Knowledge is the Foundation To Success  

The PPC advertising industry is constantly evolving, and the coming days or weeks will likely substantially modify the landscape as we know it. Microsoft recently swooped in and offered to buy Yahoo! for about $47 billion, which was greater than a 50% premium to what Yahoo!’s stock value was at the time. Yahoo! co-founder & CEO Jerry Yang killed the deal, demanding even more money to make it happen. Microsoft walked away.

The reality is, Microsoft really could benefit from Yahoo!’s 500 million+ worldwide users. That is a lot of users. Microsoft knows they need to do something drastic to compete with Google’s enormous, and constantly growing search query dominance. According to ComScore, Google again increased its leadership position in April, capturing 62% of all U.S. search queries – roughly 6.5 billion searches. 20% were performed at Yahoo! and 9% at Microsoft Sites.

Last week, Microsoft launched an initiative to reward their searchers with cash back if they buy something online. This may prove successful, but is not likely going to provide the answer Microsoft is looking for. So, has Microsoft really walked away from the Yahoo! deal?

To add to the current mix, in walks billionaire Carl Icahn. This guy has an impressive track record, and just picked up 50 million shares of Yahoo! He intends to wage a proxy battle to fire the current Yahoo! board and get the Microsoft deal completed.

Yahoo! argues that the buyout may not be in their best interest and that they are considering a partnership to run Google’s PPC ads alongside Yahoo! content. Testing has been completed and both parties are excited. Yahoo! can potentially earn far larger income from Google’s ads and save a small fortune on running their own PPC platform. Hmmm.

So how will this all play out? Time will tell, and likely soon. I am thinking Microsoft ends up buying Yahoo!. It would certainly be nice to see Yahoo’s new and improved platform replace the current Microsoft adCenter platform. Microsoft no doubt spent substantial time and effort in determining that they wanted to buy Yahoo!. I suspect that will still be the end result. Plus, it does not seem wise to bet against Carl Icahn. One thing is for sure; change is on the way.

I have had several clients contact me today regarding the Bill Gates announcement Wednesday March 22, 2008 on the “Live Search cashback” program, and I thought I would delay my scheduled Blog on Google Phrase Match to give you the inside skinny.

The bottom line here is that Microsoft plans to pay visitors who search and then buy products through Microsoft’s Live Search engine. More specifically, we are talking about Microsoft’s comparison-shopping engine appropriately known as MSN Shopping.

According to Microsoft, “The program rewards consumers with a cash back rebate for a purchase, and gives advertisers the opportunity to sell on a cost-per-acquisition (CPA) basis.”

This isn’t the first time that Microsoft has offered a “Cash for Search” incentive to consumers. For several months in 2006 the company offered almost $1 million in prizes for keyword searches, as well as a rewards program last summer. During both of these periods Microsoft’s search market share increased.

Ironically similar to Google Product Search, Microsoft Shopping also allows advertisers to upload their product database in an XML feed. Inclusion is completely free, and there are no charges for uploading your items or charges for the traffic you receive. However, if you join the BETA testing of “Live Search cashback” then you will most certainly pay a Cost-Per-Action every time somebody buys your product.

So, you may be asking yourself, “Why would I want to pay for traffic that I can get for free?”

Funny, this is the same question that I heard back when PPC Advertising came in to play.
Still, it is a good question.

The answer is competition. If your competition is offering the same exact product, however it comes with a nice cash back incentive, guess who’s going to get the sale.

According to Microsoft, some big ecommerce players have already opted into the BETA program including eBay, Sears, and Barnes & Noble.

If you would like to qualify to advertise with Live Search cashback advertisers must be:

• Headquartered in the United States
• A retail site with e-commerce capabilities
• Able to fulfill the physical shipment of a product
• Able to create and maintain a product data feed
• Able to implement a standard tracking pixel on your website’s order confirmation page

BETA programs are not right for everybody, and depending on your business model this program may or may not be right for you. JumpFly has dedicated representatives at all of the major search engines including Microsoft and we can help advise you on the requirements and possible pitfalls of these type of programs.