycos and Yahoo! used this kind of “content promotion” last year. And while MSN eventually dropped the feature, the others have if anything increased the prominence of their own site content on results pages, usually under misleadingly non-specific headings such as “Snapshots” at AOL and “Shortcuts” on both Alta Vista and Yahoo!

As for reaction from the search industry, Brendler says it largely mirrors the arguments he heard at the Berkeley conference earlier this month, which was attended by both Web advertisers and directors from many of the top search engines. “The feeling of many of the panelists was that consumers want relevant results, but that advertising can be relevant,” he says. “The biggest disagreement was over the belief that somehow gaming search so that consumers are looking at advertising along with objective information was no big deal. Obviously, we don’t agree.”

Proper labeling and disclosure of paid elements in search results can build user credibility, Brendler says, and translate into better ads and more revenue. He points to Google as an example. The most widely used search engine in the world has never offered paid inclusion, and in fact just launched a test of a free utility that will let Web operators get their sites indexed more rapidly and more often. And while its paid placement labels and hyperlinks were criticized last year and this year as too hard to see and use, the engine won WebWatch’s praise for a page designed that made a clean, clear separation between paid ads and natural search results.

“The market is rewarding Google,” he says. “Their market capitalization is incredible, and no other search engine has been turned into a verb. I’m cynical enough to think that as more people see their success, they will try to emulate the good policies that create it.”

“We’re not against making money, but we are concerned that some search engines are presenting themselves as objective sites, with the most relevant information and the best deals, but are not making it clear to the user what is an ad and what isn’t.”

Of course, there’s also the issue of how much users have changed as search becomes a more important tool for navigating the Internet. Brendler said WebWatch is currently fielding another national survey on consumers’ knowledge about search and hopes to know by this September whether that 60% of the Internet-using public has gotten smarter about the way search engines work. “I would certainly hope so,” he adds.

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