Internet Idea gets Torn apart by Google
An interesting Internet Marketing article about a company who's business model is considered a little sketchy by "white hat" SEOs- you pay people to blog about your product.... here is the article:
All Google had to do was futz with its search algorithm, and the entire PayPerPost world was thrown into total chaos.
The details are somewhat complex, but the gist is this: Google assigns a PageRank rating of 0 to 10 for every site it indexes. The ranking reflects the significance of a site as determined by Google -- the higher the rank, the more popular the site. When Google modified its PageRank algorithm a couple of weeks ago, however, thousands of bloggers working for PayPerPost ("posties," as they call themselves) found their rankings wiped to zero, which meant they were suddenly ineligible for PayPerPost work.
PayPerPost isn't taking it quietly, though. Izea, the Orlando, Florida, business formerly known as PayPerPost, has rolled out a new product that it thinks will save its bloggers from the financial ruin wrought by Google.
PayPerPost's business model has been controversial from the start. It recruits bloggers to post promotional content on behalf of advertisers in exchange for a fee. The advertisers are surprisingly legitimate: Sweeney Todd, the new Tim Burton movie starring Johnny Depp, for example, is among the products being touted by PayPerPost right now.
There are roughly 100,000 PayPerPost bloggers, many of whom have seen their revenue completely evaporate since Google modified its PageRank algorithm.
Because advertisers hire posties based on their PageRank scores, bloggers in the PayPerPost universe felt the algorithm change immediately, and some say the entire business has collapsed. One postie, who calls herself Lisa, says she will likely need to find new work soon.
"Unless something changes in the next month, I won't be seeing any more money coming in from blogging," Lisa wrote in an e-mail to Wired News. "My visitor count hasn't dropped because of the PageRank; however, visitors do not equal income."
Contrary to many reports, said Izea founder and CEO Ted Murphy, the PayPerPost market is not melting down.
"We're pretty lucky in that our marketplace hasn't seen any change in the liquidity," Murphy said, "though the people that had their PageRank taken away are upset and vocal about it."
To rectify the situation, Izea rolled out a new rating system, called RealRank, which the company thinks will more accurately reflect participating blogs' traffic and influence, based on a variety of factors.
Since RealRank was launched a couple of weeks ago, Murphy says that 60 percent of PayPerPost advertisers have downloaded a kit that lets them use the system when deciding which bloggers to hire. And no, he doesn't think Google's recent algorithm change spells impending doom for his company.
"I can think of seven or eight times over the past year where people said the sky is falling," Murphy said. "The thing people have to take into account is that our blogger base is growing exponentially."
At least one PayPerPost customer, search-engine-optimization firm Apogee Search, thinks the challenges will likely continue. Part of the problem, according to CEO William Leake, is that many posties provide little more value than linking to an advertiser's site. The number of links going to a site helps boost its PageRank with Google, but doesn't necessarily influence public opinion about a product.
"I think a large part of this change is going to be relatively permanent, and there will be constant challenges," Leake said.
Leake, who estimates that Apogee has paid tens of thousands of dollars to PayPerPost on behalf of Apogee clients, thinks the PayPerPost network needs to be reinvented.
"This is part of the growing-up process of their ecosystem," Leake said. "(PayPerPost) is going to discover a more powerful reason for its existence than just to provide links to sites for search-engine optimization. On the other hand, Google is reminding people that it is a Google world and Google will do what it wants to. It's really no friendlier than Microsoft."