Google got more and more popular. It won the support and admiration of Danny Sullivan, editor of an influential newsletter focused on Internet search. It had built for itself a very loyal user base that gave feedback on even the slightest of modifications to the site. However, it had yet to come up with a way of making money.
At that time, a company called Overture caught Brin's attention. Overture was the company that provided the search results that accompanied searches of Yahoo and AOL, among others. The Google guys liked the idea of havingturkana human gameon search, rather than flashy and distracting banner ads. However, there was one practice of Overture's that they did not approve of - Overture guaranteed that if a company paid a certain amount of money, it would find a place among the advertisements. It went directly against their motto of 'Don't be evil'.
They decided, therefore, to go it alone. They developed an algorithm for search-based advertising on their own. True to their motto, they ensured that there was a clear demarcation between the actual search results and the advertisements. Like the search results, the advertisements, too, would be ranked. The ranking of the advertisements would be based not only on the amount of money paid, but also on the number of times it is clicked. Hence, popular ads would appear more prominently.
Prices for Google's ads were fixed through a nonstop auctioning process. Auctions were done for every search phrase. A phrase like 'investment advice' would cost a lot more than a phrase like 'pet food'. Companies started having dedicated employees to carry out Google auctions. There were several subtleties involved. For instance, 'digital cameras' would be auctioned for a higher rate than 'digital camera', because a user googling 'digital cameras' is more likely to buy one.
Google advertising policy was not without its share of problems. Once, an insurance company named Geico filed a lawsuit against Google, on the grounds that it had allowed other companies to bid for its name. A user searching for 'Geico' would see in his results all insurance companies that had made a winning bid for it. Geico claimed that Google did not have a right to let Geico's competition take advantage of searches on its name. Google's defense was that Geico's understanding of consumer behavior on the Internet was incorrect. A user googling 'Geico' is not necessarily looking only at Geico's website. Besides, Google was not the publisher of the ads, and it also had systems in place to protect trademarks. It did not allow ads to contain trademarks in their heading or text. Google ended up winning the case.