Google Aquiring Urchin
Google announced yesterday they are aquiring Urchin, a company that specializes in web analytics. From the press release:
Urchin is a web site analytics solution used by web site owners and marketers to better understand their users’ experiences, optimize content and track marketing performance. Urchin tools are available as a hosted service, a software product and through large web hosting providers. These products are used by thousands of popular sites on the Internet.Google plans to make these tools available to web site owners and marketers to better enable them to increase their advertising return on investment and make their web sites more effective.
“We want to provide web site owners and marketers with the information they need to optimize their users’ experience and generate a higher return-on-investment from their advertising spending,” said Jonathan Rosenberg, vice president of product management, Google. “This technology will be a valuable addition to Google’s suite of advertising and publishing products.”
According to a tip received by John Battelle, the price Google paid was in the neighborhood of $30 million. He also notes that many web publishers were using Urchin to understand their ads better, and since pretty much everyone else was using some random analytics package, Google apparently decided to buy one to make easily available to everyone. Maybe Google could think about integrating a consumer version of it into Blogger at some point, so users can stop complaining about the lack of visitor statistics. Greg Linden says:
The deals are coming fast and furious lately. Gannett, Knight-Ridder, and Tribune acquired Topix.net. IAC acquired Ask Jeeves. Ask Jeeves acquired Bloglines. Yahoo acquired Oddpost, Farechase, and Flickr. MSN acquired Lookout. Google acquired Keyhole and Picasa. Looksmart acquired Furl.net. Mamma acquired Copernic. Six Apart acquired LiveJournal. Whew!
Silicon Beat suggests this is a countermove to MSN’s ad offering, which will give advertisers enormous demographic data on potential ad clicks.
Google’s move comes just weeks after Microsoft announced it’s starting a search engine advertising service. As we wrote in our story, Microsoft hopes to differentiate itself from Google and Yahoo “by offering advertisers more detailed information about users who click on their ads. The company will cull this information from users who are registered on the MSN network and by observing their behavior and interests as they click from Web site to Web site.”
If this is some sort of response, its a weak one. Google should not be trying to beat MSN (and eventually Yahoo) at a game it can’t possibly win. Google will never be able to offer the data those two have amassed with their single logins and massive content sites. What it can offer are better algorithms for ad matching and a larger userbase. It should be focusing on its own strengths, not MSN’s. Don’t get me wrong; if this is simply a value added offering for advertisers, its a good one. I just hope Google isn’t falling into a mode of playing catchup to Microsoft. Microsoft has been playing that game for years to other innovators, and it hasn’t exactly work for them.
UPDATE: Danny Sullivan weighs in:
One reason to jump into web analytics is that the search companies understand that as search ad prices rise, people will only be willing to pay more if they can justify this by showing better conversions. Web analytics can help those who aren’t tracking conversions or who are tracking conversions at only a basic level to better understand the full picture of what happens on their web sites. For more on this, see my Most Conversions Happen Offline; You Need To Measure These! post.This is one reason why both Yahoo and Google already offer free conversion tracking tools to their advertisers (Yahoo info here; Google info here, though the link to the page with more info on the tool has disappeared). Providing full web analytics may help companies improve conversion even more. Yahoo already owns web analytics technology that it obtained through its 2003 purchase of Keylime. Now Google joins the club.
Oh, and just to be clear, I wan’t insinuating that doing something Microsoft is doing is a bad thing, just that Google needs to be certain of its motivations. I just hope it isn’t going to try to play catchup to anyone else, but rather blaze its own trail.
UPDATE 2: Andy Beal thinks it has less to do with providing advertisers with statistics and more to moving towards a pay-per-conversion pricing model, much like Snap’s. If that’s the case, this is a much smarter move. We’ll have to wait and see.
As Google stated, the main reason for this acquisition is to be able to provide AdWords advertisers with data that demonstrates the ROI of their ads, and encourage them to spend more with Google.But what about this idea? I wouldn’t be surprised if this were a step closer to offering a performance-based pricing model. With the tracking offered by Urchin, Google could move towards a product that only charges an advertiser when a transaction is completed.
UPDATE 3: Donna at SEO Scoop worries that Google having access to a site’s detailed usage data is an enormous conflict of interest.
Scary thought of the day… Google is buying Urchin, a major web analytics software product, and this worries me. Not only do I envision Big Brother looking at my web stats, but I can visualize Google being able to make ranking decisions based on those stats. If your site sees a lot of visitors leave after 3 seconds of looking at the home page, will Google decide to rank your site lower? Of course, I have no idea what Google will actually use Urchin for, but the possibilities of what they COULD use it for is what scares me. Paranoid? Maybe, but I like to think ahead to what may be…and the maybes in this case are not pretty. Google, keep your fingers out of my pies, okay?
So, so, so not paranoid. Google needs to promise right off the bat that the ranking algorithms will be deeply seperated from any Urchin data. Good call.
it’s so sad to see that you are well off-the-mark several times in this post. Got your morning caffeine?
Comment by John | March 29, 2005
Care to elaborate?
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And why is my CSS going screwy?
Comment by Nathan Weinberg | March 29, 2005
I’ll wager a guess on the CSS (just a guess). Could be too much demand on the server. It fails to fufill the request for the CSS file. That’s assuming that the CSS is located in separate file.
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As for Google, I think they have to add some basic functionality that their users want. Certainly, helping publisher get more effective use out of AdSense is worth their money even if no users were asking for it.
Comment by Nicholas | March 29, 2005
Nicholas, I’m pretty sure its more of an AdWords play than an AdSense one. Google’s advertisers are their most valuable commodity, followed by searchers, then AdSense sites.
Comment by Nathan Weinberg | March 29, 2005
True, but I was looking at it from how I use Google. In other words, how is it going to benefit me. Ah, maybe that was too self-centered.
Comment by Nicholas | March 29, 2005
An interesting thing to note is that apart from some acquisitions like picasa and blogger, other acquisitions of google like keyhole and now urchin are self-sustaining businesses. These businesses were already making profit selling their own products and they could continue to do so after being acquired too. On the other hand I noticed that most of the acquisitions made by Yahoo weren’t making any or much profit on their own. So, looking at the long run Yahoo might be collecting liabilities. Just a thought.
Comment by Nirav Patel | March 29, 2005