Monthly Archives: July 2009

Microsoft And Yahoo Make A Deal

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Microsoft and Yahoo recently announced a deal on search engine marketing. According to the terms of the deal, Microsoft is essentially acquiring Yahoo’s search business. Yahoo’s search advertisers will use Microsoft’s adCenter platform, and searches performed on Yahoo and its properties will serve up results from Bing.

Timeline
This deal will not affect advertisers or searchers for quite some time. The deal first has to gain regulatory approval, which it might fail to do given the denial last year of Yahoo’s proposed deal with Google. If the deal is approved, the issues surrounding such a massive integration likely mean that the deal will not go live before 2010.

Effect On The Market
According to the latest data from Compete, Google dominates the search market with a 73.9% share, compared with 16.6% for Yahoo and 6.5% for Microsoft. That represents an increase of 9.5 percentage points for Google over the past year, and a corresponding fall for Yahoo and Microsoft. It is very possible that this deal will slow or even reverse that trend. Yahoo gets incredible traffic to its various properties, and Bing’s search results have been competitive with Google’s in my testing so far, aside from a few hiccups in its first week. If consumers on Yahoo’s properties learn that searches done from those properties will match or exceed what they would get from Google, then Microsoft/Yahoo could definitely increase share.

What Does This Mean For Advertisers?
Until this deal is approved and put into place, nothing. If it happens, however, it will affect advertisers in a number of ways. First, advertisers will see Microsoft/Yahoo as a more viable alternative to Google, leading more of them to advertise on Microsoft/Yahoo. This extra demand might push up the cost-per-click currently seen on Yahoo & Bing, but probably not by much. Second, Microsoft’s adCenter offers better fine-tuning of PPC campaigns than Yahoo Panama, so search engine marketing experts will be able to create more effective campaigns than those currently appearing on Yahoo.
The most important effect, however, depends on how Bing evolves. As I noted in my last blog, Bing has effectively reduced available impressions by serving limited numbers of ads to searchers who tend not to click on them. This has reduced traffic for some of our clients, and we know that other SEM companies have seen this trend, too. If Microsoft doesn’t change Bing before the deal goes into effect, this impression reduction would change from an annoyance into a major problem. Path Interactive will continue to consult with Microsoft in order to prevent this from happening.

June Bing Search Share Rises Slightly

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According to Comscore, Bing’s search share rose another .4% at the expense of Yahoo!.  Some of the interest is Bing is just that…interest.  One theory that we are looking into is the thought that a lot of Bing’s search market share usage is compare/contrast searching across search engines.  

 

To validate this theory, we took a look at a small sample of our Paid Search clients’ activity from the first week of July compared to last July and crossed referenced IP addresses on click activity.   There was a marginal imcrease in duplicate IP clicks across search engines (Bing, Google, Yahoo!)  so we are going to take the time to furhter evaluate the results and share what we find out.

 

Below is the June market share according to Comscore:

 

June 2009 U.S. Core Search Rankings

Google Sites led the U.S. core search market in June with 65.0 percent of the searches conducted, followed by Yahoo! Sites (19.6 percent), and Microsoft Sites (8.4 percent). Ask Network captured 3.9 percent of the search market, followed by AOL LLC with 3.1 percent.

 

      comScore Core Search Report
June 2009 vs. May 2009
Total - U.S. - Home/Work/University Locations
Source: comScore qSearch
                                                Share of Searches (%)
                                                --------------------
                                                                    Point
                                                                    Change
                                                                  Jun-09 vs.
    Core Search Entity                      May-09      Jun-09     May-09
                                                                 ----------
    Total Core Search                       100.0%       100.0%       N/A
    -----------------                       -----        -----   ----------
    Google Sites                             65.0%        65.0%       0.0
    ------------                             ----         ----        ---
    Yahoo! Sites                             20.1%        19.6%      -0.5
    ------------                             ----         ----       ----
    Microsoft Sites                           8.0%         8.4%       0.4
    ---------------                           ---          ---        ---
    Ask Network                               3.9%         3.9%       0.0
    -----------                               ---          ---        ---
    AOL LLC                                   3.1%         3.1%       0.0
    -------                                   ---          ---        ---

* Based on the five major search engines including partner searches and cross-channel searches. 

Searches for mapping, local directory, and user-generated video sites that are not on the 

core domain of the five search engines are not included in the core search numbers.

Not Seeing Your Ads On Bing? You’re Not Alone.

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As you probably already know, Microsoft recently launched its newest search engine: Bing. Microsoft’s goal for Bing is to take share away from Google by offering more relevant results to the searcher, especially in the Health, Travel and Local verticals. Microsoft has done a good job in those verticals, and my experience with the engine in all verticals has been generally positive, though I have seen some hiccups (one recent search returned results in Thai and German-not very relevant to a guy in Brooklyn).

Too Focused On The User Experience

Unfortunately, in focusing so much on improving the user experience from Live Search (Microsoft’s old, unmissed search engine), the engineers at Microsoft have hurt the experience of its advertisers. Advertisers across the country, including our own clients, have seen declines in impressions and clicks since Bing’s launch. This is because Bing tracks its users’ behavior. If it notices that a particular user tends to not click on ads, it reduces the number of ads shown to that user. Also, if a particular user conducts numerous searches on the same or similar keywords without clicking on a particular company’s ad, Bing will stop showing that company’s ad for those keywords.

Those aspects of Bing’s advertising system are confirmed and well known. However, I suspect that if you don’t click on a specific company’s ads over a few searches, Bing will stop showing you ads from that company even when you search other keywords in a campaign. Microsoft’s account reps aren’t privy to all of Bing’s secret, so they can’t confirm this, but they think I’m right.

Help Is On The Way

Path Interactive is working to make sure that Microsoft fully understands the difficulty this issue can cause for our clients. Fortunately, Microsoft has heard our suggestions, and is now working on something that will allow us to confirm that an ad is live and active. Google has had such a diagnostic tool for a while now. We like it because it allows us to conduct searches without racking up impressions (thereby hurting quality scores), and we have been encouraging Yahoo and Microsoft to develop equivalent tools. Microsoft promises to finish its version soon. In the meantime, our advice is: STOP SEARCHING FOR YOUR ADS SO MUCH-YOU’RE HURTING YOUR QUALITY SCORES!

James Connell is Search Director at Path Interactive, a NYC-based interactive marketing firm.