Saturday, November 17, 2007

Who cares about grandma?

Jeremy Crane at Compete.com reports that
The top 1% of searchers performs a full 13% of all searches in a given month.

If you extend this to the top 20% the number of queries increase to roughly 70%.
John Battelle argues that the focus on making things easy for common users -- make it work for grandma, as I frequently advocate -- could be misguided.

Since power users make the majority of searches, a search engine that targets power users could attract a majority of searches without attracting the majority of visitors.

However, there is some debate in the comments to John's post about whether Jeremy measured the right thing. What matters most is not the number of searchers, but the ad revenue from those searches.

It is unclear whether these power users who are making the majority of searches are actually the most profitable visitors. Some commenters argue, only anecdotally, that power users may be the least likely to click on ads.

It is an interesting question and one that begs for hard data. Does anyone know if 20% of searchers generate 70% of advertising revenue? Is that 20% is the same 20% that does the 70% of searches? Alternatively, is there is a negative relationship between number of searchers performed by a user and the average revenue per search?

Update: At least for banner advertising, AOL EVP Dave Morgan apparently has some data, writing:
Ninety-nine percent of Web users do not click on ads on a monthly basis. Of the 1% that do, most only click once a month. Less than two tenths of one percent click more often. That tiny percentage makes up the vast majority of banner ad clicks.

Who are these “heavy clickers”? They are predominantly female ... older ... [and] Midwesterners ... They look at sweepstakes far more than any other kind of content. Yes, these are the same people that tend to open direct mail and love to talk to telemarketers.

What does all of this mean? It means that while clickers may be valuable audiences, they are by no means representative of the Web at large.
[Found via Danah Boyd via Jeremy Pickens]

4 comments:

Anonymous said...

Interpreting such figures is tricky because two courses of action are possible.

1. Make search better for the power users because they generate the money.

2. Forget the power users because they're already good customers. Figure out how to make the other 80% more profitable.

Thoughts?

jeremy said...

That data would indeed be interesting to come by.

Given that no engine is likely to release this info, however, maybe we can approximate it? What I mean is, at Amazon, did you see a correlation between power users (either folks that searched a lot, or folks that purchased a lot) and their proclivity toward clicking "Amazon recommends" related items?

I am not asking for any proprietary info, of course. And maybe these situations (web search and product search) are not completely analogous, because what you are doing with recommendations is almost the opposite of searching: bringing items to a user's attention that they might not even have known existed, and would therefore have never searched for, on their own.

But if it is possible to draw comparisons, it would be interesting to know whether the power users on Amazon tended to know what they are doing with their searches, and therefore rarely click recommendations, and vice versa (i.e. whether grandmothers tended more to click recommendations).

This might give us a way of approximating your questions above.

Anonymous said...

It is indeed interesting. (By the way.. sorry to see Findory go !).

There are clear signs that more and more people ignore ads. Generation Y, cannot be reached that easily with ads but need more involvement. OK so is it such an unfair assumption that power users would be the ones ignoring (certain type of) ads most ?
In search how trusted are ads ? Compare social networks: packed with ads, easily ignored. CPM very low.

So I think your point is correct: inexperienced users will probably not be so sophisticated in their behavior and therefor ads could have a higher clickrate, if even by accident.

Second: it becomes a self-fulfilling prophecy. I remember similar stories about adoption rates of internet banking (in Holland, I am Dutch). It's massive at the moment and very secure. Back then.. people didn't trust it, it was assumed the youth would pick up first, marketing reached out to the youth and guess what: highest penetration rate was amongst the youth. UNTIL you calculated rate/marketing $. Then it was a different story. My point being: if you focus on the power user and do not experiment with the "long tail" (I know overused but still), who knows what untapped markets you can reach.

Swaroop C H said...

I think we should also consider the amount of internet usage - if the power users are "webworkers", then this makes sense. Maybe grandma spends only one hour a day or even a week just to check her grandchildren's photos and search for a thing or two...

-- Swaroop
www.swaroopch.com