Commentary

Microsoft And Yahoo's Secret Plan To Dethrone Google

MicroHoo!

Microsoft and Yahoo see the light at the end of the tunnel. Do you? The two search engines will soon provide marketers and advertisers an update on their search alliance in the works for the past year. The goal to complete the transition before the holidays, at least in the United States, appears to be on track, complete with a few positive, yet surprising, changes in store.

It's pretty simple, really. Build a relationship with your customers to keep them for life. Make it easy for them to do business with you. Keep them informed of changes and allow them to make suggestions you would consider implementing. That's marketing 101. I'm not sure Microsoft and Yahoo execs realize increased communication and customer service could have long lasting and far reaching effects for the combined search engine.

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Marketers and advertisers say Google made it easier to do business with them. Microsoft and Yahoo didn't, but now they have made it a priority by providing continual updates and asking SEM agencies for advice on features offered in Yahoo's ad platform Panama not previously available in adCenter.

The next wave of communication coming within two weeks will explain the algorithm transition and effects on the consumer experience, according to Betty Stooksberry, senior director of the search alliance at Yahoo. "The idea is to streamline how we service advertisers," she says. "It gives us an opportunity to reevaluate how we service advertisers, but really very little has changed other than the level of detail and frequency of updates."

Hello, Ms. Stooksberry, the "level of detail and the frequency of updates" has become the key to providing SEM agencies and advertisers that little extra customer service not previous seen through Microsoft and Yahoo.

In case you have been living under a rock for the past year, Microsoft and Yahoo announced a 10-year license search advertising partnership in July 2009. Through Microsoft's ad platform adCenter, Bing will serve up ads on the Yahoo network of properties. Microsoft will manage all backend search and paid search ad functions for Yahoo.

After the multimillion MicroHoo deal received regulatory approval, the two search engines stepped up communications with paid search advertisers about the transition. Early on, some marketers were skeptical, while others welcomed the change. Then things changed when the two started answering the difficult questions in May.

Every exec likes to think his company offers outstanding customer service. But that's not what consumers say, nor do search traffic and paid search ad sales reflect that sentiment.

Google continues to dominate search, but Microsoft and Yahoo will take a steady trek uphill. Since January, search market share looks like a rollercoaster ride with Bing losing ground and then gaining 7% in June, according to Experian Hitwise. That uptick gave the combined Bing and Yahoo Search alliance 24.22% market share in June, up from 23.94% in January. Google's search market share in June declined slightly to 71.65% in June, from 71.49% in January, the data firm says.

When Yahoo Chief Executive Officer Carol Bartz stepped in to take the helm in January 2009, the Sunnyvale, Calif., company gained a renewed focus on the consumer search experience across its network of sties. Aside from stepping up services for consumers, Microsoft and Yahoo have begun to sort through business processes. The companies realize that input from SEM agencies fosters ownership and pride in products.

Think of how brands like Mountain Dew crowd sources flavors and ad campaign. People want to become involved, know they helped make a change to better the industry and not just themselves.

Microsoft and Yahoo are finally listening. If the combined companies can increase search traffic and make it easier for advertisers to place ads, Google will have a formidable competitor.

Gary Ware, director of media operations at Covario, a search engine marketing firm based in San Diego, says Microsoft and yahoo have been "taking our advice to heart." Covario spends about $1 million to $2 million per month for search ads on Bing and Yahoo in the U.S.

That advice for Microsoft to add a campaign management feature took a couple of months, but now advertisers can tag by keyword type to get the exact phrase in broad context. "One concern we has was the way we optimize on Bing isn't always the same way we optimize on Yahoo, and that feature wasn't available in adCenter," Ware says. "We expressed that to the transition team, who pushed through the change to the development team."

SEM agencies and advertisers with sales contacts get updates on the search transition through reps, one-on-one meetings, collateral pieces like "leave behinds" after meetings, frequent check-ins via conference calls, emails, and recorded presentations. Those without sales reps get updates through emails, blog posts, Facebook/Twitter updates, Webinars that begin in August and September, and Detailed Transition Center.

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