Wednesday, 24 December 2008

Breaking the AdSense model?

I am a bit tipsy at the moment, but I was having this idea. With my techie mind and my position in the midst of the financial industry, worrying about the recession can become quite interesting of a conversation after a few pints....

Anyway, we were talking that innovation is the only way to get the economy moving. Innovation, is new ideas, which create new businesses, demand new skills, and move the investors and the entrepreneurs.

Well my brilliant - well brilliant if you were reverse brainstorming- idea was to start a social movement to urge people to start clicking on all these ads you see everywhere on the internet. In 2007, Google had almost 18 trillion clicks. That's alot of clicks, considering that companies that run ads online pay per-click, and the clicks themselves can become quite pricey, with up to 5$/click. The idea behind that, is that if so much users click on these ads, some of them will eventually become customers. i.e. the traffic on that website will be increased, and the more traffic you get to your website, the more you sell stuff. The click itself, is completely free from the user/surfer's end, as all they do is click. The idea is that if we start that social movement to urge people to start clicking more on these adds, Google, or people behind the Ads, will start making much more money if , for example, the clicks jump to like 30-40 trillion clicks, the size of the AdSense market will double or triple. Be it an already huge market, in the 100+ Billion dollars, then tripling it, from the user end, is a free contribution of throwing like 200 billion dollars into the markets. Well, that's bigger than alot of bailout packages governments are dishing out, combined!

Wait a minute, but wouldn't that break the Google business model, and collapse the AdSense? The idea that more clicks would bring more customers, and bring more business, based on the assumption that if one tenth of the people visiting there site will buy something, that's great! But, what if the users in this alleged social movement are just clicking at random without actually looking at what they are clicking? This means that more traffic isn't really getting more customers. At that point, the advertisers themselves will start complaining and would want the AdSense prices slashed by the same ratio of customer/visitor was reduced. The bad thing about that, is that the market will shrink back to its original size, and our social movement is rendered useless, and they revert to stupid suckers clicking without a cause. (Then they establish a charity and get government benefits). The loser in this game, is that the AdSense business mode will collapse to the extent that its become commodetized and it doesn't really derive serious revenue like it does now, and a new innovation will be needed.

The only upside of this, is that even if these members of the social movement are still to determine whether they are smart geeks or a bunch of suckers, pshychology is on the market's side is that no matter how indiffirent you will be to what you are clicking, you will eventually find yourself stopping at one of the random links you clicked, because something caught your eye. Probability is also on psychology's side- because girls will always stop at the word chocolate, as well as the guys will pause on a lingerie picture. (Did I just make a girl/guy psychoanalysis? Sorry!)

I started an internet movement, financed it, and completely broke down my business model. So I guess I still don't have my winner tech-business idea.......

Damn it!

No comments: