As MG Siegler from VentureBeat noted, among many others, Google Trends now offers a feature that shows the traffic many websites get, much like Alexa does using data from the Alexa toolbar. The new functionality also shows similar pages and queries, people who visited site X also visited Y and people who visited site X also searched for Y.
Danny Sullivan, when talking about similar features Google launched in a new tool called Google Ad Planner, wrote:
I specifically asked ... [if] the [Google] toolbar is NOT [being used], and [a] "secret sauce" reply ... is all I got.Erick Schonfeld at TechCrunch followed up with a post, "Is Google Ad Planner Getting Its Data From The Google Toolbar?
That makes me think that toolbar data IS being used. In particular, the focus on Google Analytics data feels like a sideshow. Google can't rely on Google Analytics as a core data source for this information, because of the simple reason that not every site runs it. In contrast, using Google Toolbar data would give them a nearly complete sample of all sites out there.
There isn't much new about using this data in the way Google Trends has revealed. Alexa and others have been doing it with their toolbars for many years. What is new is that Google Toolbar is installed much more widely, including on every Dell computer and in every installation of Adobe Flash.
I have no information about whether Google is using their toolbar data, but I have a hard time believing they could resist it. Not only can it be used for things like Google Trends, but it could have a dramatic impact in core web search.
PageRank, the original core of Google's search relevance, is an analysis of the links between websites that simulates someone randomly surfing across the links, the so-called random surfer model.
With toolbar data, you no longer needs this approximation of a random surfer model. You have the actual surfer model.
You know exactly how people move across the web. You know which sites are popular and which sites are never visited. You know which links are traversed and how often. You know everything about where people go and what people want.
Data like that should allow tremendous advances in relevance. It is hard for me to believe that Google would not be using their toolbar data, not just for Google Trends, but also in search and advertising.
Please see also my earlier post, "Ranking using Indiana University's user traffic", which discusses a paper from WSDM 2008 that attempts to supplement the PageRank random surfer model with an actual surfer model.