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Search Prices Rise in April

Keyword prices for paid search advertising exhibited a healthy increase in April, jumping 11 percent due to seasonal increases in leading categories and the entry of several new advertisers, according to the latest Keyword Price Index from search engine marketing firm Fathom Online.

Fathom attributed much of the growth in April to the continued adoption of online auctions for keyword ad sales, which they said attracted more advertisers to come on board.

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Display Ads Influence Search

Display ad campaigns greatly increase clicks on search listings, according to a new study.

Yahoo and online financial services provider Harrisdirect tested the effects of a display ad campaign run across the Yahoo network on search behavior. The study found users shown Harrisdirect display ads conducted 61 percent more searches relating to financial services. Those shown display ads also clicked on 249 percent more paid search listings and 139 percent more Harrisdirect search listings, both paid and unpaid.

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Google Sales, Profit Growth Continues

Google continued its sharp growth trajectory, reporting sharply higher first-quarter revenue and profits.

The Mountain View, Calif., search giant said revenue was $1.26 billion, up 93 percent from the first quarter in 2004. Excluding revenue shared with search distribution partners, Google's sales were $794 million. Google's net income for the fourth quarter was $369 million, or $1.29 per share, compared to $64 million a year earlier.

Google's Q1 results improved on the holiday quarter, which tends to be stronger. Sales, excluding revenue shared with partners, were up 21 percent sequentially. Net income was up 80 percent.

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MSN Gains Search Market Share

Microsoft's MSN has begun to pick up search market share from industry leader Google, according to an Internet measurement firm.

Nielsen/NetRatings reported that MSN attracted more searchers in February. The New York research firm said MSN's search market share jumped from 12.8 percent in January to 14.2 percent last month.

That growth came at the expense of Google, which saw its share of the search market drop from 47.1 percent to 45.9 percent, according to Nielsen/NetRatings. Yahoo's share of searches remained basically flat, going from 21.2 percent to 20.9 percent.

MSN introduced its search engine Feb. 1, backing it up with an estimated $150 million ad campaign designed to get consumers to try MSN Search. MSN ran TV ads during the Super Bowl, Academy Awards and Grammys. It has also heavily promoted the search engine throughout MSN and on dozens of Web sites, including Weather.com and NYTimes.com.

While the Nielsen/NetRatings figures show MSN taking searchers from Google, another measurement firm has contradictory findings. ComScore Media Metrix reported MSN's search market share remained unchanged at 16 percent.

BlowSearch Offers Pay-Per-Click Ad Program

Upstart search engine BlowSearch.com is launching a unique pay-per-click advertising program that will allow advertisers to cherry-pick where to place ads among the affiliate search sites in BlowSearch's partner network.

Executives believe this feature, which is not currently offered by search giants Yahoo and Google, will give BlowSearch a competitive advantage as the search market continues to expand.

In addition, BlowSearch is offering advertisers a means to defend against click fraud--the growing practice through which Web sites or competing advertisers deliberately click on search terms with the goal of either driving up individual site revenues or eating into advertisers' budgets.

BlowSearch offers a blocking tool through which advertisers can enter suspect Web sites' IP addresses, preventing these sites from receiving paid search ads.

MSN Confirms Paid Search Ambitions

Microsoft plans to announce today that it has developed a paid search platform that it will test over the next six months.

The pay-per-click system gives advertisers insight into audience data for their keyword selections, such as the searchers' demographics, geographic location and lifestyle data like income level. MSN said it would test the service in France and Singapore, then evaluate it before introducing it to the United States and other parts of the world.

"It's not about clicks," said Joanne Bradford, MSN's vice president and chief revenue officer. "It's about giving people data and insight into the audience they're reaching."

The paid search system will serve as a plank in a larger Internet ad platform Microsoft is building called adCenter. Bradford said adCenter would eventually let advertisers connect from a single point to target specific audiences throughout MSN, using search, display advertising and other marketing options.

MSN's development of a paid search platform will give advertisers a third option for running search advertising campaigns that reach large audiences. MSN is the third most popular search engine, drawing about 16 percent of all searches, according to ComScore Media Metrix.

MSN's paid search platform was widely expected, particularly once Microsoft identified search as a major corporate initiative. Last month, MSN introduced its own Web search technology, backing it up with an estimated $150 million ad campaign. It has a contract with Yahoo for paid search listings through June 2006.

"We believe very strongly in our Yahoo-Overture relationship," Bradford said, while adding that the contract is not exclusive.

Google Local Lets Businesses Amend Listings

Google said it added a new tool on its local search engine for businesses to create, delete or edit their business listings.

The Google Local Business Center gives businesses the option of changing their address, phone number, hours of information, Web site address, business description information and other listing details. To guard against alterations from competitors, Google said it sends businesses that request changes a pass code in the mail that allows them to go online to edit their listings. The service is free.

Google Local displays business listings culled from database companies, along with results from its Web index and locally targeted text advertisements. Previously, businesses could request changes to their listings by sending Google an e-mail message, which it would then pass along to its database partners. Google does not disclose its database partners or the number of business listings in Google Local.

Yahoo Local allows businesses to add business descriptions, links to promotional offers and photographs for a $9.95 per month fee. Businesses can add and edit their basic business listings for free on Yahoo Local.

Microsoft To Enter Search Ad Arena

Microsoft executives have quietly started briefing key search marketing executives on a new pay-per-click search advertising system, sources said.

This follows news last week that Yahoo executives expect to lose their company's search-advertising deal with MSN, when it expires in June 2006.

The new platform, which sources said would launch by the end of the year, would give advertisers more advanced ad targeting options than Yahoo and Google, according to one executive who previewed it.

Microsoft representatives declined to comment on the new system, but according to a Microsoft researcher's risumi, which was found posted on the company's Web site, the new bid-management tool is called Moonshot, and it has an automated keyword-suggestion feature and contextual targeting that can display the advertisements on Web pages and Instant Messenger, as well as on television.

Microsoft, which has required those briefed to sign strict non-disclosure agreements, also would not comment on the meetings or whether it would replace Yahoo's search advertising.

But there is a general industry consensus that a Microsoft search advertising system is inevitable, given the company's release of its own Web search engine last month. "The clock is ticking and Microsoft is obviously serious," one source said.

A Microsoft paid search platform would add a third widely distributed outlet for search campaigns. Google and Yahoo's search advertising programs currently control 98 percent of the market, according to ComScore Media Metrix.

Microsoft is still building its search advertising sales infrastructure, according to sources. Microsoft employment recruiters have called potential candidates to fill a position to lead MSN's search ad sales strategy. And, in December, Microsoft recruiters posted listings for staff account positions for a new pay-per-click advertising platform on employment Web sites.

AJ Sexton V

Yahoo Co-founder Discusses Future Endeavors

In a wide-ranging keynote "interview" today with Yahoo cofounder Jerry Yang, which opened day two of the Search Engine Strategies Conference in New York, Yang spoke on his company's growing search prowess and dropped a few hints about the Web-giant's future marketing endeavors.

With regards to search, Yang clearly indicated that Yahoo can claim the leading position in the search marketing business, a position currently held by Google. "When you think about all aspects of search, you should think about Yahoo," he said.

To that end, Yahoo announced on Tuesday that its Overture Services division, the paid-search arm that it acquired in 2003, would be renamed "Yahoo Search Marketing Solutions."

Yang's hope is that Yahoo's growing array of search products will expand the medium's uses, as well as user expectations about search. "Search is not just about destination," he said.

One of those new search products, the recently-launched Y!Q, allows users to highlight a selection of text while reading content and conduct related searches on that text without leaving the Web page they are visiting. While Yahoo had previously maintained that Y!Q would be advertiser-free, Yang said otherwise. "Our hope is to provide monetization solutions [for Y!Q]."

As he spoke about the merits of personalized search, Yang also intimated that Yahoo may explore some sort of behavioral targeting play related to search. The company launched My Yahoo! Search last fall, which theoretically provides users search results that take into account their past search activity. "Preference-based search...it's a tremendous value," he said. Whether that value translates to ad dollars remains to be seen.

"It's about how is Yahoo or the industry going to get their first," he said of the trend toward personalized media. "It's a huge business opportunity."

Yahoo to Drop Overture Name From Search Unit

Yahoo's Overture Services said it would change its corporate identity to Yahoo Search Marketing Solutions.

The name change reflects how integral Pasadena, Calif.-based Overture has become to Yahoo, which spent $1.6 billion to acquire the paid search company in October 2003. As Yahoo Search Marketing Solutions, the unit will serve as a single source for search marketing, from paid placement to paid inclusion to shopping search listings. Yahoo executives said one of the attractions of the deal for Overture was the opportunity to sell a variety of marketing products, including Web site building and display ads, to Overture's diverse customer base that includes thousands of small businesses.

"The rebranding of Overture to Yahoo Search Marketing Solutions is trying to say when you think about search—all aspects of search—you think about Yahoo," Jerry Yang, Yahoo's co-founder, said at the Search Engine Strategies Conference in New York.

Overture was begun in 1997 as GoTo.com, which was changed to Overture Services in September 2001. At the time of Yahoo's acquisition, the retention of the Overture name reflected its status as a Yahoo subsidiary that would try to balance being part of Yahoo while also working with its rivals, like Microsoft's MSN, as distribution partners.

"It's really going to be business as usual with our partners," said an Overture representative. MSN last November renewed its contract with Overture through June 2006, although most industry analysts expect it will build a search-advertising platform of its own.

Overture plans to formally change its brand identity in the United States in the next couple of months. Overture's international units, except Japan and Korea, will follow suit. The Overture brand will be maintained in Japan and Korea.

Study Sees Openings for Google Competitors

While Google retains a sizable lead in the search market, the Mountain View, Calif., search giant is vulnerable to user defections to alternative search engines offered by Yahoo and Microsoft, according to a study.

Nielsen//NetRatings said its Internet user data showed Google far outpacing Yahoo and MSN. In January, Google handled 47 percent of Internet searches, compared to 21 percent for Yahoo and 13 percent for MSN.

Fifty-eight percent of Google users, however, also use the search engines of Google rivals Yahoo and MSN. With few barriers to switching search sites, the research firm concluded that Yahoo and MSN could gain "significant" market share by developing innovative search applications.

"Google is the search engine to beat," said Kaizad Gotla, an Internet analyst at New York-based Nielsen//NetRatings. "The majority of their users are still up for grabs. It poses an opportunity for their competitors, and it poses a threat to them."

While a majority of Google users also searched elsewhere, Google had better search loyalty than Yahoo and MSN. More than 70 percent of their users visited other search sites. Yahoo and MSN lose many users to Google: Yahoo shared 39 percent of users with Google and MSN shared 33 percent.

Nielsen//NetRatings, which collects data on the search habits of 250,000 users through its MegaView Search panel, has far different search market figures than ComScore Media Metrix, the other major Web data provider. ComScore pegs Google's lead over Yahoo as much narrower: 37.4 percent to 31.9 percent. Gotla said Nielsen//NetRatings does not include internal searches that are not related to paid search.

"These are the searches that are monetizable by the search companies," he said. "Yahoo doesn't get any revenue from you searching for stock quotes."

Multi-Term Searches Get High Conversion

Marketers who restrict their keyword buying to a short list of broad search terms may be missing out on potentially high-value customers. A new study released by search-optimization firm Oneupweb indicates that multiple keyword searches, where users input three and four search terms at a time, deliver considerably higher conversion rates than single-term searches.

Through reviewing data on thousands of real searches tracked during July, October and December of last year via the company's proprietary search analytics tool, ROI Trax, Oneupweb found that conversion rates rose steadily from single-term searches to four-term searches, declining thereafter.

For example, in July 2004, the study found that the average conversion rate for single-word phrases was roughly 10 percent. For four-word phrases, the rate jumped to more than 20 percent.

Campaigns are eligible that use at least three distinct communication channels, including both traditional and non-traditional media. There is no limit in terms of the number of communication channels used and the length of the execution.

"Longer searches drive a more qualified user," said Lisa Wehr, Oneupweb president. "They are already through the education process. They are in buying mode."

The study also found that the conversion for single-word searches lessens when corporate names are removed from the study. Users who include corporate brand names are further along in their decision process, while those who search using more generic terms are not, according to Oneupweb. During the same July time period, the conversion rate for single-term searches was around 8 percent minus corporate terms, jumping to 33 percent for four-term searches.

While Oneupweb's research deals exclusively with "natural" search terms, Wehr believes there are obvious applications for marketers active in the red-hot paid search space.

"I think it would definitely apply across both verticals," she said. "The end result in either case is conversion."

But many companies are failing to recognize the value of multiple-term searches, sticking to a short list of in- demand words, says Wehr. "There are a lot of companies buying very broad keywords and are paying a high [cost-per-click]," she said.

Part of that strategy may be simply that many companies value certain terms for branding as much as conversion. But competition is a factor. "It's an auction, and a lot of people get caught up in that," said Wehr. "Companies are dukeing it out for the sake of dukeing it out."

That scenario is a tough one for small- and mid-sized businesses to navigate. Wehr says that these companies can benefit the most from expanding their list of search terms. For example, for a smaller technology company, trying to outbid giants like Dell and IBM for search terms like "computer" can be a losing proposition. "If you are a small reseller in Hoboken, New Jersey, what are the chances of making that profitable?" said Wehr.

That's why these businesses should consider multiple-term searches. While the level of traffic for these searches is much lower than more broad, single-term searches (more users search for "computer" than "computer for my office"), small- to mid-sized companies can attempt to aggregate search traffic through multiple-term buys, while enjoying greater conversion potential.

Of course, buying search terms, particularly more varied and interchangeable word combinations, can be time- intensive. However, "there are really good tools out there," said Wehr. "There should be less overhead in the end."

Keyword Prices Down in January

Just as retailers typically slash prices following the holiday shopping season, keyword prices for the major search engines fell in January.

According to Fathom Online, a search marketing agency that tracks keyword pricing, advertisers paid 3 percent less for clicks than the previous month, the heart of the holiday shopping season. Fathom estimates that $23 billion was spent online during the 2004 holiday season.

One of the largest category drops was found among telecom-wireless products, which saw keyword prices skid by 28 percent, from $1.09 to 79 cents, as cell phone gift-giving faded out.

Keywords in the consumer-retail category also slipped by 11 percent from 58 cents to 52 cents per keyword, erasing some of the major pricing increases seen in the category during the height of the fourth quarter shopping season, according to Fathom.

"Much of the data reflect advertisers' seasonal purchase behavior patterns," Chris Churchill, CEO of Fathom Online, said in a statement. "As we continue to track and analyze enormous amounts of data, we are learning more and more about how advertisers and consumers interact in the search auction market."

Bucking the trend in January were rates for mortgage related keywords, which continue to demand the highest keyword prices on the market, as marketers target first-time homebuyers and those looking to refinance.

Google Moves Local Search to Home Page

NEW YORK Google said it added a link to its local search engine on its home pages in the United States and Canada in an effort to introduce the service to more consumers.

The Google home page, which drew 67 million U.S. visitors last month, now carries links to Google Local, Google's shopping search engine Froogle, user groups and image and news search. Previously, users needed to visit local.google.com for the service. Local search results also appear in response to relevant Google searches.

Local search has emerged as a key growth area for search engines, which see an opportunity to tap into the $14 billion U.S. local businesses spend on offline directory advertising. Google Local carries advertiser listings tied to searches. For example, a New York pizzeria could pay each time its ad is clicked in response to pizza searches done in Manhattan.

"We are very bullish on local, but I think also people should understand that it will take time to get adoption of all these services and also to make them work really, really well," Larry Page, Google's president of products, told investment analysts earlier this week..

Google Local launched in March 2004. Yahoo, Ask Jeeves and Amazon's A9.com offer competing local search engines

MSN Debuts Search Engine

Microsoft's MSN unveiled its new search engine, positioning itself to battle Google and Yahoo in search applications by providing users with direct answers instead of lists of Web pages.

MSN executives said the search engine, under development for 18 months at a cost of $100 million, would steal market share from Google and Yahoo by offering users a more useful search experience than currently offered by search engines.

MSN Search, which MSN released in a test version in November 2004, replaces Yahoo Search on MSN's properties in 25 markets. It draws on MSN property Encarta to provide direct answers of facts and figures to approximately 1.5 million searches. MSN Search's Web index includes more than 5 billion documents.

Searches for music return links to music files and other content from MSN Music, including the ability to buy songs. MSN Search tabs let users narrow their search to categories like news or images. Another tab lets MSN Toolbar users include results from a search of their computer files.

MSN executives said the search engine would add additional features over time to further differentiate it from the current search market leaders, Google and Yahoo.

"We think there's a hunger in the marketplace for another search competitor," said Bob Visse, director of information services at MSN.

MSN is the third most-used search site, according to ComScore Networks. In December 2004, MSN drew 16 percent of Web searches, compared to 34.7 percent for Google and 31.9 percent for Yahoo.

MSN plans a wide-ranging ad campaign, using online and offline media, to generate consumer awareness and use of the new search engine. The portal has also redesigned its home page to provide a cleaner interface that loads faster and accentuates MSN search.

MSN's new search engine will continue to display text advertising from Yahoo's Overture Services division. MSN executives declined to comment on plans for the division developing its own paid search ad program. MSN and Overture have a paid search distribution deal that runs through June 2006.

Google Intros TV Search Function

NEW YORK Google today introduced Google Video, a service that lets users search the content of television programs from providers such as PBS, the NBA, Fox News and C-SPAN, among others.

"What Google did for the Web, Google Video aims to do for television," said Larry Page, Google co-founder and president of products, in a statement. "This preview release demonstrates how searching television can work today. Users can search the content of TV programs for anything, see relevant thumbnails, and discover where and when to watch matching television programs. We are working with content owners to improve this service by providing additional enhancements such as playback."

The Google Video beta site, www.google.com/video, enables users to search across the closed captioning content of a growing number of TV programs that Google began indexing in December.

Google Video also displays up to five still video images and five short text segments from the closed-captioning of each program, when the program will be aired next, and allows users to search for specific words within a given program.

Using search for branding?

I don't really know how well this would work, but it is intriguing, if you could get your brand messaging on Google, and pay minimally for it.

[from InternetRetailer.com]

Yahoo's new weapon in the search wars

I know I've been raving about Google a lot lately, but I don't know how they can compete with this--Yahoo's revolutionary new Soul-Search Engine.

What will they think of next?

Yahoo's new weapon in the search wars

I know I've been raving about Google a lot lately, but I don't know how they can compete with this--Yahoo's revolutionary new Soul-Search Engine.

What will they think of next?

The Google Operating System?

What is Google up to?

With the announcement of GMail, Google made everyone (most especially Microsoft and Yahoo) very curious. Unfortunately, much of the speculation in the media has been very short-sighted and rather limited in it's thinking. Until now.

Kottke's got a great post, which borrows ideas from another post, by Rich Skrenta. In short, Skrenta and Kottke are theorizing that Google is, in fact, building a custom operating system for the world, which will operate and interoperate across the world on any machine connected to the Internet. When you start to look at Google on this larger scale, not simply as a search engine or "portal", as much of the media was suggesting after last week's GMail announcement, the possibilities really become intriguing.

Nerds--start your engines.

[from Kottke.org]

Google readies free Hotmail competitor

Google is planning to roll out a free e-mail service. As if that alone weren't scary enough for MSN's Hotmail and Yahoo!, they will give away a free 1GB inbox, as opposed to the puny 2MB and 4MB users get from Hotmail and Y! Mail, respectively. Did someone just hear a big GONG? Maybe we can finally bid adieu to Hotmail and its suckiness.

Looks like the 'portal' wars are very much back in vogue. And Magnussen is hyping up next-generation digital entertainment. Wait a second....did I fall asleep and wake up in April 1999?

Why take my word for it?--check out Google email, or GMail, for yourself.

[UPDATE] You don't think this could be an April Fool's joke, do you?