The battle of the search engines is hotting up with Microsoft's newcomer giving the market leader food for thought
For companies looking to market their brands online, only two questions count when it comes to picking the right search engine. Will the money we pay boost the volume of traffic to our website? And what proportion of those users can we convert into sales?
Until recently, the decision was simple: clear market leader Google, rival Yahoo!, or distant third-place Microsoft—or a combination of these. But in May, Microsoft announced the launch of its new search engine, Bing. Two months later, it teamed up with Yahoo! And last month, Google countered by announcing new technology Caffeine that its developers claim will make the market leader's search engine faster and more up-to-date.
For advertisers, the decision is now a two-horse race: Bing or Google? Under the terms of its deal with Yahoo!, Bing will be the underlying technology for Yahoo! Search. Microsoft chief executive Steve Ballmer promises that the deal means "better value for advertisers".
For now, it is not clear how the battle will play out in the UK. Bing is still in its testing phase here, with a full version set for launch later this month. Cedric Chambaz, a UK marketing manager at Microsoft Advertising, says 60 developers are working in London on adapting a local version of Bing to ensure that UK buyers can use it to find suppliers based in Britain.
Bing isn't just a search engine, says Microsoft—it's a "decision engine". It automatically suggests refinements to search terms and then delivers results that may be more relevant.
But is this approach more effective for online advertisers? Eye-tracking technology from User Centric, a US-based Web research specialist, believes it is. By following search users' eyeballs around Web pages to generate colour-coded "heat maps" in its labs, the company found that sponsored links from advertisers attracted more attention on Bing than in Google-42 per cent against 25 per cent. But together, Bing and Yahoo! account for just below nine per cent of worldwide searches, compared with Google's figure of more than 89 per cent, according to research firm StatCounter.
Microsoft argues that what Bing offers is quality over quantity. So far, Alan Toller, director of Fatsac, a Cornwall-based company that makes and sells bean-bag furniture, is impressed. "We found Bing through a magazine article and were surprised to find the Fatsac website on the first page for 'bean bags organically'," he says. So the company used the search engine to launch a comparison test, based on its AdWords campaign on Google, which connects customers with the company.
"Bing has outperformed Google in cost-per-click, at about 25 per cent lower, and on click-through ratio, at about one per cent higher," he says. "When compared with Google, Bing is great value and an excellent competitor."
It means advertisers may need to hedge their bets for a while, says Andrew Pearce, chief executive of Powwownow, a phone and Web conferencing provider. "Google is the most effective of the search engines and, while being the most expensive on a cost-per-click basis, it generates about 79 per cent of our new customers.
"It's a false economy to think you're paying too much for a click, when it's the conversion rate that matters. Bing is becoming a viable option for advertisers, but the reality is that Google has the lion's share of the paid online search market, and I don't see that changing in the near future."