Hal Varian & The Google Auction
Hal Varian, Google’s Chief Economist, explaing Google’s AdWords auction, based on William Vickrey’s second price auction thesis published in 1961.
What seems like an obvious innovation (bid x quality score = ad rank) helped Google knock the snot out of Overture (and Yahoo following their acquisition of Overture for $1.6B in 2004).
The tweak allowed Google to go from zero to $5B in revenue a year in just four years. Amaaazing.
~ Zorilla City