88 Computer

W E B T E C H N O L O G I E S

F or many people, Web searchengines are now the primarymethod for finding infor-mation, news, and products (www.digitalcenter.org/pdf/

Center-for-the-Digital-Future-2005-Highlights.pdf). Consequently, bothresearchers and the media havefocused considerable attention on thespeed, accuracy, and efficiency ofmajor search engines such as Yahoo!,Google, MSN Search, and AOL.

However, paid search—an increas-ingly important, popular, and uniquelycontextual form of information inter-action on the Web—has thus farattracted less interest.

With paid or sponsored search, con-tent providers pay Web search enginesto display sponsored links in responseto user queries alongside the algorith-mic links, also known as organic ornonsponsored links. This mechanismplays a critical role in financing thenonsponsored links upon which somany users now rely.

A distinctive type of informationpush and pull, paid search also isincreasingly important in locatingdata on the Web. Because of theuniquely dynamic contextual inter-play among content providers, searchengines, and users, paid search offersnumerous unique benefits.

ORIGINS AND IMPACTBill Gross of Idealab (www.idealab.

com) is credited with creating thepaid-search paradigm in 1998 withthe launch of GoTo.com, which laterbecame Overture and is now Yahoo!Search Marketing. Google developedits own paid-search technology,AdWords, over which it settled apatent infringement lawsuit withGoTo.com in 2004. These two entitiesaccount for the majority of paid-search traffic today.

The economic impact of paid searchis immense. In 2004, paid search wasan $8 billion industry and already vitalto the success of most major searchengines—for example, 99 percent ofGoogle’s revenue came from advertis-ing, while Yahoo! received 84 percentof its income from paid ads (TerryMcCarthy, “Yahoo! Goes to Holly-wood,” Time, 21 Mar. 2005, pp. 50-53).

In 2005, paid search generated $10billion globally, a figure that isexpected to soar to $55 billion by2010 (www.clickz.com/news/article.php/3574876).

Although no published studies arecurrently available on the effectivenessof paid search, anecdotal evidencesuggests that sponsored results are justas relevant as nonsponsored results forsearch queries—if true, an amazing

feat for a model less than a decade old.Without a doubt, paid search is now,and will be for the foreseeable future,the primary business model for Websearch engines.

A DYNAMIC PROCESSSatisfying both Web searchers’

desire for relevant information andproviders’ desire for targeted traffic totheir Web sites has become increas-ingly complex. However, the core ele-ments of paid search have remainedessentially the same throughout itsdevelopment:

• provider content: a set of keywordsassociated with concepts alongwith the associated URLs, titles,and descriptions;

• provider bids: bids for specifiedkeywords that are a monetary val-uation of traffic to a particular Website;

• search engine review process: amethod to ensure that advertisercontent is relevant to the targetedkeyword;

• search engine keyword and contentindex: a mechanism that matchesprovider keywords to user queries;

• search engine user interface: anapplication for displaying providercontent as links in rank order to asearcher; typically, the interface dis-plays the sponsored links with non-sponsored links;

• search engine tracking: a means ofmatching keywords to queries,gathering provider content, han-dling bids, metering clicks, andcharging providers based onsearcher clicks on their displayedlinks; and

• searcher: a person or agent thatclicks on a sponsored link deemedto be relevant.

Figure 1 illustrates the dynamic rela-tionship among these elements in thepaid-search process.

KeywordsContent providers develop terms

and search phrases composed of key-words that

Paid SearchBernard J. Jansen The Pennsylvania State University

With paid search, the contentprovider, search engine, and userhave mutually supporting goals.

July 2006 89

• searchers are likely to submit, • are applicable to the providers’

Web content, and • will link such content to searchers’

underlying intent.

They also tailor the presentation ofsearch results to conform to the tar-geted queries, possibly with severalvariations linked to particular sets ofqueries.

Content providers pay the searchengines to present their tailored Webresults whenever a searcher submitsone of these terms and clicks on thelink. The provider can tailor thismatching algorithm from exact tar-geted matches to very loose matchesto account for various spellings andmisspellings as well as term usage. Thesearch engine matches the searcher’squery to the keywords that corre-spond to the provider’s bid.

Auctions The content providers pay the

search engine via a bid on the key-word. However, multiple providersmight want to pay a search engine forthe same term or phrase. In thesecases, an electronic auction handlesranking, typically in descending orderaccording to the bid amount.

Search engines also factor other ele-ments into their ranking scheme, suchas which sponsored link receives moreclicks. This helps prevent searchengines from presenting less relevantcontent to the searcher solely for profit.In practice, though, the links with themost clicks generally produce the mostrevenue. All participants in the paid-search process thus have a monetaryincentive to strive for relevant content.

The more providers want to displaytheir links in response to a term orphrase, the higher the minimum andmaximum bids. Usually, the minimumbid on any keyword is about 10cents—that is, the search engine getsthis amount from the provider everytime a searcher clicks on a sponsoredlink presented in response to the key-word that the provider bid on.

For competitive markets, the bidscan get much higher. According to

TopPayingKeywords.com, the mostexpensive keyword phrase at the closeof 2005 was “Chicago personal injuryattorney” at $50 per click, closely fol-lowed by “mesothelioma” at $42.57per click.

From the content provider’s view-point, electronic paid-search auctionsare a mathematical optimizationproblem. Bidders might face hundredsto thousands of keywords that needto be priced. Bids aren’t static, so con-tent providers must be ready tochange their bids quickly to exploitchanges in consumer behavior andreact to the competitive environment.For this reason, researchers are devel-oping complex machine-learningalgorithms that more efficiently weighrisks and attain maximal returns.

Searcher actionsWhen a searcher submits a query,

reviews the sponsored links, andclicks on a link, the searcher’s browserdisplays the provider’s Web page thatthe link points to. The search enginetracks this click and all others withina given period; at the end of thisperiod, it bills the provider and pro-vides various statistics concerning theprovider’s campaign.

Based on these statistics, providerscan choose to alter bids, maximumcosts per period, and keywords in realtime. They can also change terms orphrases, the price they’re willing to bid,the degree of term matching, and eventhe price they pay in a given period. Inthis way, content providers become

active participants in searchers’ infor-mation-seeking process.

BENEFITS Most advertising models measure

the cost of an advertisement based onhow often and when it is shown. Forexample, broadcasting an ad severaltimes during the Super Bowl will costconsiderable money, while showingthe same ad once on a local TV stationat 2:00 a.m. on a Tuesday will be rel-atively cheap. However, there are noreliable mechanisms for translatingthis “cost per impression” into sales.

In contrast, paid search makes itpossible to measure how many peopleviewed a link as well as how many“came to the store,” or clicked on thelink. It’s also possible to measure thenumber of users who executed a trans-action or took an action on the Website.

Another benefit of paid search isthat the content provider, searchengine, and user have mutually sup-porting goals. As in most forms ofonline searching, the user has someinformation need bounded by cogni-tive and situational factors, while thesearch engine must service relevantcontent to the user. What makes paidsearch unique is that the contentprovider seeks via keyword selectionto determine the user’s underlyingintent and attach some monetaryvalue to it.

Suppose, for example, a usersearches for “digital camera.” Whilecontent containing this expression

TitleDescriptionURL

Keywords

$ range$/period

Bid

Payment

Review process

Accept contentKeywords andcontent index

Match queryto keywords

Accept query

Display links

Display result

Submit query

Form query

Review content

Click on link

Review linksTrack bidsTrack displaysTrack clicks

Bill provider

Accept bid

Content

Provider Search engine Web searcher

Internet to provider Tracking Interface to searcher Searcher actions

Figure 1. Paid search on the Web is a dynamic process involving numerous participantsand goals.

90 Computer

W E B T E C H N O L O G I E S

D espite the many benefits of paidsearch, concerns remain. One ofthe fastest growing online prob-

lems is click fraud, which involvesclicking on sponsored links—eithermanually or via automated software—without any intention of making a pur-chase. Perpetrators seek either todeprive a rival of advertising funds orto direct phony traffic to a Web site toboost pay-per-click revenue.

Nevertheless, the appeal of paidsearch appears to be growing. Themajor search engines continue toexpand the basic model, linking paidsearch to other information mediasuch as telephony and television. Forexample, both Yahoo! and Googleprovide campaign management toolsthat permit providers to synchronizepaid search with other online adver-tising campaigns.

might be relevant, a standard searchmechanism doesn’t address the rea-sons underlying the query: Is the usergetting ready for a vacation, taking upphotography as a hobby, or lookingfor a gift for someone special?

Paid search enables the contentprovider to make these connections.The drive to understand the searcher’sintent and algorithmically tie it to con-tent is what separates paid searchfrom traditional forms of metataggingthat focus solely on elements such asauthor, topic, creation date, and con-tent terms.

For users, paid search also signifi-cantly reduces the spam that oftenaccompanies organic results. Providershave a cost incentive to present rele-vant content, and search engines haveboth automated and manual reviewprocesses to facilitate this process.

This cross-medium linkage can sig-nificantly increase the synchronizationof information pull and push, provid-ing more relevant content to thesearcher. Certainly, the goal of allinvolved is to get the right informa-tion to the user at the right time and inthe right form. ■

Bernard J. Jansen is an assistant profes-sor in the College of Information Sciencesand Technology at The PennsylvaniaState University. Contact him at jjansen@acm.org.

Editor: Simon S.Y. Shim, Department ofComputer Engineering, San Jose StateUniversity; sishim@email.sjsu.edu

Stay on TrackIEEE Internet Computing reports emergingtools, technologies, and applicationsimplemented through the Internet to support a worldwide computing environment.

In 2006, we’ll look at

• Distributed Data Mining

• Web Services forGeographic Information Systems

• Malicious Software

... and more!

www.computer.org/internet