The single biggest reason Yahoo! had to gut their search efforts was that they offered a syndication network with tons of fraudulent search distribution, and never let you opt out of it until 2010. It killed their click value and simply made it impossible for them to create enough yield on their core search traffic.
Google has long allowed advertisers to opt out of the content network and many search partners, and that has made their core market healthy. And given their efforts to detect fraud (and how smart pricing works on content websites) they have de-incentivized fraud to some degree. But now that content mills are being built, that trend may soon swing in the other direction.
With Demand Studio’s new revenue-sharing project, they encourage writers to share content with their relatives:
The more high quality links to your article there are on the web, the more highly a search engine will rank it. … Your family and friends are probably curious about what you are writing anyway. Send them links and invite them to take a look!
Given that authors are paid on revenue share, what is the chance that say 5% or 10% of them will also ask family members to click on the ads while viewing the page?
How could Google catch it?
You could say I am cynical, but human nature is predictable and many of the kinds of people who work for the content mills will do anything to make a Dollar. Laws exist to catch the bad actors, but when the publishers are encouraging the creation of distribution amongst friends & family and the party responsible is concealed from Google, the incentives are aligned against the interest of advertisers.
As fraud seeps in slowly, eventually it will become expected…either you engage in it, or your become an economically inefficient piece of the web – a relic. And most advertisers won’t know why their profits have dropped with the increasing number of clicks. Some will filter, but most of them will just lower their bids on the content network (or simply turn it off, as many did with Yahoo!), which in the end harms the legitimate publishers who run AdSense ads.
On one front they are stealing your content, and on the next they are destroying the value of the ads you carry. Like it or not, if you are an online publisher who depends on ad revenues it will impact you.
The incentivized publishers are pushing into the big money categories. Jason Calacanis outrageously suggested investing in people asking big money questions:
If I was a smart person I would INVEST in asking questions of high CPM value (i.e. mortgage, drugs, products, etc) and give them a nice M$3 tip. If you do that 33 times I’m betting you would make the M$100 back.
The suggestion of the free virtual currency flowing back and forth really highlights the end goal of such efforts. How long will it take advertisers to notice?
Outside of Mahalo & eHow, what other sites are engaging in the incentivized publishing programs? What sort of ROI have you seen from them? And how do you expect that to change going forward?