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With every Web search, the future comes into focus

By DAVID LEONHARDT
Published July 13, 2006

A few years back, a technology writer named John Battelle began talking about how the Internet had made it possible to predict the future. When people went to the home page of Google or Yahoo and entered a few words into a search engine, what they were really doing, he realized, was announcing their intentions.

They typed in "Alaskan cruise" because they were thinking about taking one or "baby names" because they were planning on needing one. If somebody were to add up all this information, it would produce a pretty good notion of where the world was headed, of what was about to get hot and what was going out of style.

Battelle, a founder of Wired magazine and the Industry Standard, wasn't the first person to figure this out. But he did find a way to describe the digital crystal ball better than anyone else had. He called it "the database of intentions."

A few weeks ago, Google took a big step toward letting people dig into this data themselves by creating a product called Google Trends. It allows you to check the relative popularity of any search term, to look at how it has changed over the past couple of years and to see the cities where the term is most popular. And it's totally addictive.

You can see, for example, that the volume of Google searches would have done an excellent job predicting this year's American Idol, with Taylor Hicks (the champion) being searched more often than Katharine McPhee (second place), who in turn was searched more often than Elliot Yamin (third place). On Battelle's blog, somebody claiming to own an apparel store posted a message saying that it was stocking less Von Dutch clothing and more Ed Hardy because of recent search trends.

It's this last point that turns the database of intentions from a curiosity into a real economic phenomenon. Google Trends is a blunt tool. It shows only graphs, not actual numbers, and its data is always about a month behind. The company will never fully pull back the curtain, I'm sure, because the data is a valuable competitive tool that helps Google decide which online ads should appear at the top of your computer screen, among other things.

But Google plans to keep adding to Trends, and other companies will probably come up with versions, too.

When these tools get good enough, you can see how the business of marketing may start to change. As soon as a company begins an advertising campaign, it will be able to get feedback from an enormous online focus group and then tweak its message accordingly.

Hal Varian, an economist at the University of California in Berkeley who advises Google, predicts that online metrics like this one have put Madison Avenue on the verge of a quantitative revolution, similar to the one Wall Street went through in the 1970s when it began parsing market data much more finely. "People have hunches, people have prejudices, people have ideas," Varian said. "Once you have data, you can test them out and make informed decisions going forward."

[Last modified July 13, 2006, 06:51:40]