Are you tired of just “searching” for information online? If so, Microsoft could have the solution. In June, Microsoft launched Bing, the first decision engine. “Bing is an important first step forward in our long-term effort to deliver innovations in search that enable people to find information quickly,” stated Steve Ballmer, Microsoft CEO. Bing’s objective is not only to provide relevant information quickly, but to also catalyze consumers to use that information to accomplish tasks and make smarter decisions.
In today’s search engine marketplace, instant access to relevant search results is assumed to be the standard. However, the population may be growing weary of having to sift through pages of search results in order to find the best answers to their search queries. A study by comScore found that 30% of searches are abandoned without a satisfactory result. In addition, approximately 66% of the remaining searches required a refinement of the search query.1 These results presented Microsoft with a great opportunity to address consumer challenges and increase its position in the search engine marketplace.
The Evolution of Bing
Bing is not Microsoft’s first attempt at creating a search engine. Rather, Bing is a phase two evolution of “Live Search,” including the best of what it had to offer. Bing’s homepage provides instant access to individualized search engines for images, video, shopping and travel. Auto-suggestions guide consumers to similar terms or common refinements to their search query. The homepage also features visually appealing imagery that is updated daily. Bing’s homepage has also been enhanced by the addition of hotspots which are embedded into the imagery. Though the hotspots are difficult to locate at first glance, they offer short factoids related to the images on the homepage once the user hovers over them.
Bing enhances the user’s search engine experience by quickly providing organized search results that can be filtered through intuitive tools that showcase the most relevant content. The left-hand navigation works like a table of contents, grouping similar results into categories. Also included on the left-hand navigation are a list of related searches and the user’s search history which can help refine the search query.
Bing also features tools within the organic search listings that aid in the consumer decision-making process. These tools include the following:
The Quest to Win Market Share
Bing’s market share is steadily increasing. In March of this year, Google maintained a commanding lead in terms of search engine market share with 72%. At that time the second and third players, Yahoo and MSN Live Search, maintained 17% and 5.6% market share, respectively.2 However, just four months later, Bing has made gains. comScore reported that for the month of July, Google’s market share was just 64%, while Yahoo increased to 19% and Bing achieved 9% market share.3
In addition to the enhanced functionality, strong media promotion can also be credited for Bing’s increase in market share. Reports estimate that Microsoft will spend about $80 million to support Bing’s launch. Bing has also generated a lot of industry press detailing its many new features, competitive comparisons and preliminary performance results.
Further illustrating its intent to become a serious contender in the SEM space, Microsoft announced a 10-year SEM agreement with Yahoo in late July. Under this agreement, Microsoft will have exclusive licensing rights to Yahoo’s core search engine technologies. Bing will be the exclusive search engine platform powering all Yahoo sites. Details regarding the financial aspect of the agreement have been scant. It has been reported that Microsoft is agreeing to pay Yahoo 88% of search revenue generated on Yahoo owned and operated sites during the first five years of the agreement. Yahoo expects the agreement to generate close to $500 million in operating income while providing cost savings of $200 million in capital expenditures.
MayoSeitz Media Perspective
Search Engine Marketing (SEM) is a highly efficient tactic for marketing to consumers, carrying a low barrier to entry due to substantially low budget commitments and minimal cost to produce text creative. The timeliness of SEM allows advertisers to reach consumers while they are actively seeking product information. The relevancy of ads to the search queries improves ad placement and positioning. Geo-targeting and dayparting tools can be easily employed to ensure that brand messages are targeted to the appropriate audience, increasing direct response rates that already outpace other media formats. Perhaps these advantages explain why the search engine marketplace continues to thrive, even in a down economy. Thus far in 2009, SEM has commanded more than $15 billion in advertising.4 Current predictions suggest that paid search spending will increase by 3.6% in 2009, a year in which other media forms are experiencing stark declines.5
Bing demonstrates a growth in Microsoft’s commitment to SEM. However, Bing is still experiencing growing pains including unreliable quality and inconsistency. The quality of search results varies greatly by category. The most notable inconsistency is that the Best Match is only available for a few search queries. Thus far, the Best Match rankings appear most frequently on branded searches. These growing pains have the ability to frustrate and alienate users, potentially driving them back to the market leader. Whether consumers will fully take advantage of all the new features is also questionable. For example, the hotspots will likely go unnoticed since a user has to hover over them before they appear. Most users will miss out on this feature entirely since the information-seeking mindset of the consumer and the habits formed from searching cause people to immediately begin typing into the search query field.
Paid listings on Bing have been noticeably few and far between. For advertisers, this could represent an opportunity, but Bing must first prove that it can achieve sustainable growth and consistency in order to make it a real contender in the SEM space. The partnership with Yahoo is certainly a step in the right direction. And, rumor has it that Bing 2.0 is set to release this fall, maybe even this week! The next release will supposedly add more generalized search functionality, as opposed to version 1.0, which was optimized to handle purchasing-specific tasks. MSM will certainly monitor developments carefully over the next few months to see if Microsoft finally has a search winner. Stay tuned.
1 Microsoft’s New Search at Bing.com Helps People Make Better Decisions, Microsoft, May 2009
2 Google Ups Share of Search To 72%; Yahoo, MSN and Ask Continue To Tank; Media Post, March 2009
3 Microsoft’s Bing wins share from Google, Yahoo, Reuters, August 2009
4 Traditional Marketing Budgets Lose to Interactive, Media Post, July 2009
5 Interpublic: Search Only Major Medium To Rise This Year, ‘Direct’ Outpaces National, Local Online Markets, Media Post, July 2009