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Thoughts on Microsoft’s Live Search Cashback
By David Sumner-Smith | May 22, 2008
Seattle Times technology reporter Benjamin J. Romano has written a good general article about how Microsoft’s new ad model aims to break Google’s grip. He’s written a brief summary of the playing field and included some thoughtful analysis.
I shopped the article around to some of the knowledge leaders here at Marchex. Here are some of their views:
According to one of my colleagues, Google will always be the leader in search. Full stop. And Microsoft should direct their focus elsewhere – maybe looking toward making their software readily available online.
He also pointed out that only a small percentage of product purchases are made online. Consumers often use online searches to find reviews and information about products, store locations, information, etc. But most of the actual transactions are made offline in the brick and mortar stores after they’ve done their “shopping” (research) online.
He referred me to Danny Sullivan’s analysis on Search Engine Land.
I also received an email from a colleague with experience working with Microsoft:
“My main reaction is I kind of get it, but it’s not clear to me that it will revolutionize the way people search. I’m still going to go to Google to do my research - from there I’ll find things like the reviews of the product, forums about the product, and figure out what 1 or 2 models I want to buy (in fact, I’m doing that right now to buy a new grill). Once I’ve decided on the grill, then is it worth a % to me to pop over to MSFT and try it - sure. But I’m still going to compare - MSFT is only dealing with certain retailers, so the question for me is is MSFT Retailer price + shipping - cash back less than Direct Price found on Google + shipping. If so, I’ll buy it.
So if I took a step back - I think it makes perfect sense for retailers to work with MSFT - they pay an acquisition cost and it’s only paid if a purchase is made - that is high value. But I don’t see it being as disruptive to Google as others do. If anything, it’s disruptive to folks like nextag, dealtime, pricegrabber etc - basically MSFT has made it financially interesting to me as a consumer to use their comparison shopping engine, but not necessarily their search…. If this drives traffic, then sure, it makes it more interesting to advertisers to put ads there, but I don’t think it competes with Google, at least not yet.”
Obviously, much ado about who knows still remains to be worked out, and much e-ink will be spilled before we find out if this new strategy will amount to anything.
Topics: Pay-For-Performance, Forecasts, Blogging, Local Search, Advertising, Uncategorized |