From a smoky 3rd floor Internet Cafe in Kuala Lumpur

Bill Gates, Overture and the Crocodile

September 7, 2004

Dear Friend & Subscriber,

In today’s issue:

– Crocodile confrontation
– Overture takes a beating in Oz
– 27,700 miles of Serendipity

The crocodile didn’t eat me.

I ate the crocodile.

The only crocodile I met in Oz was the one in my salad plate – in my Macadamia nut and crocodile Meat Spinach Salad with Raspberry dressing.

And I kid you not, it was hands-down the best cuisine I sampled in Australia. Absolutely fantastic. (The mashed potatoes and Kangaroo Meat with gravy were outstanding too – Roos are kind of ‘gamey’ tasting, but that’s fine by me.

There was only *one* part of the X10 seminarthat wasn’t received with tremendous enthusiasm, and that was Overture.

(Overture, Google’s rival search engine in the Pay Per Click game, powers Yahoo, MSN and many other search engine. Originally GoTo.com, they pioneered the PPC concept which has totally revolutionized the web.)

Overture sent a couple of representativesto the seminar to give a presentation, and things started going downhill when a woman who’s relatively new to this stuff asked a rather innocent question:

Attendee: ‘Let’s say my business does window screen repair and there’s suddenly a hailstorm in Sydney, and I want to get on the web right away and advertise that I repair hail-damaged windows. How long does it take before my ad appears?’

Overture: ‘Why would you want to do that?’

Attendee: ‘Because I’d like people to come to my website right away and have me fix their screens because of the hailstorm.’

Overture: ‘But that’s not what you do; you just fix screens. Your business isn’t about hailstorms.’

Attendee: ‘Yes it is! And if there was suddenly a hailstorm, I’d like them to find my website right away and ring me up.’

Overture: ‘But if your website doesn’t have any pages about hailstorms, we can’t approve your ad. Your website would have to be about wind screen damage from hailstorms, because we have very stringent relevancy requirements so that people who search get only the best results.’

Attendee: ‘So if I put up a page about hail storm damage repair, how long does it take for my ad to show up?’

Overture: ‘3-7 days.’

Attendee: ‘3-7 days??? Whatever for? People want to fix hail damaged windows today, not 7 days from now.’

Overture: ‘That’s why it’s really important to already be advertising with Overture, even if your bids are really small, so that if something like this happens, you can increase your bids and become more visible, which only takes 2 minutes. We only charge you a minimum of $25 per month. Otherwise your ads would need to be approved by our content editors, which takes 3-7 days.’

Attendee: ‘OK, so let’s say my ads are already running and I just want to change them to say I repair hail damage, how long would that take?’

Overture: ‘Why would you want to do that? Your ads already say that you repair windows.’

Attendee: ‘Because if a hailstorm just happened, and people would be thinking about hail damage.’

Overture: ‘Why would you want to do that?’

Attendee: ‘Because we’re marketers!’

Overture: ‘You need to understand, we have a very stringent editorial process to make sure that only ads that meet our 80 pages of content requirements are approved, and people who search only see the most relevant possible listings from our advertisers.’

And so it went. ‘Overture, we want your service to be instantaneous, not take 3-7 days.”Oh no, Mr. Customer, our editors know better than you and we’re not going to let your ads show up right away.’

Needless to say the conversations in the terrace after that particular session was over were… um, pretty humorous.

This was accented by the fact that on Friday I had just built a Google campaign for a brand new product, live in front of our audience, in about 10 minutes.

It was for Ken Giddens’ ‘Make Your Dog Stop Barking’ book, and on Sunday I came back having successfully tested five different ads. The response to various ads had shown us that people are more interested in getting their neighbor’s dog to stop barking than getting their OWN dog to stop barking.

Pretty useful piece of info, don’t you think?

The audience loved it. It was the speed of the process that made the example so useful. Had we used Overture, the ads wouldn’t have even started showing until after the seminar was over. A lot can happen in 3-7 days, you know.

The representative from Overture said that some terrific improvements are in the works, but bypassing the 3-7 day editorial review process is most definitely not one of them. She stated flatly that they will never change that.

Now honestly folks, I would LOVE for Overture to be instantaneous like Google is. I love a good competition, especially when I’m the customer.

I would love to see Overture improve (or should I say fix?) their system. And regardless of their flaws, if you’re advertising successfully on Google, you should definitely try Overture. You might double your traffic that way.

But Overture won’t listen to their customers.

I think I know why.

It’s because they can’t.

Why can’t they?

Because they don’t control their own destiny.

Overture’s partner sites control their destiny. They HAVE to police all the content, because it gets shown on other companies’ sites. All the content that Google syndicates gets approved by a human editor first, too. But on Google itself, listings show up immediately. This makes all kinds of fantastic testing and experimentation possible on Google that cannot be done on Overture.

I suspect that a shark tank full of lawyers makes it impossible for Overture to listen to its advertisers, who give them over a billion dollars a year.

This is a big, big problem for Overture, and if they don’t solve it soon, they’re going to have even bigger problems. Here’s why.

Everyone knows that Microsoft is eyeing the search market like a famished Australian crocodile watches a potbelly pig. Google and Overture figured it out first, Bill Gates missed out on search, and MSN hopes to take back what Mr. Gates believes was rightfully his all along.

So the pundits pontificate about what Microsoft will do to Google. But Google’s not so vulnerable to Microsoft.

Overture is.

So here’s what Microsoft does:

They go to every advertiser whose listings are syndicated on MSN through Overture and they give them a ground floor opportunity to advertise on MSN instead. They know who all these people are – after all, the results are showing up on their own search engine every day. Right?

Gates always said, ‘Keep your friends close and your enemies closer.’

So MSN gets started selling PPC, and then MSN goes to all the other search engines and offers them 100% of the money instead of 1/2 or 2/3rds of the split. What sane businessman would turn that down?

Heck, I wouldn’t be surprised if the next version of Windows had an ‘Advertise your business on MSN’ icon on the desktop.

Overture would have only Yahoo left as a partner, because Yahoo owns them.

It’s the sort of Bill Gates style coup that destroyed Netscape, and it’s just waiting to happen.

Because remember, Overture doesn’t own the eyeballs, their partners do. And Overture advertisers aren’t nearly as ‘in love’ with Overture as they are with Google. Overture isn’t a cult phenomenon; Adwords is.

Please understand, I don’t *want* this to happen. I don’t have any affection for Bill Gates, believe me. But this scenario could play out if Overture doesn’t change with the times. I would LOVE to see Overture provide us the kind of instantaneous creativity that makes Google AdWords so addictive.

T h e X10 S e m i n a r

I’m biased so I’m probably not the best guy to ask. But in my opinion, a more thorough Internet education for both beginners and advanced marketers has never been provided anywhere. Every single speaker delivered 3+ hours of his very best & latest content with no pressure to pitch a product. And every student went home with everything on CD so they can listen again. I heard nothing but rave reviews from attendees.

27,700 miles of S e r e n d i p i t y

This morning I landed in Kuala Lumpur, Malaysia. Right now it’s noon in a cybercafe on the 3rd floor of some crazy building downtown. It’s kind of dark in here and there’s rap music playing and video games. This computer I’m typing on has annoying adware that keeps popping up every time I do a search.

How did I wind up in a Malaysian cybercafe?

By deliberate accident, really.

My wife’s brother Alan runs a relief organization that helps kids in 3rd world countries and they have a project in Nairobi Kenya. I’m kind of curious about this, so I asked the travel agent if I could go from the US to Australia to Nairobi first, before I go back home.

Basically he said ‘If you want to get to Nairobi by any sane, logical route, it’s going to cost you an extra $6500.’

Six grand? I don’t think so.

But Peter says ‘Let me see if I can get you there another way.’ So he checks and shows me how I can save $6500 if I fly from Chicago to Fiji, to Brisbane, to Kuala Lumpur, to Singapore, to Dubai, then to Nairobi and to London and back to Chicago.

That’s a complete trip around the world, which is 27,700 miles.

Yeah, I know… to some people that sounds like a desolate wasteland of airplanes and airports and horrible jetlag. And very, very strange food.

But to me that sounds like fun. Just have to make sure I spend a couple of days in each place.

So I said to Laura, ‘Ummmmm…. I know you’re already going to be keeping four kids for a week and a half… um… what would you think if I also spent an extra week and visited Malaysia and Singapore and United Arab Emirates?’

She says, ‘Hey buddy, you already owe me so bad from the last two trips – what the heck, you might as well. Just remember though, you’re going to owe me big time now.’

So here I am.

The unplanned parts of any trip are usually as good, if not better than the stuff you plan. So I’m all for serendipity.

Next stop: The Petronas Towers, which are the tallest buildings in the world. Oh, and gotta grab some Panang Curry…

Almost forgot: it’s Labor Day in the US – hope you’re having a great day off!

Perry

P.S.: Not making this up – a few hours after the Overture discussion about the hypothetical hail storm in Sydney… there just happened to be a hail storm in Sydney. Broke a few windows, as I understand.

Go on to the next installment: Kamikaze Street Vendors, Globalization & Z-Man