Starting From Search

Yahoo Calls BS!

Anyone following the "Will Microsoft ask Yahoo to get married" drama are already familiar with Carl Icahn, who started a school yard proxy fight over the future of Yahoo.

Today, Yahoo posted an open letter to Carl Icahn:

Yahoo!'s Board of Directors continues to stand ready to enter into negotiations with Microsoft Corporation for an acquisition of Yahoo!. Indeed, as recently as June, Yahoo!'s independent directors and management approached Steve Ballmer about just such a transaction, only to be told that Microsoft was no longer interested even in the price range which they had previously proposed. Now Mr. Ballmer and Mr. Icahn have teamed up in an apparent effort to force Yahoo! into selling to Microsoft its Search business at a price to be determined in a future "negotiation" between Mr. Icahn's directors and Microsoft's management. We feel very strongly that this would not lead to an outcome that would be in the best interests of Yahoo!'s stockholders. If Microsoft and Mr. Ballmer really want to purchase Yahoo!, we again invite them to make a proposal immediately. And if Mr. Icahn has an actual plan for Yahoo! beyond hoping that Microsoft might actually consummate a deal which they have repeatedly walked away from, we would be very interested in hearing it.

I believe that is Yahoo telling Mr. Icahn where he can stick it. While this type of bickering usually weakens a company in the long run, I think it's actually good for Yahoo. The big Y has been stagnant for too long, and this may be what finally gets the passion back for them.

Microsoft Makes $45 Billion Bid for Yahoo

Microsoft has made an "unsolicited" $45 billion bid for Yahoo! in a cash and stock swap. This was a deal a long time coming and frankly, isn't a surprise for anyone in the industry. Microsoft and Yahoo have been seen flirting at the dance before.

Why now? Both are concerned with Google's ever increasing dominance in the search space. This purchase would be a merging of armies to take on Google. And considering Yahoo's inability to gain traction after their executive reorg last year, its perfect timing on Microsoft's part.

Here's the thing: If Yahoo wants to sell, this is the best deal they will ever get. Other than Google, Microsoft is the only other company rich enough to buy Yahoo. Google would never buy them and Microsoft would never offer a true merger among equals. Yahoo-Soft? Micro-hoo? No way.

But, should they do it?

In order to beat an opponent like Google, you have to be ready to fight like hell. Yahoo stopped fighting 3 years ago. Microsoft, on the other hand, loves a good fight.

This bid might have been unsolicitied, but Yahoo has already considered this option. It's already been throughly discusssed on how to approach a bid by Microsoft. In fact, it says so in their press release:

SUNNYVALE, Calif., Feb 01, 2008 (BUSINESS WIRE) --Yahoo! Inc. (Nasdaq:YHOO), a leading global Internet company, today said that it has received an unsolicited proposal from Microsoft to acquire the Company. The Company said that its Board of Directors will evaluate this proposal carefully and promptly in the context of Yahoo!'s strategic plans and pursue the best course of action to maximize long-term value for shareholders.

The last sentence says it all. Get ready for a sale.

What Search Engines Can Tell Us about Us

I wanted to get back in touch with a friend that I haven't seen in about 3 years. In college we were close, but lost touch when life got busy. We both got married, had kids, etc. So I decided to Google him, hoping to turn up his phone number via a phone book entry.

The very first result told me that he was caught and convicted of a significant crime.

With just a few searches on Google and Yahoo, I learned that he was arrested about 18-months ago. I learned exactly which law he broke, how much time he served, where he served it. Obviously, I was concerned about his family. With a few more searches I was able to learn that he and his wife recently purchased a home in a suburb, indicating they must still be together.

With a few searches I was taken right into the darkest part of his life.

Search is clearly more than just a bridge between keywords and web sites. It is having a cultural impact. How large that impact will be won’t be known for many years. They are becoming an alethiometer of sorts, begging the question: are we really ready to have the answer to every question we seek?

Google is now indexing public government records. In the near future it’s possible someone could do a search on you, and uncover, for example, your divorce records. Is that the first thing you would want someone to know about you?

By the way, I did get his new address and phone number. I'm not sure if I should contact him or not. Google told me his story. I’m wrestling with the question: do I let him tell me his story, or is Google's version enough? Search engines may well now be able provide us information at a rate well beyond our human conditions ability to deal with.

iGoogle

iGoogle is simply a way to make Google.com a portal site. Sound familiar? It should. It also goes by another name: Yahoo.

I called this back in February 2006, when I said Google is trying to be more like Yahoo. This is also evident in Google's recent acquisitions that are turning Google into a larger media company—something Yahoo has already been for years.

Microsoft and Yahoo’s Great PR Stunt

So, Microsoft wants to buy Yahoo. Or, should I say, Microsoft wants you to think they might buy Yahoo. Yahoo wants you to think that, too.

I predict there won’t be a purchase or a merger, but what there will be is a lot of press speculation. And a lot of meetings at Google over this speculation as well.

Google has been the beneficiary of mountains of press and blogging chatter over the last three weeks, mainly from the purchase of DoubleClick. How to fight this free PR buzz?

Create free buzz of your own. And that’s what this story is—all buzz.

Not even Microsoft is rich enough to drop $50B on Yahoo. It would require a true merger of the two companies, and I can’t see Gates and Ballmer agreeing to that. That's why the talks of a merger between these two titans went nowhere two years ago.

Yahoo and Microsoft have had a cordial relationship for years. I expect after a few weeks of media buzz, Yahoo and Microsoft will announce some partnership on some minor product, but that is about it. Similar to October 2005, when they announced interoperability between their IM clients.

This is a smart ploy by Microsoft and Yahoo to get everyone talking about them again. Don’t look forward to seeing a YahooSoft. Or a MicroHoo. Or, whatever you want to call it.

Yahoo, Where Did Search Go?

"Yahoo!, based in Sunnyvale, Calif., also reorganized its 11,000 employees in December from many overlapping subgroups into three distinct business units: Web communities, advertisers and infrastructure." -- TIME, How Yahoo Aims to Reboot

Yahoo, I have a question: Where did search go?

The only way to compete with Google for search market share is to make search a core value and discipline of the company's business. Google excels at search because it has been a core value of the company since it started. And since 99% of Google's revenue comes from their search offering, it will be a core business value for a long time.

Any search engine in the game can only beat Google if they are as passionate about the search offering as Google is. (Are you listening ChaCha?)

A company that gets into the search game because of the profits in the industry will never be a Google-killer. (Are you listening Microsoft?)

Happy Birthday Yahoo!

March 2, 1995, Yahoo! was born. A quick history provided by Wired.

Yahoo Introduces Quality Score in Ad Ranking Starting February 5

Beginning on February 5, Yahoo will be changing the way they rank pay-per-click ads. The rankings currently us bid price as the ranking method, meaning the higher the bid price, the higher the ranking of a pay-per-click ad. This coming change will include bid price and a quality score to determine relative rank, similar to what is already in place with Google AdWords.

What is a Quality Score?
A quality score applied to pay-per-click ads means that bid price is not the sole ranking method. This means that an ad with a lower bid price could rank above a higher bidding advertiser. While the exact factors involved in the quality score have not been divulged by the engines themselves, one influence is historical performance and performance relative to other ads displayed at the same time. Simply, if more people click on an ad, it can be assumed by democratic process that the ad is more helpful to searchers and could get preferred rating.

The quality score was devised to try to keep the playing field even. In a pay-per-click process based solely on bid price, nothing can stop a large advertiser with big pockets from taking top spots. In theory, with a quality score feature that effect is minimized as a small advertiser could compete with Wal-Mart by strategically picking keywords and writing well-focused copy for customers. In other words, better quality ads help with better placement.

This process has been used by Google AdWords for some time now, and it does make pay-per-click campaigns a bit more of an art form than a simple function of calculating a bid price. If your SEM vendor can't tell you why your ad is not increasing in position despite bid increases, the quality score is the reason. (Interestingly enough, the quality score feature can also reveal which PPC vendors are truly savvy marketers versus those that practice "simple" SEM.)

Between now and February 5th, it would be a good idea to scrutinize your PPC ad copy. Also be prepared for some wild position fluctuations that week as well.

Yahoo Blew It

As explained by Wired in this article: How Yahoo Blew It.

It's a great read and in the end shows why Yahoo CEO Terry Semel needs to be shown the door before it's to late. Semel didn't even use email before working at Yahoo. Is a guy that doesn't use email the best choice to fight Google?

Yahoo - AOL Merger in the Works?

MediaPost is reporting on some Merrill Lynch analysis that one or both companies may seek "transformative transactions" in order to stay competitive. One potential option is an AOL-Yahoo merger, which to me, sounds more logical than Microsoft buying Yahoo.

Does this make sense? On one level, yes, as both companies have become stagnant against "the Google." The only engine that is making ground is Ask, which is outpacing currently outpacing everyone. Yahoo should have purchased Ask.com two years ago, but it's too late for that now, as Barry Diller would never let go of his new favorite child.

But an AOL-Yahoo merger? It doesn't make sense. Neither company can offer the other anything interesting. What Yahoo really needs is a new CEO, but it looks like they missed their chance at that, too.

Yahoo and Vodaphone Launch Mobile Advertising

One day after Google's CEO Eric Schmidt suggested an ad supported phone could allow for free cell service, Yahoo and Vodaphone announce they are heading that direction.

Vodafone and Yahoo! to launch advertising on mobile devices

Under the plans, customers who agree to accept carefully targeted display advertisements can expect to enjoy savings on certain Vodafone services.

Why MSN AdCenter will Fail

MSN launched AdCenter this year to close the gap with Google and Yahoo. In terms of market share, MSN sits precariously in third place trying to convince everyone they are a worthy contender.

Third place is not a position Microsoft likes to be in. Nearly every industry has a "fight-like-mad" Microsoft story. Will search marketing experience the same?

Not a chance.

AdCenter has some really nice features as part of the tool and it is easy to use. But the reason why they will not gain traction here is simple – lousy customer service. I have experienced long response times, inability to answer questions, and a basic unwillingness to engage.

Google and Yahoo reps are quick to respond, very helpful and seem to be genuinely interested in helping to set up a pay-per-click campaign that will be successful. They make it clear they are willing to help. Microsoft, on the other hand, acts like, well, Microsoft. No one wants to deal with their hubris, especially in an industry where they are third at best.

Sometimes big companies fail to realize that it is still basic customer service that can undo sales. I work with Fortune 1000 clients. I can imagine what it is like for small advertisers.

While PPC campaigns need to always be about the client’s business objectives, what do you think people like me will suggest to our clients when they ask for a recommendation? I know that I can provide great market reach and customer results with a Google/Yahoo combo. Why is Microsoft failing to help advertisers see the value in their product by treating them like they don't care?

Yahoo Product Focused or Just Looking for Speed?

I was intrigued by a patent that was awarded to Yahoo this week. The patent mentions auction sites in regards to search engine results and relevance.

From paragraph eight: “Matching outdated, e.g, eBay listings pages to search queries can erode search user trust. The relevance problem that occurs when a query matches the title of an expired listing contributes to this.”

Patents are often written a vague as possible to hide the true intention of the idea/technology they are trying to patent. This patent seems to revolve around auction listings, referencing them no less than 10 times and specifically referencing eBay twice. It would make one wonder why Yahoo is focused on auctions. Are they concerned with delivering more product related returns?

Nope.

Obviously search result that goes to an outdated eBay auction would erode confidence. Not in that a user would care so much that the auction is over, but in that the search results were not fresh.

And that is what this patent is about – freshness. Auction sites provide a good example of the problem they are trying to solve yet is oblique enough to the true objective – indexing more sites much faster to provide very fresh results.

Why mask this? Online forums have seen their share of webmasters complaining about the amount of bandwidth search engines spiders consume – which is a problem since most hosting companies charge on bandwidth consumption. Jakob Nielsen covered this topic in the past.

Yahoo doesn’t want to bite the hands that feed them (webmasters) while trying to serve the freshest food (sites) to their consumers (searchers). I applaud this on many levels. As a search marketer, I want my client’s sites to be indexed as often as possible, and as an active searcher I want results that are up-to-the-minute fresh.

Yahoo is trying to find ways to push the gas pedal down while trying to respect bandwidth.

From paragraph 22: “This enables the search system to use update cycles which are best suited for particular types of content or listings, as well as reduce the number of queries required to maintain fresh and relevant content.”

In other words, update your site often and Yahoo is more likely to index more often. Yet they are clearly working on a system to reduce potential server load.

Technorati Tags: yahoo, patents, search results

The Big Four Not so Big?

Slate.com has a good read today: The Not-So-Fantastic Four: Why Yahoo!, eBay, Amazon, and AOL are Tanking.

The main issue of the article seems to be about the inability for four companies to diversify. I think there is more to it than that. After all, when it comes to failed attempts to diversify, Google has its share of challenges. Yet their stock price is sky high.

I think, simply, all the "new media" companies of the 90s (such as the big four listed in Slate), now have the same look & feel as all the "old media" companies we have known forever. We are no longer smitten with things that are "cool," but want things that are useful.

Top 4 Sites in Global Traffic are Search Engines

From time to time, I pop over to Alexa's Global Top 500 out of curiousity. I'm not the least bit suprised to see the top 4 are search engines—Yahoo, MSN, Google and Baidu, a Chinese search property.

(The 5th spot is held by QQ.com, an instant message service in China. If my memory serves me correctly, the search feature there is run by Baidu. So one could argue that the top five are all search properties.)

The top spots have changed slightly from when I last posted about this 3 months ago. Not to sound like a broken record, but I will repeat the point I made then: A few years ago, companies (and individuals) wanted to list their products on Amazon and eBay because that is where the eyeballs of the world were. Where should you list your products today?

Technorati Tags: alexa, china, baidu, qq

Yahoo!, Microsoft Acting like Friends

I try to stay focused on search-related topics. Which is why I rarely cover other products released by search engine companies (notice my lack of entries on Yahoo! Answers, or the rumors of Google entering the Radio Ad market, for example) unless I think it will have a specific impact on their search offering.

I'm intrigued by the news that Yahoo and Microsoft are going to make their respective instant messaging clients interoperable. This is not typical Microsoft behavior. They usually demands other companies, and even customers, bend to their own standards.

This is going to re-ignite rumors of a Yahoo-Microsoft merger, which could be Microsoft buying Yahoo outright, buying a partial stake or a true merger, depending on who/what/where you read. The two companies have reportly been discussing various options for more than a year.

Microsoft has announced their intention to spend upwards of $2 Billion in 2007 to catch Google. Could this new business colaboration with Yahoo be part of a larger goal?

This all reminds me of the Arab proverb: The enemy of my enemy is my friend.

Yahoo Launches Video Offering

Coming to market with a video offering well after Google and YouTube, Yahoo today announced their video offering. It’s available at video.yahoo.com.

The Yahoo press release calls the offering "comprehensive," but it was a poorly chosen word. Anyone coming to the niche late can be forgiven if they offer something better than previous contenders. But Yahoo fails to deliver much of the functionality that we have come to expect from video providers thus far.

Yahoo does not stream the video in-page via shockwave in the convenient manner of Google and YouTube, but rather launches Windows Media Player as an external application.

Also, Yahoo does not have an embed feature, missing the opportunity to help videos become truly viral with easy streaming in blogs. This is a major oversight for a company that is attempting to leverage community as much as possible, such as with recent releases such as Yahoo! Answers.

I would expect these features to be added soon, but their effort seems… cobbled together. It’s hard to view and judge Yahoo’s entry into video by anything else other than what features are missing.

Technorati Tags: yahoo, video, youtube

Yahoo's New Groove

I'm sitting in a hotel room after driving 22-hours to Boulder, Colorado with my family -- wife, two sons, and a few in-laws to boot. The term "vacation" takes on different connotations after a drive like that.

When I got a chance to satisfy on online fix, I noticed Yahoo's beta home page design. Still in beta, but it's bring a new level of personalization to home page. It's a step beyond a dry portal.

Yahoo is bringing a new level of usability to their product offerings. In the rush to discuss anything Google, people are overlooking this. The Yahoo Mail Beta makes Gmail seem clunky at best. Google has tried (and not yet succeeded) in unifying all their account features. Yahoo's new home page beta, and the coming redesign of the search marketing tools will, I predict, push Yahoo far beyond Google.

You may have to be logged into a Yahoo account to see all the features, but give it a look: Yahoo Home Page Beta

Yahoo! to Release Redesigned Advertising Interface in Q3

This morning Yahoo! announced that it will release the much anticipated redesign of their advertising console in Q3 of this year.

The changes will include a more intuitive control panel, with a user-tested navigation. It is also aimed at helping advertisers to easily understand campaign results.

Also expected is better targeting for local search, so pay-per-click ads can be focused on more specific areas.

Ads will be activated in 30 minutes or less, instead of the occasional 3-day long wait that some advertisers currently experience.

There will be better forecasting to help advertisers get a better idea of what their campaigns may really cost. This is a welcome change since I have seen estimates prove to be highly inaccurate. Yahoo did not say how they will make it more accurate, but I will be eager to see how this works in practice.

Goal-based campaign optimization will also be added as a feature. Click price can be automatically adjusted based on cost-per-acquisition.

Yahoo will also be implementing what they call the Visible Quality Index. With this, ads will be scored based on quality, bid price and other variables. This score will be visible to advertisers, and will eventually determine how pay-per-click ads are ranked. Advertisers will not be able to buy the top spot solely on bid price anymore.

All these changes are welcome additions to Yahoo’s search marketing tools. After seeing another Yahoo product -- the email beta -- they appear to have really figured out how to provide powerful, yet simple tools.

Would You Pay to Skip Ads?

I have been running Gmail and Yahoo Mail side-by-side for the last month. I have found them both to be great email solutions, each offering great benefits. I’m curious to see who steals the more innovative features from the other first.

Both services advertise as part of the offering, but Yahoo lets you buy your way out of seeing ads. For $20 a year, you get several enhanced mail features plus a completely ad-free environment.

I started to wonder if users would be willing to buy themselves out of ad networks in other areas – mainly on search.

Both companies make an enormous amount of money serving pay-per-click ads as part of their search results. But would users be willing to pay to not see them?

A majority of users click on an organic link, not a paid one. But the paid links are clearly useful to many people, based on the growing profits of Google and Yahoo.

Maybe the question can be taken to a larger realm. Advertisements are finding their way into nearly every channel – including video games.

Would you be willing to pay to not see them?

Yahoo! Launches Earth Day Microsite

Global warming is a growing concern of scientists and environmental experts. The problem itself seems larger than any one person, and seems out of any individual’s ability to participate in the solution.

With that in mind, Yahoo! has created a comprehensive microsite that helps educate people on how they can take simple steps to slow climate change. Environmental experts warn that greenhouse gas emissions will lead to disastrous consequences unless the earth's inhabitants make lifestyle changes.

Interestingly, the site allows a person to pledge to do certain things, like replacing light bulbs with more energy efficient ones. Seeing how many people are pledging to follow these simple tasks is a great way to demonstrate the compounding results of such actions.

Visit the site here: Yahoo!'s Earth Day 2006 Site

Technorati Tags: yahoo, search, earth day, environment

Yahoo! Reports First Quarter 2006 Financial Results

Yesterday, Yahoo released their Q1 2006 financial results during an investor conference call.

Yahoo's CEO, Terry Semel, reported revenues were $1.58 billion for the first quarter of 2006 — a 34 percent increase compared to the same period of 2005. It also represents the 12^th straight quarter of record revenue for Yahoo!.

There was also some other interesting tidbits released during the pesentation:

• 1 out of every 2 internet users in the world is using a Yahoo service every month – this includes Yahoo email, IM, search, flicker and other properties in the Yahoo! network.
• The Yahoo! Mail beta was extended to 6 more countries.
• Flicker continues to grow, experiencing the 100 millionth uploaded photo in March.
• Yahoo! will roll out a new advertising management application, to further efforts to aid advertisers in ad creation. I welcome this as great news, and parts of the current tool set are a bit tedious. The phased rollout is going to take place by country.
• Pay-per-click banners will soon include some sort of relevance as a ranking method, not just bid price. Google already uses a similar method for ranking pay-per-click ads.

Highest Trafficked Sites on the Web are Search Engines

Not so long ago, Amazon and eBay were the top trafficked sites on the Web. They would alternate at the top spot, as the web's head honcho.

Authors wanted their books listed on Amazon, and individuals and companies selling nearly anything under the sun wanted to be listed on eBay. (And they still do, they are great resources.)

According to Alexa’s traffic rankings, Amazon and eBay have been displaced by (surprise!) search engines. Yahoo, Google and MSN hold the top three spots in global traffic and US traffic.

A few years ago, companies (and individuals) wanted to list their products on Amazon and eBay because that is where the eyeballs of the world were.

Where do you want your products listed today?

Technorati Tags: google, msn, ecommerce, seo, search, yahoo

Yahoo’s Terrible Claria Deal

Yahoo! Japan has just inked a deal with Claria to distribute its software application called PersonalWeb. This application will gather anonymous user behavior to refine content and display targeted ads. [ClickZ has more information on the agreement.]

Claria was formerly the purveyor of GAIN – a notorious pop-up inducing adware program. Having dealt with GAIN in the past, I have seen firsthand how difficult it was to remove from a computer.

Occasionally, I visit my local Barnes & Noble’s to do some browsing. With more books than bookshelves, I still can’t stop myself from going up and down the aisles and buying a few titles that catch my eye.

But just by entering a Barnes & Noble, I would not expect to provide information about where I was just before that, what I was looking for, what other bookstores I visit or titles I have purchased. No one would enter a brick & mortar store if that were the case.

Yet online, this happens all the time. With the simple act of visiting a site, a site owner with a decent analytics program can see if that customer came from a search engine, what word they typed in, what city you are in, and any number of other things.

Claria’s new tool will gather this information across the web, providing a plethora of information about an individuals surfing habits. This potentially exposes all kinds of data, such other sites users have been to and what they were looking at when they were there. Claria says this data is “anonymous,” but in the online world, that only means they will not associate your name with your profile. But they want to know as many other things so they can target ads directly to you. That hardly sounds “anonymous” to me.

This is a terrible partnership for Yahoo! Japan, especially during a time when the Department of Justice is issuing subpoenas to search engines for user data. The web population at large is just now becoming aware of what types of information are tracked, how that information is made available and how it is used.

Yahoo Japan is partially owned by Softbank, an investor in Claria, which is probably the main reason why Yahoo! Japan became part of the deal. But it also provides a large, tech-savvy web audience to test the application before we see it in the US.

Search engines need to help the general web population understand what data they store and who they will share it with. Adding Claria to the mix muddies the water for Yahoo!.

Accoona – Real Potential or Hype?

NYTimes.com has a good story about Accoona.com, a new search engine that could have real potential. [NYTimes.com Article link: Searching the World, From Jersey City]

Sometimes I wonder why someone would start a search engine now, with the industry being utterly dominated by the big three – Google, Yahoo and MSN. Unless, of course, a new engine has a novel twist.

Accoona has this novel twist. They claim to have a form of artificial intelligence powering the engine -- that’s marketing speak for “lateral matching.” This means it can provide search results that do not necessarily contain the actual keyword in the query.

As an example, if you search for “Lord of the Rings” it might also provide you results on Orlando Bloom, even if the words “Lord of the Rings” do not appear on that page.

This is a very intriguing feature for a search engine. Accoona is trying to delve into user intent, or trying to determine the true meaning behind what the searcher is looking for.

While this lateral searching ability can be handy, Accoona is missing other features that have come to be considered standard to many search engines, such as image search. Currently Accoona only offers three types of searches – web, news, and business.

All the press given to Accoona in the past week reminds me of the press Teoma received when it was first launched. I even recall one headline ambitiously referring to Teoma as the “Google killer.”

But, ultimately, Teoma failed to live up to the lofty expectations. Even after being purchased by Ask, Teoma failed to garner any type of market share or general interest it had at launch. Teoma, and its technology, has now been completely absorbed by Ask.

Is Accoona a rising star or another engine getting hyped more than it should? Search engine companies are now expected to deliver on so much more than just search. They are expected to deliver news, email, instant messaging and a host of other features. Given the break-neck pace of the search industry, I can’t imagine how Acconna could catch up.

The lateral search function, or in their terms, artificial intelligence, is quite nice. Added to their Chinese roots (think: emerging markets), I expect Accoona will be purchased by one of the other, bigger, players.

Search Grows by 630 Million Searches in a Single Month

Just when the marketing industry was wowed by reports of increased search usage, newer statistics indicate the growth is continuing.

According to Nielson//Netratings, their were 5.7 billion online searches in January in the top 60 search engines, making it the most active search month ever recorded.

That is a whopping 630 million more searches than the month before!

While a slight post-holiday decline may have been expected, the reach of search marketing is stronger than ever.

While this is great news for the industry itself, it is a bit of a dark cloud for MSN Search. Despite this incredible growth, only Google and Yahoo! experienced increased market share. While each grew one point, MSN Search’s share declined by two points.

I guess buying searchers must not be working for them.

Search Engine Use Increasing Exponentially. Are You Taking Advantage?

Last week Nielsen//NetRatings announced the search market has grown 55% in the last year.

The Kelsey Group is predicting local search will increase 30.5% over the next four years.

Today, Nielsen//NetRatings reported that Google and Yahoo sponsored link impressions have increased 16% in the last six months. In January alone, Google and Yahoo served almost 65 billion sponsored links!

Yet with all this rabid growth in the search channel, many companies are still not investing in this method of reaching customers, new or old. Likewise, there are also plenty of interactive agencies that fail to implement anything other than the simplest of search techniques for their clients.

The marketing "sweet spot" is reaching someone with your message when they want to buy products in your niche. That is exactly what search marketing does on a daily basis – presenting results (messages) to potential customers (searchers) right at the time they are looking for the information.

Search marketing has long past its tipping point. It is here and it is going to stay. It won’t be long before more people are going to experience your brand and products through a search engine results page than a TV commercial. Why not reach them at the moment they are looking for what you offer? If you are working with an interactive agency, ask them if they can deliver competent optimization as part of the project.

I will give a tip of the hat to the Ford Motor Company, though. They recently reported they have sold more than 250,000 vehicles through FordDirect internet referrals. The oldest car maker in the world is using a new channel of marketing to sell an old technology (cars) to an audience that is growing more reliant on search.

Pontiac, on the other hand, got it all wrong.

MSN to Offer Bribes for Searchers

MSN is going to offer prizes to searchers in an effort to peal market share away from Google. Yahoo! is said to be considering a similar offer. Details of MSN’s plans can be found here: MSN Search and Win.

This would be interesting if it were novel. IWon started in this fashion by offering cash prizes to users who searched and read news stories on their site. They still offer prizes, including a chance to win $25 million.

Despite this, IWon has zero market share.

Google is in the lead for a single reason – relevant results. No gimmicks, slight-of-hand or cash bribes needed. Until MSN, or any other engine for that matter, produces results that searchers find as or more relevant, Google will continue to lead the pack.

Google is the Next Yahoo!

Recently, I have been reading The Secret Life of Water by Masaru Emoto. [Amazon.com link] He describes an interesting analogy regarding growing tomato plants with hydroponics.

Using hydroponics, a single tomato plant can produce thousands of fruits over its life. If you are like me and plant tomatoes in your backyard every year, a few dozen fruits is a plentiful harvest.

But the hydroponics gel the plant lives in provides so many nutrients that the plant does not expend energy growing roots to search out water and food. Because of this, the plant can devote all its resources to doing what it does best – producing big, red, juicy fruits.

Emoto then compares this to a job environment. If a person can find the supportive foundation, they can fully devote themselves to what they do best, producing exceptional fruit of good labors.

That analogy also spoke to me as a search marketer. When Google first began indexing Web content, its sole focus was producing one thing – the most relevant results. Google was growing in its own hydroponics lab.

Clearly that focus paid off. In just a few years, Google steadily gained market share and has become nearly unrivaled. Why? Because Google created an environment where only one thing mattered - search.

Yahoo!, on the other hand, took a different approach. Instead of focusing its energy on a single thing, the company produced many products for many different niches. The homepage became a portal; it offered email, instant messaging, chat rooms and any number of other things. As a result, Yahoo! lost favor with searchers and become what every other engine became – not quite Google.

But now the story is changing. Google is no longer that tomato plant devoting all its resources to growing a single fruit. Google is now wiring San Francisco with Wi-Fi, offering email, instant messaging, VoIP, video, satellite photography, and probably 50 other products still in beta.

Wouldn’t it be ironic if Yahoo! unseated Google because Google became the next Yahoo!?

Search as Part of your Shopping Cart

Holiday and comparison shopping go hand-in-hand. Who doesn’t want a good deal when you’re buying a small mountain of gifts for family and friends? New data suggest that shopping and search engines now go hand-in-hand as well.

Hitwise found that 11.1% of all December shopping related visits started at Google. Yahoo! added in another 4%.

More than one of every ten holiday purchases online started at a search engine!

Search engines are becoming a natural part of the buying funnel and they make a perfect gateway when comparison shopping. Typing in more specific product names net a large return of sellers. A few clicks and a shopper can quickly see who is offering better pricing.

Look at your site stats? Where are people entering your site? It is not uncommon for well optimized, highly product driven sites to have two-thirds of site visitors enter on a product page – not your home page.

Google just became part of your shopping cart.

Google in the Lead

According to comScore Media Metrix, Google increased its market share, leading by a full 10%. With a marketshare of 39.8%, Google widens its lead over Yahoo! with 28.5%, and MSN with 14.2%.

For some, this will reinforce the "follow Google" movement. Far too many search marketers disproportionately focus on a single engine, which can reduce the effectiveness of a search campaign. After all, Yahoo (with "only" 29% of the market) is still a doorway to a huge audience.

I have written about this twice before, and I think it offers valuable perspective if you are looking at optimization and banners. (Article links: Widen the Point of View and Lack of Search Loyalty)

In short, don’t let your search marketing firm focus to closely on Google, or any single engine.

Keywords Offer Glimpse into American Psyche

I do a lot of keyword research for clients. It's really the cornerstone of a good search strategy. Sometimes I find that it offers an interesting insight into the psyche of searchers.

This week I completed a keyword research for someone in the fashion industry. I found it interesting to learn how many people search – every single day – on how to become a fashion model for that company. Evidently there are many people out there that think they look as good as the commercials.

Often, URLs themselves are highly searched terms. "Yahoo.com" and "Ebay.com" often show up high on keywords lists. This points out the overall technical knowledge of the average searcher. Despite knowing the exact web address, many users do not type it in the address bar, but rather typed it into a search field at a search engine which was likely their homepage.

Which brings us to Yahoo's list of most popular search terms of 2005. (Here are the top terms of 2004, for comparison.)

The top overall searches are lead by Britney Spears, followed by 50 Cent, Cartoon Network, Mariah Carey, Green Day, Jessica Simpson, Paris Hilton, Eminem, Ciara, and Lindsay Lohan.

Clearly pop culture holds our attention.

It's Getting Crowded in Here

By 2007, the pay-per-click arena is going to be crowded.

In the last few weeks, several search properties have announced new or upcoming pay-per-click programs. Ask Jeeves announced a pay-per-click system to augment Google's pay-per-click method they use now. MSN Search has also announced more details on a PPC model that they call MSN Keywords, followed by Yahoo’s announcement of an ad network for smaller to mid-tier publishers.

Up till now, there were basically only two choices – Google's AdSense Program and Yahoo Sponsored Search (formerly Overture). With all the new choices, how do you get started with a pay-per-click campaign? Think about print ads.

I'm not suggesting you place print ads instead. I’m advising you think of the methods of placing print ads. Marketers place print ads based on where the target audience is.

With pay-per-click, marketers mostly factored in budgetary concerns. But as the arena gets more crowded, a search engine's demographic will be an important factor to make sure your ads are reaching the right eyes – and capturing the right clicks. A mouse click (just like a print ad impression) from someone outside your target audience is a lead that is less likely to convert, lowering the overall ROI.

For example, comScore data from June showed Yahoo, MSN, AOL and Ask Jeeves, skewed toward women, whereas Google has a higher percentage of male users. There are many ways, of course, to analyze demographic information. And it will be an increasing factor in the overall search strategy, especially to companies that have limited pay-per-click budgets or want to start of small to test the waters.

Yahoo Ups the Ante

Announcing an ad-serving program called the Yahoo! Publisher Network, Yahoo is now directly competing with Google’s AdSense program. Up till this point, Google was the only engine offering an ad program of this kind.

Yahoo has been making big strides on challenging Google this year. And it’s perfect timing. In general the media has been focused on a Google vs Microsoft battle, which allows Yahoo to innovate quietly, off the radar. It’s almost as if everyone forgot that Yahoo is still the number 2 search engine.

By my estimation, the Yahoo! Publisher Program surpasses Google’s AdSense program. Google does not pay on an AdSense account until a site surpasses $100. With so many lesser-read blogs using AdSense that can be an unrealistically high watermark to meet. For many, it must feel like that check from Google will never come.

With the program aimed at small- and medium-sized web sites, I hope Yahoo sets their payment schedule lower, down around $20 or so. That would provide a real benefit to people using their ads.

The Yahoo! Publisher Network is open to invited sites only while they are still in beta. I wonder if Google can counter before the end of the year?

Yahoo Index Update

Last night Yahoo began an index change. They anticipate it will allow for deeper crawls on sites. Yahoo reports that rankings will fluctuate as the index changes continue over the next two weeks.

Advice: If you notice ranking changes on targeted site keywords, it would be best to not react in hast until the index change is complete and the ranking changes settle back down.

Ultimately, changes like this are good.

The Better Mouse Trap

Click fraud is becoming a hotter and hotter topic, especially with a recent lawsuit filed against Google. Click Defense claims Google is well aware of click fraud and they are not acting to stamp out this practice. Google says they routinely refund money to advertisers that are victims of click fraud.

Click fraud consists, basically, of companies or individuals that click on pay-per-click ads for the purpose of driving up (or rather, drying up) a marketing budget.

Even the FTC believes it's time to take action. Howard Beales, FTC’s Director of Consumer Protection Bureau, told a Senate subcommittee that click fraud causes "significant injury to consumers and harms public confidence in the Internet as an emerging marketplace."

Snap.com thinks it may have fixed the problem. Instead of charges being based on clicks, the charge would be based on actual conversions. Meaning, no fee is charged unless a click through leads to a purchase.

BlowSearch has offered a solution called Click Defender, still in beta. It is a real-time auditing tool designed to separate humans from click crazy bots. When a user clicks on a link, Click Defender authenticates 20 different points of information in combination that BlowSearch says cannot be faked.

These efforts by Snap.com and BlowSearch are not silver bullets, but it’s a great start. But the bigger issue, which I think the lawsuit is trying to force, is why have the major engines been so casual about trying to solve this problem?

It is time for the two leaders in pay-per-click, Google and Yahoo, to make customers feel more at ease before the lawsuits mount and marketers loose even more money.

Search Toolbars for your Browser

Last week Google has released the beta version of their essential toolbar for Firefox. I know many users that were holding out on switching browsers because they felt they couldn’t do without their trusty toolbar. Overlooked in this news however was Yahoo’s toolbar for Firefox.

Since many search engine companies play follow the leader, I will be interested to see if other toolbar applications, such as Alexa’s, follows suit. Most telling would be if Microsoft releases a Firefox build of their MSN Search bar.

Toolbars for your downloading pleasure (in no particular order):

Alexa Toolbar

Google Toolbar

MSN Search Toolbar

Yahoo Toobar for IE
Yahoo Toolbar for Firefox

AltaVista Toolbar

AskJeeves Toolbar

Dogpile Toolbar

Teoma Toolbar