Microsoft's solution to Google: cold, hard cash
Posted 23 May 2008 at 11:32AM by Ian Betteridge in Doing business online
With a share of the search market which borders on the non-existent, Microsoft has decided to use one of the oldest and most simple methods of attracting customers: cash incentives.
It's new "cashback" service offers discounts to shoppers who find products and services through the ads on its Live Search system, rather than using Google. Discounts will range from 2% to a whopping 30%, figures which are likely to turn consumer heads at a time of squeezed budgets.
For advertisers, this might prove to be an attractive option, as it means that users who click through on the ads are more likely to actually buy something, making the ads more effective for them.
With a search advertising share of 69% if you include the recently-acquired DoubleClick, Microsoft has a long way to go if it wants to topple Google. Microsoft currently has a share of a little under 10%.
However, the more immediate target for Microsoft isn't Google at all, but Yahoo!, which just leads it with 11.5%. So perhaps this move is a reminder to Yahoo!, which recently turned down a takeover deal from Microsoft, that it has very deep pockets and can spend heavily to become the number two player in the market.
Tags: bt, bt broadbandoffice, cashback, google, microsoft, search, search engines
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Comments
2. At May 23, 2008 1:20 PM, boon wrote:
Only open to US market? Bit silly Microsoft, with increasing online purcahses and a strong £ in the UK.
3. At May 23, 2008 1:26 PM, Chris Sabin wrote:
Microsoft as per usual lag behind everyone else.
Quidco is a much better service and available to us people in the jolly old UK.
Cant beat getting £95 back on a £150 sky instillation now can you ;)
Google will continue to dominate and with their joint efforts with Microsoft they will continue to grow stronger :)
Speaking of search, if you google something it will find something on microsofts website better than the search function on their website. Say much?
4. At May 26, 2008 12:00 PM, J G Dawson wrote:
In my experience Microsoft searching is both untrustworthy and uninspiring and I do get the impression that Microsoft has agenda's that are not immediately obvious to the user...
5. At May 27, 2008 11:03 AM, Chris Sabin wrote:
My bad, i have a typo.
"Google will continue to dominate and with their joint efforts with Microsoft"
Should be yahoo. Even someone like me can make simple mistakes from time to time :)
6. At May 27, 2008 2:10 PM, 'Razor' Ramone wrote:
"...and I do get the impression that Microsoft has agenda's that are not immediately obvious to the user..."
I think Windows Vista users can speak Testament to that!
However, on-topic, I think this is going to fail dramatically. Most people are not going to go out of their way to use a different search engine, even if it would save them money, simply because it is awkward to swap between them, depending on if you're searching for purchases or just generally browsing. Google's search algorithm is vastly superior to any other I've come across, so I know which I would be using for the latter.
Plus, Google has its own purchasable advertisement service, which, given its excessive monopoly on the Search market (if a search facility can be termed as such), most companies will continue to advertise using Google and therefore most users will continue to search using Google.
Plus, there is the question of how Microsoft intend to reimburse you for your purchases. Will you only get reductions on services that are paying to advertise on their search, then Microsoft reimburse the company? In that case it is of dubious value.
Or, do they intend to reimburse the consumer directly? That, to me, seems like a logistical nightmare. Perhaps there is a simpler method that I haven't fathomed, but it still seems like a lot of trouble even so.I just don't get it. At the end of the day, with a service like this, the more you draw people away from other search engines onto your own, the more you're going to be paying. I'd be surprised if they could make it lucrative enough to persuade people to adopt it, but still actually make a profit from advertising.
If this is a matter that they just want to be the biggest search provider, with money no object, there's a serious claim for a breach of monopoly law, at least in my opinion, which, for Microsoft, is a pretty major thing, given recent history in that department.
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1. At May 23, 2008 12:19 PM, google will not be toppled! wrote: