Sunday, October 12, 2014

Why is QuiBids Showing Competitor Advertisements?

Why is QuiBids advertising competitors? It's a weird business decision really. That too, using the plain old Google Adsense program, so the site has absolutely no control over what advertising is being shown. This means, if someone is searching for penny auctions in their Google history, they might be shown an advertisement of QuiBids itself. Or worse, a competitor.

As a general rule, if you're not an information-only website (e.g. this blog), it's a bad idea to have Google Adsense ads on the website. It's worse if you're in the e-commerce space, since you're most likely to see competitor ads on the site. When I tried it out, for instance, here's an ad that I saw on the QuiBids page:


The site being advertised is BuyDig.com, which is an e-commerce site (not a penny auction). However, Google is well known to track clicks and shows relevant advertising. It wouldn't be hard to imagine that other people might actually be seeing competitor advertising on this space. It's even harder to understand when you consider the fact that this is a prime advertising location, above the fold.

Here are some competitors using Google Adsense text ads (and possibly the banner ads too):




Normally, if companies want to advertise on their homepage and every other page, they might like to use a non-competing advertiser, instead going through marketplaces like BuySellAds which give more freedom in choosing what advertisement will be shown. Going with Google Adsense is a bit naive, in my opinion, because it opens up the possibility to show ads for direct competition.

It might also mean that QuiBids is not doing as well as we think, and needs the extra revenue, even if it means a direct reduction in its overall sales and customer retention (as some customers would go off to competing websites). Otherwise, it might be that QuiBids gets so much traffic, that it feels like this would add a significant source of revenue for the website.

What are your theories for this behavior?