Google and "Advertising Arbitrage"

Everything You Didn't Want to Know About Blog "Plumbing"

Want to know why -- amongst other reasons -- Google is a $200 billion behemoth?

Because it collects big bucks from advertisers to place their ads on millions of big and tiny Web sites, blogs, etc. (mine is decidedly in the latter camp).

Meanwhile, Google essentially auctions off the English language, one word at a time, to the highest bidder via a phenomenon called "sponsored search."

Tom Sawyer, who got paid both by the homeowner to paint their fence, and also by neighborhood kids for the privilege of actually painting it, would have been impressed.

Want to know who paid Google the most for "car?"

Type in "car" on a Google search, and you'll find out.

Raw Deal, or, "AdNonsense"

On the back end, Google promises to share some of its advertising revenue with content providers like this blog.

Through a program called "AdSense," Google software scours your online content, and "serves" ads that appear to be related.

Hence, current ads on the City Lakes Real Estate blog touting "Premium Deicing Road Salt" and "Roof Ice Melt Solution" -- thanks to my recent posts on ice dams (not to mention regularly serving ads from competing local Realtors -- something that I find especially annoying).

Call it "advertising arbitrage": charging a pretty penny for the phrase, "premium deicing road salt," while paying content providers practically nothing.

"Advertising Arbitrage"

How little?

After three years of blogging and almost 70,000 page hits, my cumulative Google ad revenue will barely buy . . . a steak dinner.

For one.

Meanwhile, the one time I signed up to buy ad words -- terms like "Twin Cities real estate blog," "Minneapolis real estate blog," etc. -- I literally had to scramble to unsubscribe after my bill tripped $100.

In less than 72 hours.

Nice business . . . for Google.

So, thanks, but no thanks.

Early in 2011 -- that would be about a week -- you'll see a brand, new-and-improved City Lakes Blog, no longer tied to Google, and with much more functionality and a slicker design, to boot.

P.S.: Kudoes to the superb Tim Elliott, Web developer par excellence, for his help with the transition ("emancipation?").

Mill(stone) Rate

2011 Hennepin County Property Taxes

Every time I think I'm a Democrat, they do something stupid. Every
time I think I'm a Republican, they do something greedy.

--Jay Leno

What do you call proposing to steeply raise property taxes against a backdrop of weak home prices and an economy just emerging, maybe, from recession?

How about, greedy and stupid?

Like a couple hundred thousand other homeowners in Hennepin County, I got my proposed 2011 property tax statement yesterday.

My assessed tax value: down 3% from last year.

My proposed 2011 property taxes: up 12%.

WTF?!?

Add: Arrogance

How can property taxes being going up at the same time assessed tax values are going down?

Because of something called the "mill rate," or the percentage tax levied on each $1 of assessed value, which has been increasing.

Good thing my Realtor's income, 401(k), and interest on my savings have all gained so smartly the last year, allowing me to easily foot that increased property tax bill.

Not.

Most homeowners -- myself included -- will figure out some way to come up with the extra dough.

But we'll have to compensate by finding savings elsewhere.

Such does not a robust recovery make.

P.S.: And no, I'm not expecting a 12% increase in the services I receive for my increased property taxes.

A Realtor's Take on Recessions & Booms

"So, How's the Market?"

"A recession is when your neighbor loses their job. A Depression is when you lose yours."

--uttered by Presidents Truman and Reagan (and many others)

Little remarked -- but equally true -- is the converse: a "bounce," at least in the real estate business, is when you are busy; a "boom" is when you're swamped.

That's regardless of what's otherwise happening in your office, the overall market, various parts of town, etc.

After a torrid May-Sept, and a quiet(er) October, I am personally very busy heading into Thanksgiving and the year-end.

The principal caveat: Buyers now are expecting -- and getting -- deals.

P.S.: A colleague characterized this market as one in which "Buyers are getting the last word."

I'd go even further: Buyers in today's market are getting the last sentence -- or paragraph.

Dear Google: Please Get Your Sh*t Together

Message to Google (See Above*)

Don't be evil.

--Google corporate motto

I suppose it's the blogging equivalent of losing an election to a deceased opponent, or "none of the above" on a ballot.

What am I talking about?

Routinely being buried on Google's search engine rankings by dozens of other Twin Cities real estate blogs.

That's quite an accomplishment, given that there aren't dozens of such blogs; charitably defined (see next), I come up with no more than 8-10 real estate blogs locally (including some truly excellent ones, by the likes of Aaron Dickinson and Teresa Boardman).

What constitutes a "genuine Twin Cities real estate blog?"

My three criteria are: 1) regular posts -- if not daily, at least multiple times weekly; 2) original (vs. "borrowed" or syndicated) content, with a consistent point of view; that 3) regularly discusses and analyzes the local (Twin Cities) and national housing market(s), respectively.

Bone to Pick

So, if you search "Twin Cities real estate blog" on Google this morning, what will you find?

Here's a (partial) roll call of putative Twin Cities real estate blogs that currently out-rank "City Lakes" (which, for the record, pops up 17th in response to the query, "Twin Cities real estate blog"):

--"Living Twin Cities" (#9): last three posts are Oct. 5, Aug. 11, and July 20 (less content than I've posted this weekend).

--Pete Aplikowski's Real Estate Blog (#7), featuring all of three posts in October, and none yet in November.

The blog's solitary September post largely consisted of this zinger:

If you know anyone who needs help renting their property, please let me know. Sometimes it makes more sense than selling it given the current market conditions. I can handle all the details, showing property, drafting lease, etc.. The fees for this are very minimal compared to selling.

--"Minneapolis Real Estate Blog" (#5): Visit this one and you'll see that the author abandoned the blog in favor of a new-and-improved one last April; the post prior to that is from July.

July, 2009.

Search Engine (Dis)Optimization

Honestly, I'm delighted that anyone reads my blog.

And I certainly wouldn't expect every Realtor-blogger out there to generate original, quality content on a daily basis.

Or for Realtors to blog at all.

But that hardly explains getting lapped by less active (or defunct!) local realtor blogs.

So what does (explain it)?

Pay-for-Play

I'll leave the search engine algorithms to Google's quants, but you'd certainly suspect one (or a combination) of these explanations: 1) Google searches can be gamed; 2) Google searches aren't so smart after all; 3) they're bought and paid for.

Can you say, "pay-for-play?" (or more to the point, "Google Adwords").

If it's #3, how about ditching the false piety (see, corporate motto) and providing disclosure to that effect ("our search results are dictated by corporate sponsors")?

And to think, all this from the search engine not owned by Microsoft (don't even get me started on "Bing").

*The graphic above shows the number of visitors and page views for City Lakes Real Estate from Sept. 15-23.

The "spike" (statistical middle finger) was Monday, Sept. 20, when my post on Elizabeth Warren ("The Wall Street Journal Whiffs on Warren") got picked up nationally.