If you ever make the mistake, as I recently did, of reading Twenge and Campbell’s The Narcissism Epidemic: Living in an Age of Entitlement, you’ll have more than a few “whoa! that’s scary!” moments, when you begin recognizing vivid examples of the shift they’ve documented as they happen in slow motion in day-to-day life. Scary, as in “they really got that right.”

This study of the rise in narcissistic qualities in the general (especially, youth) population is no casual observation. The authors actually document rises in self-reported and externally-evaluated scores of clinical narcissism. On many counts, those numbers have been rising for nearly 30 years. There is an interesting dip that occurred in one of the graphs; in my generation (for a brief moment in time in the late 1980′s), for about two years college-age students actually reversed the trend. But then the inexorable rise continued.

Not everyone is clinically narcissistic today. But more people than ever believe that utter self-belief and lack of regard for others is “normal” behavior.

The “originating” root of the trend is the self-esteem movement, which you can trace all the way back to the 1970′s. By the 1990′s, over-the-top efforts to boost self-esteem at every turn had infected child-rearing and education at all levels.

An accelerator of that trend seems to be social media. Many people who get caught up in the exercise of preening and bragging in social media venues appear to lose all sense of perspective.

According to the authors, extreme narcissists take on personas like “school bully.” These bullies don’t lack self-esteem; their problem is that they have too much of it, and too little regard for others. In today’s environment — whether in real school incidents or relentless messages portrayed in pop culture — it’s well documented that bullies like this can actually be the object of pity because they don’t have enough self-esteem. The prescription to handle someone who is terrorizing others? Coddle them and help them to work on gaining even more self-esteem, so the situation can normalize itself. Prop them up just a bit more, and they might stop trashing others! Instead, the opposite is likely to happen. They love themselves so much, their sense of entitlement only grows.

Last week, a so-called photographer from Arkansas, Meagen Kunert, was exposed for ripping off the wedding photos of pro photographer Sean McGrath of Saint John, NB, Canada. In addition to passing off McGrath’s photos as her own, she added insult to injury by creating fake personas and narratives connected with people in the wedding party. The real people involved felt creeped out by the whole turn of events.

After the firestorm went viral and global, Kunert had no choice but to apologize for what she’d done. She added, though, that she felt driven to it by the intense pressures of competing out there. In other words, a few words of apology were barely out of her mouth when she began cooking up a rationalization… one that ended in “It’s sad.” The full quote: “The photography industry has come to the point where you feel like you have to take other peoples’ work just to compete and to feel better about yourself. … It’s sad.”

Just another exemplar in the long line of cases that back up Twenge and Campbell’s thesis: not only has the self-esteem movement (accelerated by social media) flown out of control, millions of people are being given blatantly misguided ideas every day about what self-esteem is, and how to achieve it… and a warped model that wrongly assumes that good things spring from developing self-esteem unattached to any basis.

Kunert’s problem wasn’t pressure or some gap in how she felt about herself, it was an unwillingness to take the needed steps to accomplishment. It certainly seems like a competitive world when you mentally compare yourself to people who have already reached the top rungs in your field. It’s less insanely pressurizing when you focus on bottom-rung stuff like customers, working hard, strategy, and caring about those around you.

In other news… I’m betting there is no nice, shiny, flattering explanation to explain multibillionaire Eduardo Saverin renouncing his US citizenship in order to avoid a large tax bill. The press have been supplied with one and are willing to give it equal time: he has a family history of moving to escape kidnapping by “ransom gangs,” so why maintain U.S. citizenship now, since that might have been a reason to move on from the U.S. to Singapore?

Some are calling such wealthy tax evaders the “stateless rich,” but is a life led with half that wealth, with some sense of roots that come with full and conscious citizenship, in fact much richer?

The alternative explanation to the “afraid of kidnapping” theme, then, is that Mr. Saverin is a U.S. citizen when it is convenient to him, and that his primary fear is of petty pickpockets: namely, that his multiple billions will shrink slightly. Only Mr. Saverin knows the real truth.

In Mad Men Episode 509, “Dark Shadows,” Don longs to flex his old creative muscles on an account being worked on by the junior phenom, Ginsberg. In the review meetings for the Sno-Cone account, Don slips his “devil” ad concept into the mix. The team agrees that both Don’s idea and Ginsberg’s lighter “snowball in the face” campaign are both strong ideas. It’s agreed that the firm will bring both ideas in to pitch the client.

Don’s idea wins because he leaves Ginsberg’s creative in the cab, so they only pitch Don’s idea. The client buys.

Don should have felt vindicated even if his idea had lost in the end, because it had come roughly tied for first with Ginsberg’s idea in the feedback from his colleagues (some of whom didn’t fully know of Don’s involvement). Sure, it’s Ginsberg’s job to come up with the creative, but it’s equally important that Don have self-respect and that his best people respect him for more than just his past accomplishments. Having current “chops” is a bonus; it’s the difference between merely living well and being good. (Oh, not all kinds of good. Don doesn’t necessarily qualify as good, though arguably he’s less evil than some of those around him, in key situations. Unquestionably, and to his great relief, he’s still good at this.)

In the hyper-testing world of real-time-rotated ad testing that we live in, we can go one better, of course.

The boss can get a hankering to see if her ad will win. She can slip it into the mix, in a fair and even rotation. If it wins, it wins. The victory should be sweeter because there’s no leaving the other ads in the cab.

Now I’m in the business of supporting my team — not competing with them. But a little healthy competition is good for any agency, whether it self-identifies as “creative,” “data-driven,” or both.

And if my ads can’t win some of the time (or even most of the time), then Houston, we’ve got a problem. It’ll be time to don the weird slippers and sit in the lobby reading the paper… or spend more time at the country club. When that happens, you’ll be the first to know.

Unlike the average American 15-year-old, AdWords advertisers now have definitive proof that they can’t all be above average. This comes in the form of Google’s new breakdown format for keyword quality score reporting, by Expected CTR, Ad Creative, and Landing Page Quality.

Most advertisers already know that Quality Score (which determines ad rank and eligibility in the auction, and ultimately, heavily influences CPC’s and ROI) derives from CTR and “other relevancy factors.” This new disclosure shows that Google continues to refine the formula to help some advertisers get their “fair rank,” and to deter others from showing ads. They’re doing this by incorporating more and more data about ad creative and landing page quality. Today, Jonathan Alferness, Director, Product Management, on Google’s ads quality team, reminded me that these particular factors have been increasingly involved since a major round of updates in 2011. Thus, the additional disclosure at this stage is a way of giving advertisers some useful insight on top of an aggregate score number like 4 or 7.

When this disclosure was announced on April 24, there weren’t many insightful comments around the industry, with the unsurprising exception of George Michie, who as you can see from his post was roughly over the moon about the new info.

I wasn’t completely sure I understood the exact implications of the new reporting, so today I finally caught up with Jonathan to get the Googler’s deeper dive on what the headings mean.

Expected CTR is a measure of your CTR relative to other advertisers you’ll be duking it out with over the same keyword queries. If it’s below average, you’re probably targeting more broadly than others are in the auctions you will be entering against other advertisers, so you may be willing to accept a lower ROI (or bid lower, for less volume). If it’s above average, it’s quite possible that your ROI here will be benefiting from pursuing a strategy of granularity in your account structure (for example). This one has been the core of the Quality Score formula for years, but the additional disclosure is a helpful reminder that the measure is relative. You will do OK on some keywords even if your CTR looks low on an absolute basis, as long as you’re doing as well as other advertisers are. For some queries, consumers simply aren’t in the mood to click on ads. But Google will still show some ads.

Ad relevance, according to the loose description given to me by Jonathan Alferness, measures “how well the creative matches the keyword.” So what does this mean, exactly? How does Google determine this? They can’t and won’t disclose the secret sauce, but examples can help. What if there is nothing wrong with an ad, and users didn’t seem particularly dissatisfied or misled by it, but they weren’t all that likely to click on ads in that particular keyword space in general? Google wants to refine the process to rescue such keywords from “low Quality Score hell,” (my words, not Google’s) so that despite low CTR’s, advertisers may continue to serve ads despite a certain pattern of user response that does not scream “I’m buying today”. The ad is relevant and the ad does not bother people.

Some ad creative is in fact annoying to users despite some of its metrics being OK from the standpoint of the keyword CTR as well as the post-click engagement numbers. I still have trouble understanding how an ad could be deemed less relevant than it ought to be (below average), while the expected CTR numbers *and* the landing page quality numbers come in as average… unless Google has decided that something called ad relevance is intrinsically a good thing separate from both CTR’s and post-click engagement numbers like bounce rates and other elements of poor user experiences that cannot be measured with (eg.) bounce rates alone. Google may be willing to down-rank or show less often ads that are in some sense ‘problem ads’ or ‘spammy ads’ even if they do not get flagged as such by other more conventional measures of spamminess. Too many ads from Mars when the searcher is from Venus leads to an overall feeling of clutter on the page. Shining up the ‘Quality’ of the ads portion of the search results page overall could be an important part of maintaining user trust not only in any given ad, but importantly, trust and respect that the ads portion is worth looking at and represents a high standard of communications.

In other words, regardless of how it is achieved, Google appears to believe in a higher-order concept of relevance, independent of specific measures like CTR. Obvious means of achieving that might be to simply mirror some of the user’s keywords in body copy, etc. But less obvious might be: users feel funny about getting your brand offer with the brand name in the headline (say), when they have explicitly searched for information about comparison charts, or “best” something. To “spam” them (even slightly), the formula is going to ask you to either pay more, or to alter both your landing page and ad copy. Alter one without altering the other, and you’ll likely be deemed less relevant either way. There is going to be less of a free lunch even when you somehow manage to maintain a decent CTR. And if all advertisers do is change their ad copy slightly to annoy users less, that might be good enough for Google — not necessarily because one ad gets clicked more, but also because minimizing the appearance of some kinds of ads means that the ad space overall gets clicked more and respected more over time.

It could be other things, too. If Google knows and shows you that your Expected CTR is above average, but your ad creative is only average, that could be telling you that Google knows that your CTR will probably go even higher if you take steps to match the ad creative more closely to the actual keyword. You’re doing “well,” (possibly just due to elements like the granularity of your targeting or the appearance of your brand name in the Display URL), but Google knows that the odds are you aren’t doing as well as you could specifically with the ad creative. By trying ads with “instant buffalo wings” specifically in the ad headline for the query “instant buffalo wings” where currently your headline is “hot spicy wings,” you might generate even better user response — primarily in terms of CTR, but possibly in terms of response right through the buying funnel. Does Google benefit? Yes. Will you? Maybe.

Landing page quality: When this is below average, it could mean any number of things, more than I have space to go into here. In any case, this should put to rest the majority of people’s questions about whether their landing page is the source of their Quality Score woes. It either is, or it isn’t, and this new reporting will say as much. It won’t tell you anything about what is wrong, how serious the problem is, etc. But in all cases it will reinforce the point that this game is largely about…

User expectations.

Many have heard of the concept of information scent. This new Quality Score reporting just reinforces the idea that optimizing a PPC account revolves largely around removing that puzzled state that slightly-off advertising gives to a searcher. The more laser-perfect your sequence from keyword query and campaign organization, to ad copy, to landing page, and beyond — in relation to the user’s expectations and intent — the better you do.

Why does Google “get involved” to this degree rather than letting advertisers figure it out? Broadly speaking, it’s to help them learn this process on their own without actually privileging the interests of one advertiser over another. And broadly speaking, it’s to continue to address and weed out any sense of “spamminess” in the ads that stems from situations as benign as advertisers not thinking through different meanings for keywords, throwing too many keywords into an ad group assuming that they are all worth “a try” because the keyword tool said they were popular, etc.

Example: Competitor Words

There are some important specific cases, though, that illustrate the principles acutely. One of the main ones is the common practice (largely legal in most jurisdictions) of showing your ads when a user types a competitor’s name as their search. Think of three common scenarios here:

1. You’re advertising on your own brand name, and using the ad unit (including appropriate extensions) to extend your grip on screen real estate, test specific offers, etc. Here, your expected CTR relative to other advertisers will be way above average. Your ad relevance will also be well above average because you alone have the luxury of using your trademark in ad copy. And your landing page quality will likely be above average as well, because perhaps you are a respected brand name. It should at least be average. Put the three components together, and your Quality Score is often a solid 10/10 and virtually no one can dislodge you from top spot. You may be getting your clicks here for single-digit pennies per.

2. You’re advertising on a competitor’s brand name… and it is not going well. Previously, there was some mystery as to how this process worked. Your CTR might not be terrible, and yet your Quality Score keeps dropping so low that your eligibility is in the toilet and your CPC’s become prohibitive. But relative to the brand, your CTR is definitely not great. And your ad copy isn’t helping, because you don’t have the luxury of including the searcher’s keyword — the competitor’s name — in your ad copy. (It isn’t legal or allowed by Google and/or in most jurisdictions.) Remember, even on top of normal CTR’s, you could be dinged for the intrinsic lack of relevance of such an ad. And finally, users tend to get dissatisfied when they visit landing pages on ads for the other guy’s brand. Not always, but insofar as many users are ticked off, the formula will reflect that, too. That explains why most times, it’s not feasible to advertise on “competitor words,” and why that can all be done algorithmically to embrace far-reaching principles. It’s only a “cash grab” if you’re on the wrong end of it.

3. But sometimes, you can do just fine here. While you may take a slight hit on the ad relevance piece, what if your CTR’s are actually pretty high because your offer was pretty relevant, kind of cool, was thoughtful in challenging the supremacy of the leading brand, pointed to a helpful comparison chart, etc.? What if, furthermore, users actually liked and appreciated the landing page when they arrived? If and only if that’s the case, you might come in with Quality Scores in the 5-7 range, and thus be the exception that proves the rule: advertising on competitor terms is something that you must do with great care.

Has this new disclosure helped me immediately in crafting better ads or weeding out keywords that shouldn’t be there? Not really, for two main reasons: (1) I already think that way, and (2) we’re still watching the ROI data most closely, using Quality Score as a learning tool.

And the new reports are confirming some hunches that I’ve been working with for some time. Since we’ve been doing this a long time, my colleagues and I generally understand when we should expect to pay a premium for overly broad targeting (or overlapping, sadly, with non-commercial intents on ambiguous keywords), and when we’re going to get a bonus for really drilling down and matching very specific keywords to tightly-written ads (thus “above average” expected CTR). The reporting will also provide us with insight as to how Google is working to “rescue” ads if they are above average in relevance; and can remind us when keywords are average or even above average in relation to expected CTR compared with other advertisers, despite the fact that some keywords must toil in an “organic SERP’s are better” keyword universe that most users would rather not click ads for. In short, we now have more insight into whether a keyword is “in a tough space” or whether it’s truly a case of “you suck”.

Welcome, Frank Boulben, Research in Motion’s new CMO. You’re charged with making the Blackberry relevant again. No one expects you to succeed.

You’ll be surrounded by the din of detractors, media hacks, and a few people cheering you on. There’s a chance you’ll try to hit a home run when it would be so easy for RIM to get back on track by hitting singles and doubles.

My overarching hope is that you’ll see the importance of ignoring the deafening roar on all sides. That you’ll discover the power of marketing quietly. Of protecting your own company from mass market madness — and protecting your own customers from the same thing.

As I type this, I’m reminded of the brand American Apparel. I’m wearing a cotton cardigan made by same. Stylish, yes. Does it shout? No. Sure, American Apparel has frequently been in the press, as much for their “made in LA not in sweatshops” ethos to the lecherous behavior of the founder (and yes, plenty of stylish marketing).

Funnily enough, though, the clothes generally don’t shout. They’re “generic,” yet the cool kids sense you aren’t wearing a Hanes tee. As Naomi Klein might say – they have “no logo.” Yesterday I was out golfing [note to clients: it was 9 holes at twilight] when the wind started howling. Instead of official golf jacket / outerwear, I had an American Apparel thin sweatshirt (thick henley) in the bag. Put it on. Felt way less dorky than I would have in an Adidas shell to match my Adidas golf shirt. Functional, too. Great fit. Bold blue color. But no logo. No one told me how I had to use the product. It was my discovery. Hey, no one tells me what golf apparel I have to wear!

That saves me money, too. No need to shop in the golf shop and duplicate all the clothing I already have in my closet. It’s generic! You can use it for anything! (Even though it isn’t an unstylish kind of generic.)

To use the device analogy, many people are going to have one smartphone. They aren’t going to have a tablet or even an iPod. You weren’t off base when you released great Blackberries with good quality sound, better cameras, etc. — you do have a market if you keep releasing better and better ones.

Research in Motion should position and market its products quietly, like that. With quiet confidence that their fans are their fans. No silly contortions around the brand. Follow what the brand already is. Don’t graft imaginary personas over it. Let customers put themselves into the picture in their own way. Do you really think at this point that people need to have it explained to them that people come in all colors, all ages, multiple genders, etc.? That’s what I fear your next traditional ad agency is going to try to do.

Your product and your company never talked down to people in that way. Should your advertising?

Here are my three unsolicited pieces of advice, jumping off the theme of ‘Market Quietly’:

• Forget the mass market. Serve, understand, and sell brilliantly — and quietly — to your existing customers. Understand your fans. Make them happy. Don’t mass market to them. Better yet, don’t mass market to anyone else, either, in a way that would turn off your existing core.

• To do that, use the ‘database of intentions’ to recognize and respond to (and market to) that core group. You can save tens of millions of dollars, maybe hundreds of millions, by winding up the majority of the traditional advertising, packaging, and other “mass market” campaign work. For a fraction of the cost, you can effectively get your message out there to every single person that is doing a Blackberry-related search (and other super targeted online stuff). Display, Facebook, Twitter, LinkedIn. Master every single one of these channels. Build out a respectful and accomplished team that does nothing but that. Stop wasting everyone’s time, and your company’s money, with top-down mass market ad campaigns from the 1980′s. Use whatever is left over to focus on new forms of PR and earned media etc. etc., yadda yadda yadda. Free publicity is great, too.

• Leverage those communities and those massive amounts of signals from inquisitive customers to develop the products of the future.

Do all those things, and I’ll still be proud to answer my RIM phone on the golf course… though to be honest, I usually keep mine turned off. Golf types are like that. They also really don’t want to have to throw in the towel on RIM and switch to a (shudder) iPhone. Android? Can’t let Google take over everything. If you believe Apple and Google should take over everything, and that there is no fervent Blackberry fan base out there… or if you’d rather spend every morning reading the opinion pieces by ivory-tower journalists, wondering if your company is really populated by a bunch of clueless clowns or whatever… you might as well give up now.

At this point, with a powerful new OS and a global customer base still (somewhat) loyal to you, there is plenty to build on. And unlike the din in the press, in the real world fan base, people typing queries about your product as in the screen shot below, are simply interested and engaged in the nitty gritty details. [There's a lot more where that came from. Are you truly leveraging searcher intent? Are you building too many half-baked mass-market promo microsites, and not enough communities and resources?] They want to get on with their next phone purchase so they can get back to being quietly effective.

For years, SEO companies and “rock stars” have whined that they don’t get the respect they deserve.

That’s been unsurprising, given that you trip over seven unethical SEO firms and two “cheesy borderline” SEO firms out of every group of ten. If only 10% of SEO firms are really “agencies” that adhere to some professional standards (including a degree of transparency, contemporary technology & practices, etc.), how can clients figure out what to do and who to hire?

It’s been a little better on the PPC side, but here too, it’s pretty easy to set up a “facsimile of the real agencies,” hoover leads in the door, and start billing for substandard work done by a mostly nonexistent organization. The tipoff is the About Us pages that launch right into an unverifiable jumble of information pulled from other agencies’ websites, never identifying the actual principals of the firm. And sorry, if you’re out on the highway in the desert somewhere in unit #4518 (a self-storage unit maybe?), if I’m a client you’re going to have to do more to convince me to sign up.

To briefly touch on the agency side of things and how it’s gotten better for clients… I do think it has, because somehow word of mouth is getting better and buyers are getting smarter. If they are hiring a large agency, they do that because of the safety factor. Probably you pay more for a bit less specialization and get less of some things, but most buyers don’t have time or enough luck to make it through the mysterious effort of somehow striking gold with a lone wolf practitioner who turns out to be up to the job in all facets.

In the middle are interactive agencies or SEM-focused agencies with known track records (like Page Zero Media, to toot our own horn here). Buyers know that there are actually just a handful of leaders running SEM-focused organizations with any depth, and that you can actually meet with them and talk with them at the major industry events (SES, SMX, etc., along with emerging dark horse events like Heroconf and the Acquisio User Summit – on the latter, get a load of who’s keynoting). Anyone who gets to know “PZ” team members like myself, Mona Elesseily, Dean Towers, Scott Perry, Dave Weber, etc., will know that many of us have been at this for 11 years now, and we’re training the next generation of obsessives as campaign complexity continues to challenge clients who would flounder if they tried to run them on their own. We’ve been around this long, and we’re going to be around next year and the year after that. For execution help, advice, audience building, and networking opportunities, we also partner with some of the most important entities in the industry; longstanding relationships with companies like Google, conferences like SES Toronto, companies like American Express OPEN, and vendors like Acquisio, matter to us and to our clients.

To look around the landscape (this post isn’t just about self-promotion but about B2B consumer protection, in the end), I’ve been more and more impressed by the trend represented by (for example) Blueglass, an interactive agency that was the product of several established groups coming together, plus the recruitment of some top talent that might have been considered “lone wolves” in their earlier work. It’s just easier for clients if they can get more of that in the same place, without worrying whether Rock Star X has a full plate for the next couple of months. In short, we’re seeing the  emergence of an agency landscape out of what used to be a bit of a mess. That leads to more professionalism, and more safety and long-term execution for quality clients.

There are quite a few others worth a mention, of course. And they don’t have to be huge. Look at Marty Weintraub’s group at AIMClear – they’re rockin’ it.

Let’s turn to the tool side.

There are a lot of disparate tools, platforms, and dashboards out there that many agencies and in-house practitioners alike use to automate, report, research, and generally excel. Despite all the wondrous innovation, though, the problem for the firm (let’s say it’s an agency) is chaos. It takes time and money to be constantly researching and testing out new tools from new vendors.

I mentioned this when writing three years ago about the bid management space. Although new companies have certainly emerged in marketing automation, it’s probably fair to say that a few names have really solidified their grip on different market segments. As two fairly close competitors in the past, it was probably healthy and good for customers that Acquisio acquired (haha, Acquisio made an acquisition) ClickEquations.

One thing I love about Acquisio is that I don’t have to jump out into another tool evaluation mode when my agency has new needs. In addition to core PPC reporting and automation features, they integrate third-party data (for example, through partnerships with The Trade Desk and GShift Labs), Facebook ads, and increasingly, more sophisticated needs like multi-channel attribution. There’s a huge learning curve with some of this, but the key is that the learning is within the same consistent environment and the service and support is coming from one team, not ten. Our team can expect to be using that environment next quarter, and the quarter after that. In that regard, it’s not so dissimilar from using tools from Google itself. You don’t have to be constantly relearning features and environments, and the fact that you’re not paying for ten vendors and administering multiple logins is a huge win as well.

That brings us to the recent home run for SEOmoz, long considered the gold standard in SEO tools. $18 million in high profile venture funding is a validation for their role in the industry and no doubt for their sound finances. But more than that, it provides incontrovertible proof that they are one of the few players with Momentum. For many buyers, including myself, the likelihood of shopping around and trying a whole bunch of competing tools goes down when I hear news like this. $18 million isn’t something SEOmoz needs to run its operation, but it’s a powerful signal that they intend to be around for awhile — indeed, that they will be something of a ‘hub’ that builds out more interesting functionality that transcends ‘mere SEO’ (hence their tinkering around with a name change to just ‘Moz’). And to take it to a personal level, once again… this is all happening because you and I know who Rand Fishkin is, know he’s always been a thought leader and a tireless builder of this product. Maybe you even know Gillian, or other members of his family. It matters to me that a vendor has the courage to stand up and be visible rather than toiling away in a self-storage unit by the highway in the desert with a generic ‘About’ page. I think it probably matters to you, too.

I first learned about Momentum (a book subtitled “How Companies Become Unstoppable Forces”) from Noel McMichael, who co-founded Marketleap, one of the first small SEM agencies that managed to exit with a decent (if far too low by current standards) acquisition price. Noel told me to read Momentum. He said it had been the most influential book in the building of his company. Rather than behave as lone wolves who are good at some things, Marketleap built a cohesive and fervent (if relatively small) agency to signal to clients that if they hired Marketleap, they were getting on board with a group that self-identified as a professional organization that would take a back seat to no one in terms of execution.

Momentum means everything to vendor choices. Companies from Microsoft to Salesforce have created empires based on some of the most visceral of B2B buyer instincts: no one wants to waste time adopting the solution that won’t be the “standard” next year, and the year after that. Buyers want consistent technology, not just the latest technology. They want support and service, and organizations that can support learning and networking opportunities.

Many clients are still outsmarting themselves by hiring flaky, unqualified firms in order to save a dollar or two, but it’s getting better. Smart buyers know that the landscape is not as chaotic as it looks. There are a relatively small number of reputable agencies and software platforms to pick from. Those are the ones you’re going to be hearing from again and again.

No one likes to be the victim of a false positive. Every time you’re “randomly” searched in an airport, you curse under your breath and silently rail against the excessive security. Of course you would, because it’s happening to you. But at a system level, we all agree that we have to do anything we can to keep bad guys from hijacking planes or transacting the kind of business that leads to drug wars and general lawlessness that affects our daily safety.

I feel so strongly about that principle, I’ve taken it upon myself to barge into one-sided forums demanding the banning of airport pat-downs. There are some incidents and false positives, of course, but the answer is not to persecute hard-working security personnel or to make it really easy to wander onto an airplane with a weapon. All you can do is try and make the system better while minimizing some of the inconveniences.

I stated that case in one of those forums, and seconds after doing so, received an email invite implying that I should go join a “Nazi” forum. O-kayyy… surely there must be some balance between considering airport security trivial and the other extreme of living in a police state. You see travelers dress down security personnel all the time, when they’re just doing their jobs. I don’t think I’ve ever seen a single one thanked.

Analogously, there are considerable inconveniences in having an AdWords ad, account, or related site sit in a queue for awhile while Google decides that you’re not a criminal. But to put it in perspective, few have had to enrol in extensive counseling to deal with the trauma. It’s annoying, but the alternative is a bigger nightmare — the specter of a search engine space full of junk, where you can’t get seen because users have given up trusting most of the ads.

Sometimes, then, Google’s automated and human “scam-spotting” activity can affect a legitimate business. More rarely, it can make it impossible for a legitimate business to grow and flourish. In the affiliate and arbitrage marketing communities, and the “info product and aggressive offer” spaces to boot, this security regime has sometimes been trivialized by calling it the “Google Slap.” While it’s true that Google includes some of these kinds of businesses in its policy list of business models that may have trouble showing up in the AdWords system, what it’s trying to protect consumers from can actually be a lot more sinister than that. This runs the gamut from deceptive offers to out-and-out scams: phishing sites, malware, ripoffs, illegal or criminal activity, and more.

Many advertisers aren’t up to speed on the depth of Google’s effort in this area. I just had the opportunity to chat with David Baker, Director of Engineering, Advertising, at Google. He provided some additional insight into some of what’s behind today’s update on the official Google blog covering Google’s editorial and consumer protection activities in the AdWords program.

Unfortunately, the magnitude of the effort is much greater now than it was five to six years ago. “My sense is that there was a dramatic uptick in ‘bad’ and scam type ads in 2008 and 2009,” said Baker.

When consumers are duped or even defrauded, they may point the finger at Google. But more importantly, constant vigilance in upholding standards of trustworthy advertising is needed so that users don’t become gun-shy about clicking ads. Baker noted: “Success in this (editorial and consumer protection in terms of ad and account approval) area is Google’s greatest opportunity for increased revenue. It’s important to us that end users trust the ads.”

As pointed out in the blog post, Google increasingly relies on sophisticated pattern matching and machine learning to look for potential red flags at three levels: the ad, the site, and the account. This is combined with human intervention where serious violations are likely. From here, accounts can be suspended or closed, ads can be disapproved, or all accounts can be blocked from sending any traffic to specific sites.

This is to the extreme end of the continuum of vigilance that incorporates Landing Page and Website Quality into overall Quality Scores. If advertisers were looking for cues as to the degree to which minor user experience and relevancy problems are going to be factored into their Quality Scores and ad eligibility, in my judgment, Google currently has a “fish to fry” problem that is forcing it to devote many resources to playing “whack-a-mole” with the worst offenders. Minor website issues will not typically be a problem for Quality Scores and the resulting CPC’s and ROI.

Another takeaway must be that this strain on Google’s resources may mean slow ad approvals and temporary periods where Google’s pattern matching puts you in a suspicious category. It’s natural to be outraged — “how could they take all that money from Canadian pharmacies (Google paid a $500 million fine for knowingly doing so), and then leave our ads for legitimate medical equipment in limbo for so long just because an algorithm says it overlaps to a certain extent with a suspicious category or pattern? Don’t they know it’s *us*?”

Unfortunately, there are a lot of “us’s” and too few humans at Google (even with a significant increase in resources) to offer speedy approvals at all times. Google may decide to err on the side of consumer protection rather than reducing friction for advertisers.

That being said, Google dislikes any such friction. It does not wish to take steps to make it harder to advertise in general. Baker noted that Google had studied “barriers to entry” like a $1,000 bond (or more), but that overall the system has been such a boon for so many small advertisers (with a hacker mentality, if you will) that it would be a shame to move to a slower-moving ad setup process.

Like many of you, I’ve seen a lot of gray-area ads since I’ve been in the business. In particular, I often feel strongly that a client is getting a raw deal from the auction in light of an unscrupulous competitor’s false claims or — if not literally ‘counterfeit goods,’ then substandard quality that makes a mockery of direct price comparisons. Some competitors also like to rip off content and ideas, even taking the family bios and histories of my client and claiming them as their own. We had one national ecommerce client whose most unscrupulous lookalike competitor was the founder’s own son.

It now seems that Google will be fighting so many battles against hardcore bad guys, it will be difficult to see much movement in any attempts to complain about lesser ripoffs. Resources aren’t infinite, and there is probably no good way to police some of it anyway.

Quite simply, that’s where consumers have to come in. When they receive shoddy goods, etc., we need them to get on various third-party sites and make their voices heard. Google will have to pour far more resources into building and policing their own review platform as well, or that will become merely another platform for gaming by bad actors. Finally, Google is building a Trusted Stores program that will presumably elevate a minority of retailers to a rock-solid status as uncommonly trustworthy.

Google willingly took on the mantle of what they call “organizing the world’s information” — a task that implies “ranking what’s best,” in the minds of many consumers. Along the way to becoming vastly successful in mediating an enormous open marketplace of ideas and commercial messages, Google has assumed a huge burden as a “certifier” of what consumers can trust. Due to the scale, it’s a job that is vastly harder than test-driving a few cars from known manufacturers. That’s why, at times, I have referred to Google as becoming almost like a government (“the guvernment“). While it may be great to be “in power”… it’s also a case of “be careful what you wish for.”

What’s amazing, given the persistence of bad guys with credit cards, is that problems with rogue advertisers aren’t much greater than they are. Google reportedly suspends or closes in the hundreds of thousands of accounts per year. A Google spokesperson also informed me today that Google routinely passes on information about suspicious parties to the legal authorities.

I’ve been working hard for years to explain this paradox. Google wants advertisers’ money, but it must often turn away money if the result will be user dissatisfaction. Legitimacy and trust are currency for a search engine. I still remember the conversation I had in a pitch meeting at a venture capital firm, for a startup I’m involved with. I tried to explain how businesses like Yelp and Google must sometimes incur the wrath of paying businesses, because their overall legitimacy depends on users, which in turn provides the basis for a large advertiser base in general.

One of the partners lectured me condescendingly: “I don’t think Google is in the business of turning down advertiser dollars.” He was wrong then, and he’s wrong now. Google often turns down a lot of specific advertiser dollars in the short run so it can make more from advertising in the long run.

Baker closed his post by noting that he will go on “fighting the good fight” against bad ads. Next time you stop by the Googleplex, maybe you could thank him — if for no other reason than to watch him fall off his chair.

Following a positive earnings report, Google’s stock took a beating for two days running after having risen close to an all-time high in the days before the earnings announcement, dropping from about $650 to nearly $600 before rebounding today. What caused the selloff?

Four factors seem to be relevant to the selloff in the midst of what seemed like massively positive financial news:

(1) A simple “sell on news” response to anticipated good news, based on a valuation that had already run up in anticipation of a positive outcome.

(2) After taking awhile to digest, the news that average search CPC’s declined significantly year over year began to sink in more with Wall Street, and this dark cloud outweighed the great news about the actual current cash flow.

(3) Regulatory and legal headwinds: major government privacy and antitrust investigations are ongoing and being renewed from various angles, and Oracle is suing Google for $6 billion.

(4) What sounded like it might be a positive use of cash from an investor standpoint — the announcement of a “dividend,” morphed into a “dick move” whose purpose was to issue more nonvoting shares to further solidify the founders’ share class and iron grip of control over the company by Page and Brin (and to some extent Eric Schmidt). Outside advice and input from shareholders, this signals, will be treated with increasing levels of indifference. Wall Street can think as one mind on issues like this and at least temporarily, seek to punish companies for transparency problems and governance structures the Street doesn’t like.

All of these factors probably had something to do with the selloff, but which really matters? #4 is probably the least likely to stick over the long haul. Markets and Wall Street cannot really “think as one mind” on corporate governance issues — opportunistic money is always going to jump in and scoop up shares if the price is right, defecting from any unspoken pact to uphold broader shareholder or Wall Street interests in a showdown with some relcalcitrant geek execs.

The issue is #2, but it’s unclear whether it should be an issue. Naturally, stock analysts want to look to the future to understand growth potential. What’s the mix among Google’s core and new businesses? How mature is the core business? Will the new businesses be high margin? A lot of number-crunching needs to go into finding an appropriate valuation.

Wall Street has known that Google would be an amazing financial juggernaut for many years, though it still had to play catchup after the IPO, where it underestimated the potential. The markets, over the long haul, have told the Google tale pretty well. If you were smart enough to understand the company at IPO time, you had a great return. The return in the first five years of the company’s status as a public company were phenomenal.

But Google’s stock has offered anemic returns in the past five years, during the time that it actually enjoyed its most eye-popping financial success. The stock has appreciated just 32% over the past five years. Since the beginning of 2012, it’s down 4.6%.

What do those dropping average CPC’s on search mean, anyway? Google won’t share full details, but at the end of the day it’s definitely fair to say that the search ads market is becoming mature, and future price increases in clicks will be gradual at best.

The Street may have made a slight mistake in diagnosis, however. For the year over year click price average to drop so much, it’s probably not coming from competitive keyword auctions across the board. Sure, some times are tough economically, but many advertisers are still growing and optimizing and are willing to pay premiums for good keywords — more so with each passing holiday season, especially. What has likely helped to drive those prices down is a relaxing of the stringency of Quality Scores at the low end of the auction. So that former white space in the “informational” query stream is now showing more ads selling in the range of a few pennies up to 30-40 cents. Why did Google loosen that up a bit? Probably to earn more total revenue (with no harm to margins). Wall Street may have assumed that a ton of advertisers are willing to pay less for “core” clicks. Not true.

Even with that error in judgment, though, Wall Street may be correct in its assessment of Google’s P/E ratio as fair in a modest range of 18-20. Google’s new lines of business have massive potential. Some are high margin, others are huge question marks. But the maturing of the very high margin core search ads business was inevitable, and eventually growth slows to a crawl. When the markets see evidence that Google’s mobile ads, display ads, social network, and other huge pushes are actually working from a financial standpoint enough to outweigh the risks and costs, it’s at that point the valuation might start to be a bit more forward-looking again. For now, everyone recognizes that Google is an amazing financial machine today, but the majority of analysts aren’t placing any huge bets on the Google of the future. That’s probably not a lack of recognition of the potential of Android, display networks, and all the rest; just a cautious balancing of those trends against the headwinds of regulators, lawsuits, competition from Facebook, possible blunders and distractions, etc.

In the meantime, the “mature” (ho hum) search ads business is incredibly robust, and on quality keywords, click prices aren’t really dropping across the board. Some industries have seen slight pullbacks, and some reckless advertiser behavior has been scaled back. Sounds like the kind of caution by advertisers you might expect in the second deepest and longest U.S. economic downturn in history. Just don’t get too comfortable with the idea of rock-bottom click prices on quality keywords. In this regard, Google’s financial reports are vague at best.

In my role as a member of the SES Advisory Board and past Chair of this conference, I’m here to remind you that SES Toronto is but two months away! And that means we’re looking to have the final session and speaker list wrapped up in  2-3 weeks.

For now, we’re wide open to your pitches for existing sessions, or pitches for new sessions. While you may see a set-looking agenda on the website, keep in mind that for the time being, it is only a draft. By all means pitch.

A couple of background notes:

• As always, pitching formally through the form (linked from the speaker guidelines page) is an absolute must. It may seem like a formality, but it’s too messy to have people informally expressing interest to individuals on the content team. Unless you are Avinash Kaushik, pitch like everyone else, please!

• Speaking of Avinash, Google’s Digital Marketing Evangelist, we’re very pleased to welcome him to the Toronto conference to present fresh keynote material. A brilliant presenter and a longtime favorite in the Toronto market, Avinash will galvanize you to better tie your analytics and measurement activities to business results, and to think more ruthlessly about your analytical routines. His blog isn’t called Occam’s Razor for nothing!

• If you’re pitching a session or just yourself as a speaker, it’s worth noting that in this market some perennially popular themes involve real world enterprise level (midsize to larger company) case studies, Canadian themes and examples, and credible technical information that can translate directly into improved conversion rates, search rankings, ROI, or user delight.

• Globally, SES has worked relentlessly to keep its content fresh, relevant, and on the leading (if not bleeding) edge. The show’s acronym now stands for Search and Social, and our advanced-level pilots (such as SES Accelerator San Diego) have gone over very well. We’ve heard what the market has been asking for, and we’ve responded. We’re all about no-nonsense, top rated speakers mixing intermediate-level updates with more advanced material, to really stretch your mind and your capabilities. There are only two introductory-level sessions in this entire SES Toronto program, so if you’ve heard that “SES is the show with training wheels,” put that myth to bed. Only if by “training wheels” we mean top-rated sessions, top speakers, great networking, by far the largest SEM + social conference in terms of numbers, and a cast of advisers who travel the world and meet regularly to inject fresh directions into the conference in response to attendee feedback.

• For attendees who need more in-depth training, that is offered at every SES show. Toronto training workshops information is here.

• I’m looking forward to meeting you there. I should be speaking at the event, as usual.

And to make it even more interesting, I have a number in mind. That is the number of consecutive North American SES Events I have spoken at going back to my first one ever. That string remains unbroken at ___, counting the upcoming Toronto conference. If you reply in the comments with a guess as to the number… the correct guess will receive a delicious candy gift from Nuts.com. Second prize is a free book.

According to her LinkedIn profile, longtime friend and SES Conference colleague Marilyn Crafts is now a “Retired Event Planner”. It seems like only last week that she was spearheading the usual great success of SES New York. Well, actually it was. And that makes it feel so abrupt.

Frank Watson is encouraging people to say hello in the comments of his post over at Search Engine Watch, but another post here seems more than fitting.

Marilyn – unlike many people – scarcely needs a LinkedIn profile. For the past twelve years, she has been the glue that holds together the world’s leading search marketing conferences. Whether in content planning meetings, speaker invites and logistics, on-site operations, or as a member of the SES Advisory Board, Marilyn was a driving force. Without her, quite simply, the show could not have gone on.

There isn’t a lot of downtime when you have to work full time to make it all happen — but that being said, it beats a lot of jobs, right Marilyn? We got to see all those great cities together and enjoy the great company of the team, whether under the shadow of Big Ben or the CN Tower. Add to that the opportunity to see big time digital media politics as they unfold behind the scenes, to meet and greet all those famous keynote speakers from cantankerous to brilliant and everything in between.

As a longtime speaker, many people would assume I don’t need any soothing or reassurance. But of course, given stressful schedules and above-mentioned politics, sometimes I did. I always appreciated it when you had my back and were there to reassure me. Most recently, giving me a pat on the back for a cheeky column I wrote for the Acquisio blog, which I suspect appealed to you because of its implied subtitle “Talkin’ Bout My Generation.”

I know you will probably miss a lot of the glitz and glamour of the industry, but I know there’s a big part of you that won’t miss the endless travel and stress. Enjoy the happiest of retirements!

Google says it is retiring the Demographic Bidding functionality in the Google AdWords display network on March 21.

This was typically a weak and incomplete layer on the AdWords platform, as it relied on information reported by websites, presumably through third party data collection services such as Quantcast. AdWords had no direct knowledge of specific users’ actual demographics. As such, this method of targeting was caught up in the old publisher-based paradigm, rather than being user-specific.

That paradigm isn’t going away entirely, but many advertisers seek the power of targeting based on the user’s actual profile, not just what the publisher thinks of its user base in the aggregate. As most everyone knows, Google’s sweeping entry into social media with +1, Google+, and the collapsing of Google user privacy policies into one mega Google user profile, is all a precursor to allowing advertisers to engage in more sophisticated and precise behavioral targeting.

So, as demographic targeting 1.0 goes to sleep, we await:

• The ability to control bids by user characteristics, in a much more sophisticated and accurate fashion;
• The ability to do this not only for display ads, but for search ads!