Positional Scarcity | Hacker News Reader

Positional Scarcity

alexdanco.com

146 pointsjger1558 comments

> But recently, Google has started to use their power as the effectively sole search provider in a few really extortive ways. First, the Basecamp situation above: by making a design choice to stuff so many ads above organic searches for a company’s own name, businesses like Basecamp are effectively forced to pay up whatever Google wants in order to access search traffic for customers searching for them directly. That’s pretty extortive.

On the flip side, if I were a competitor to Basecamp, I love the access I have by advertising on Google on Basecamp. If Basecamp's business suffers from users going to an alternative, perhaps their product offering isn't as unique or valuable as they would like to think. Also I would point out that people searching Basecamp on Google rather than going to Basecamp.com may look for Basecamp type products. It's like if I search band-aid. Maybe I mean band-aid branded products, but giving me access to similar offerings is great for me as well as competitors

It seems to me that a larger company could use this to crush smaller competitors, keep them from gaining market share by advertising using the smaller business name as a keyword, and constantly outbidding the smaller competitor. Enabling that kind of anti-competitive practice is pretty horrible.

Placement isn't solely based on your bid. My experience has been that branded kw bidding requires only token spending to be the top result for your brand term.

Too bad you're downvoted. I agree. For example, Apple barely needs to advertise, as (until recently at least) its products are a quality class above everyone else, so basically, every non-Apple laptop is an Apple advertisement. I haven't used Basecamp so I'm not so sure about them, but ... maybe they're just not that good?

>Apple barely needs to advertise

Apple has a $2B marketing budget and has advertising everywhere, all the time.

Indeed, absent advertising, how would the previous poster, like so many others, have come to believe the fiction that Apple products have better quality than their competitors'?

What they do have is higher prices. They could, in principle, deliver better quality, but Apple's record-breaking pile of cash demonstrates clearly that they are not spending it to give customers better quality, but rather pocketing it.

So, what are customers getting for their extra money, instead? They are displaying an ability to spend wastefully, a social dominance signal. They feel like they benefit, and Apple actually does benefit.

Everyone who thinks they attracted a more desirable mate via such a display has, instead, attracted a mate who was fooled by such a display. What is the correlation between quality and foolishness? It must surely be negative.

> Every non-Apple laptop is an Apple advertisement.

Really? Does this work for cars? Is every Hyundai Elantra on the road a BMW advertisement? How about watches? Every Timex or Casio is a Rolex advertisement?

Apple's value is it's advertising and brand. It's products are objectively not higher quality. People just say that because they have been told that by other people.

High quality products last a long time. Apple's products are engineered to not last a long time. There's absolutely no reason I should be forced to buy a new macbook pro to run xcode. Either xcode is a low quality product, the macbook is a low quality product -- or both, which is the case. There are vastly superior products to both the macbook pro and xcode.

I've a 2013 MacBook Pro and am in a market for a new laptop. Please suggest a higher quality product. Even just matching this product, is a challenge - keyboard, trackpad, retina display, battery life, operating system (Windows is spyware, Linux hardly works on laptops). Not to mention that e.g. Apple's ecosystem (iCloud, iPhone, MacBooks, ...) are way better integrated than anything else. Privacy advantages (iPhone is literally the only sensible option for a privacy-oriented consumer). I could go on.

Look. I wish any other company would step up and make anything even remotely similar. But they just keep dropping the ball. Closest are probably XPS laptops, but (1) they run inferior OSs, (2) the hardware is probably subtly inferior (e.g. trackpad, battery life, heating & ventilation, plastic chassis (LOL), weight, ...), so for the price I might just buy Apple again (or stay with my old laptop, which, contrary to your comment, still works very well - though admittedly I don't have to use XCode).

I chose a Lenovo Thinkpad with a Xeon processor, which you can't get in a MacBook Pro, which I also have 2 of, and from personal experience having owned and/or extensively used Dell Latitudes and Inspirons, a Toshiba Qosmio, and Surface laptops, my opinion is that the Lenovo is the best laptop available.

Well I mean that's not really a real question, is it? You've specifically phrased it so that only a macbook would be acceptable.

But if you're at all serious, the Xiomi probook is pretty good. It doesn't have a retina display but non-retina displays work better with linux so I actually prefer that for a linux laptop. It also has an nvidia-optimus gpu setup, which is a big improvement.

Everything works out of the box on linux.

Of course if you're married to mac OS you're married to mac OS.

As far as the OS goes, having used MacOS at work for 6 years across 2 separate Pro laptops, ending about a year ago, I'd now rather write code on Windows 98. The terminal was one bright spot until it started crashing repeatedly about a year or two ago (many reports of that online and it was not fixed for months, until I no longer had to use MacOS). I have a looong list of glitches, crashes, hangs and feature rants, but my favorite was the proliferation of "Memory cleaner" apps, one of which I've actually had to use. The way they work is they take up a ton of memory and then release it to force MacOS to actually manage memory properly, so all your other apps don't stutter or crash with allocation failures. And it worked like a charm for me! I've had a free app but apparently people pay for them, too. That's pretty much MacOS in a nutshell as far as my experience goes.

The keyboard on my wife's MacBook Pro is already malfunctioning pretty egregiously after like a year of ownership so even the latest Apple stuff is not a great 2013 MacBook replacement.

Yeah, I agree, but to catch up to 2013 Apple, 2019 Apple only has to fix the keyboard and a few other hardware updates, whereas other manufacturers have a whole new OS to write :)

And then you have all the users who goes to the address bar, type basecamp, hits enter before clicking on the first link in the search result without even looking at the link

“Also I would point out that people searching Basecamp on Google rather than going to Basecamp.com may look for Basecamp type products”

From what I have seen most people don’t even know the difference. They type in “basecamp” and Click the first link.

How many people have you personally observed searching for Basecamp? I mean, it can't be that many, right? Or, do you mean, most people you've watched use Google just click the top link for whatever they're searching for? But even then, how often do you look over people's shoulders when they're searching?

Maybe I'm weird but, like, I don't have any idea how my friends or colleagues use Google, and I work in the industry. So I'm really curious via what mechanism you were able to gather enough samples that you feel you can make a strong statement on this one way or another. Are you in SEO? A UX researcher? Do you have a business interest in the way people use Google, somehow?

I work in ML for search engines and have been part of very large cohort (n > 5000) user studies carried out by a former employer to measure eye saccade movements over search result pages to understand where user attention is drawn in different search modalities.

In list form results, users typically just click whatever is the first thing without much consideration for its relevance.

In gallery form results, users will scan in a ”backwards C” shape along the first row, down the far right column, then from right to left along the bottom row above the fold, pretty consistently, but still usually just click things in the first row.

The cohort was meticulously designed to allow controlling for factors like age, search interface familiarity (users completed tasks in sessions prior to the eye measurement portion), country, language, etc.

There is a much older, smaller - but public - study done by MSR a long while ago as well: https://www.microsoft.com/en-us/research/publication/what-ar...

Interesting! It might go without saying, but just to check: I assume the study intentionally included some cases where the first result was not the most relevant one, right? Did the study find differences in the rate of clicking on the first result when the first result was irrelevant?

Yeah, the study included tons of variation in result relevance because a big goal was to develop actual relevance information for understanding NDCG as an evaluation metric.

One of our conclusions was basically that you can’t use relevance measurements as a function of rank position virtually at all unless you can identify when a user is a member of the very tiny subset that actually hunts through results for relevant ones. In some cases this is tipped off by highly specific queries.

But in the general case of highly generic or popular queries for the vast majority of users, they will click the first thing more or less regardless of relevance. It’s more like a reflex at that point than a decision.

In a very real sense, Google ad placement at the top of list-view search results is a tactic to monetize totally unconscious reflexes. I think in the future it will be considered in the class of behavior as marketing cigarettes to teenagers or something. It’s not a conscious value proposition, but exploitation of cognitive flaws.

There's a great answer here on search engine studies but I want to point out the position the parent comment is making: most people don't know the difference between using a search engine like Google and using the WWW itself. Domain names, URLs, protocols, search engines, links, paid placement, they're all just annoying babble between you and the cat pictures you're looking for. Fortunately, you can learn the clicks and the typing you need after a few tries and then it's just muscle memory to repeat at will; you never have to figure all that stuff out.

If you work in "the industry" you owe it to yourself to watch "real users" for a while. Sure we're talking about anecdotes here but you should have your own.

> Also I would point out that people searching Basecamp on Google rather than going to Basecamp.com may look for Basecamp type products.

It does not make much sense from pure search engine quality perspective, top hit for a navigational query should be the main url, it also better redirect right away from browser addressbar context (“I’m feeling lucky” like) Alternatives are fine if the query contains the word “alternative” or other intent markers

As a counterpoint (also discussed in other threads below), often few other people want to bid on those keywords, so it's not as expensive. It's still a crappy thing to do.

This is simply a virtual form of real estate business.

As real estate brokers say, the price depends mostly on 3 things: location, location and location. If you are on Manhattan you pay more for that land than far away in Brooklyn. Similarly with the Domain Name System - shorter domain like www.abc.com is more desirable than www.hdhfjenyrj.goobledygook. There is no scarcity of string combinations for domain names yet people fight for desirable ones by paying a lot of money. It's a form of congestion pricing around naturally formed monopoly in desirable locations or domains.

These big tech platforms create their own land online - virtual estate. Limited human attention creates the scarcity of valuable locations where advertisers would like to show their ads. So they compete for being shown on Manhattan of the web - Google's top of the search results and Facebook's feed. The platforms can charge them huge monopoly, real estate like, prices for it.

Where that analogy falls short is that if a given company pays for cheap and/or inferior real estate, you will still find that company if you explicitly go to their physical location – you don't have to walk past four competitors who paid extra for the right to stand in their driveway.

How is Google's website analogous to someone's driveway?

"Explicitly going to their location" is typing their website into the address bar, and as far as I know, there is no interference by Google there.

This just isn't how a majority of people find sites, though. To your normal users, google may as well be the address bar. Hell, I've watched users go to google, type facebook.com (or wherever they're going) into google, and then click on the first ad link.

So, you have this situation where typing basecamp.com into google may not bring basecamp as the first result and the people buying the ads know that.

Hence snidane's comment about location location location is accurate.

Google owns a coveted location, and now they can charge rent for it. Apple owns a coveted location, and charges Google rent for it.

But it could not be simpler or easier to bypass Google.

> But it could not be simpler or easier to bypass Google.

My point was that your run-of-the-mill user doesn't do this. It is easy to bypass, but how many people actually do it? You're just saying to me that people should become power users or just accept that they're victims of manipulative advertising.

Anyway, the rent they're charging is other products masquerading under Bootcamp's popular name. They're essentially charging Bootcamp rent so that "fraudsters" can't eat up the top positions in search results for your product. Grocery stores don't let a Cheerios knock-off named Cheerio-os sit on the end-caps because they paid more than Cheerios. If I go to my grocery store and ask for Cheerios, they'll take me to it - not Cheerio-os because they paid more for me to find them.

It sounds like a racket to me. You can pay google to keep your company at the top of the search results, or they can break your kneecaps by making you hard to find.

And why is rent-seeking behavior something that we want in a search engine we are supposed use to find relevant information?

Voice control is becoming the de facto interface on phones, cars, and home connected devices. That puts Google or Apple directly between you and what you want with no equivalent alternative.

And yet if you ask Assistant to search for and open a webpage, it'll pick the first search result while ignoring the ads.

Of course it would -- it's basically "I'm feeling lucky" in a different format, which never did care about ads.

> But it could not be simpler or easier to bypass Google.

Really? Unless you pay Apple considerably more, you will have a google search bar prominently on your phone that you can gimp but cant hide or change to another search provider.

I have been racking my brain for several minutes now trying to figure out what you’re taking about. I never paid Apple anything to switch my Safari search bar to DuckDuckGo, and I can’t imagine 3rd party browsers are restricted from using a plain address bar or any search provider they want

I meant 80% of the market runs Android primarily on hardware price..

If you are using a newer Android, the manufacturer has been coerced to make a google search bar not only prominent but impossible to hide, even manually by the user.

Ah, that makes sense. I was afraid maybe you were referring to something horrible coming in iOS 13

I was thinking about on a desktop, but even on mobile, tapping the browser icon and then tapping the address bar is not a burden from my perspective. Perhaps google is abusing their position as makers of Android, but it’s tough to see a argument to not let them put their own search bar on their own software.

A profit model based on the defaults is certainly pretty reasonable, and eforcing that on manufacturers is perhaps logical, but if a company is afraid of letting the user change the defaults to use different combinations of products that they prefer then you are basically the reason for antitrust legislation. (Either the products require this coercion, few people would switch or you are using a product in one area to prevent new competition in another.)

The same could be said for physical shopping, though. The majority of people are not going to drive out into the countryside or the warehouse district to find your particular clothing store. They're going to walk to the fifth avenue shopping district or Herald Square. And, indeed, your competitors are all there, even if the user intended to go directly to your store. You can easily observe the same phenomenon in the clustering of car dealerships.

I mean the fundamental observation, I feel, is that you don't have a right to be free from competition just because the user has heard your name. To believe otherwise is anti-user and anti-consumer. It is good that Basecamp's competitors can advertise to its potential users, because that increases the level of competition and information in the marketplace.

That was true a couple of decades ago. Notice that there aren't address bars on most browsers people use nowadays, and the change happened pretty much due to Google's interference.

I don’t know what your definition of address bar is, but all 4 of the big browsers have a space at the top where you can enter a full website address and be taken directly to the website.

Which is exactly why some companies have an explicit strategy of placing their locations on the same location as their competitors. IIRC, this happens often in the franchising industry, where a stronger competitor (e.g., McDonald's) will work to position new stores on the same location/intersection as a weaker one (e.g., Wendy's or Burger King). The new location might not be as profitable as their normal criteria, but it will weaken their competitors' profits.

Replace monopoly google with monopoly clear channel and you have exactly that problem.

Your landlord might be renting the wall next to your driveway to Clear Channel or the neighbor might own it and rent it to them. But if it can fit a billboard and be seen from the street it will have one in metro areas where that isn't illegal.

(Additionally) they* have been known to be geo-targeted on particular firms/individuals to mislead, i.e. make the purchaser believe they got better coverage. Probably the most famous example is hiding them from a target instead:

https://www.pajiba.com/celebrities_are_better_than_you/the-l...

[*] To be clearer, they == "poster campaigns", I have no idea about specific roles to say they = "Clear Channel" in examples of targeted/misleading campaigns.

Like with everything: Don't play their games, play your own.

I got a short and cheap domain name because I didn't buy a .com or .io domain.

But yes, especially with real estate it's often hard to say "Oh SF is expensive? Guess I'll work remote and buy a house in the countryside"

Registrars still charge exorbitant prices for short domain names outside of com and io.

I pay like 29€ per year, is that exorbitant?

Every short domain I looked at, the registrar considered them "premium" and wanted $300 or up to $3,000 per year for them, even on obscure tlds.

I like your explanation better. The general concept is hidden in the original essay. How did you figure out the generalization?

This sounds like a bit of a shakedown, and I'm not in marketing, but can someone confirm what I heard at last my last company - is it true that should at least pay less than anyone to advertise against "Basecamp", because they're deemed most relevant?

Yes, this is true. The price you pay per click is based on a ton of factors loosely proxying to "customer satisfaction". F.ex. Do alot of users bounce? Does it have a high CTR?

Considering the intent of users searching for "basecamp" they are pretty much guaranteed to get the best "customer satisfaction" metrics compared to competitors and therefor getting the best price.

My experience with branded searches is the CPC being somewhere around 1-10% the price of non-branded searches.

Yes.

The position in ads is determined by your bid times your google computed quality score.

Brand terms tend to have higher quality score than competitors.

This is probably a phenomenon of user tolerance which is game all companies try to balance with making money and delivering value to stakeholders and customers. This only really became a problem when it went from 1-2 ads at the top, to 3, and now 4 above the first organic results.

Considering on mobile you’d have to scroll quite a bit to get to the first non ad one could argue Google as a service as a whole is worse off for consumers, not to mention for the whole internet which benefits from accurate rankings.

I’m curious if people would be so outraged if it went back to 1-3 on average. Or whether this would improve the UX as a whole. But Google lately has given way less of a shit about putting the UX above monetization strategies. Which is as much as consequence of their market position where there’s no alternative.

Have you tried searching for Facebook in the App Store? The first result is...Amazon.

I get Google Maps. For a while if you typed "alexa app" you got an scam that tried to sell you a "echo subscription". I stumbled into it when an elderly man with poor vision got fooled because his screen magnification was so high the paid ad was the only thing shown on the screen when he searched. He would've had to scroll down to see the actual search results. Looks like Apple finally nerfed the imposter but now shows the Prime Video app before Alexa.

I knew the concept but didn't knew the name of it it's positional scarcity

So it's basically, like they say in the article "“pay to get a better place in line”"

It's the most common behaviour in the marketing world and that's why I hate PPC and love SEO

in PPC the more you pay, the more you will appear high in the ads when someone is look for search term related to your niche

In SEO, you need to earn your place. Ofcourse companies often use a spend a lot of money on SEO but because the way google built their algorithm, if you write high quality content in the right way you can earn your place without paying a dime

in my opinion it is scarcity all the same: attention scarcity.

There is a psychological component here that is very similar to the arms race mentality.

An object in motion stays in motion with the same speed and in the same direction unless acted upon by an unbalanced force.

It may be an undetermined distance away, but there will be a behavior bubble until the way we engage (in a linear format) will be disrupted. Then there will be another 'scatter', and we will re-form into different version of engagement (web 3.0?).

At least they're decently well indicated as ads. Go to bing.com and search for some tech company. It does the same, but the ads are subtly labeled, making them seem like natural search results.

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