ISM Signpost #1
SIGNPOST is the monthly executive summary of the
internet search marketing industry.
10.05 ISSUE 1
To request further copies or to stop receiving
SIGNPOST, please email p.roberts@isearchm.com
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* Thomson, Yahoo! and Miva launch pay-per-call
* Google finds new medium for ad sales: print
* Yahoo! pushes consumers to trusted contacts
* Google and MSN combine mapping and search
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+++ HANGING ON THE TELEPHONE +++
Thomson, Yahoo! and Miva launch pay-per-call service
Despite the fact that e-commerce is no longer in its
infancy, a large number of consumers are still
reluctant to make purchases online. Some are worried
about posting their credit card details online.
Others simply prefer to speak to a real person over
the phone. Over 70 per cent of people who search
online then go and make a purchase offline. And this
is why pay-per-call services, a form of search
advertising which drives customers to a phone number
rather than a website, is gaining momentum in the UK
and the US. Indeed, competition is heating up in the
burgeoning UK pay-per-call market as Thomson
Directories announced its intention to launch a
pay-per-call service, hot on the heels of rivals Miva
(formerly FindWhat/Espotting) and Yahoo!.
The pay-per-call search model enables search
advertisers to pay for phone calls rather than
clickthroughs. This means they are only required to
pay for the ads that result in phone calls, in the
same way that pay-per-click advertising only charges
for visitors sent to a website. Pay-per-call services
remove yet another barrier to buying and selling
online. It is also expected to be popular among the
3.2m small and medium-sized businesses in the UK, as
around 2.7m of these do not have a web presence.
Previously businesses had to rely on an ad in the
Yellow Pages if they wanted to be called by new
customers
There’s no question that this new form of search
advertising has potential. Estimates from the Kelsey
Group predict that pay-per-call advertising in the UK
could exceed £600 million by 2009, and be worth
US$4bn worldwide by the same year. This compares to
nearly £258m spent on search in the UK in 2004, an
increase of 87.4% since 2003 according to the latest
figures from the Internet Advertising Bureau (IAB).
Search now represents 40% of online spend. In the US,
the figures are much higher with advertisers spending
$4.09bn (£2.15bn) this year on search marketing
programmes.
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+++ BRANCHING OUT +++
Google finds new medium for ad sales: print
Google, which built a lucrative business in online
search advertising, is dabbling in the old-fashioned
world of print. The company is buying space in
magazines and filling it with smaller ads from its
vast database of online clients.
It will be an interesting test to see whether
advertisers are willing to regard Google as the place
to buy all kinds of ads, rather than just online
space and become a kind of ad broker. Google is
buying space in specialised computer magazines such
as PC Magazine and Maximum PC. It is opening up a
traditionally more expensive advertising medium to a
raft of smaller advertisers, who would not be able to
afford to buy space individually. For example, the
CEO of Coffeecup Software, a Google client, whilst
they rarely advertise in magazines, is reported to
have described the services as being “like Coca-Cola
calling and saying they want to put you on the back
of the bottle”.
At the moment Google is charging its advertisers a
fixed fee to be included in the print ads. However,
it’s not a massive leap of faith to predict Google
experimenting with auctioning off space or setting
rates based on the number of responses to an ad.
Print ads have traditionally been based on a fee per
1,000 readers. However Google executives have said in
the past that they expect traditional media to
ultimately emulate the search engine model by using
an auction structure to sell ads. This would not be
welcomed by magazine publishers who fear that
auctions could drive down the price of print
advertising.
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+++ WORD OF MOUTH +++
Yahoo! pushes consumers to searching trusted contacts
A move towards personalisation could spell bad news
for some search firms. The big search engines, led by
Yahoo! are encouraging their users to make more
searches through trusted social networks rather than
on the public web. Yahoo! is pushing its Myweb 2.0
service which enables users to create their own
personal archive by saving favourite pages, search
results and search history. This information can be
shared with friends via email, instant messenger and
RSS. Over time Yahoo! expects consumers to shift away
from searching for travel information and restaurant
reviews via the public web, preferring to search
trusted contacts instead. Both Google and MSN Search
are also investigating more personalised search. This
could impact search engine optimisation and affiliate
marketing businesses because it will eliminate anyone
who gets high rankings on search engines without
having good content.
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+++ ON TOP OF THE WORLD +++
Google and MSN combine mapping and search
The battle is on for the next generation of search.
Consumers can already access an estimated 10 billion
pages of online text - thanks to Google, Yahoo!, MSN
and other search engines but people don’t want a
list, they want an answer. One of the new
applications being tested by MSN and Google is an
internet-based, 3D mapping and search service. The
free test versions of MSN Virtual Earth
(virtualearth.msn.com) and Google Earth
(earth.google.com) enable users to zoom in on their
location and see the actual building in a satellite
photograph as if they were flying a few hundred feet
above. Both services are almost entirely US-focused
at the moment, and other maps around the world are
sketchy. Some of the maps and imagery are also quite
old. MSN Virtual Earth, for example, still shows the
Twin Towers in the World Trade Centre in New York.
But these are quibbles as the new services are still
beta versions. 3D mapping and search is an addictive
consumer application. It’s also crying out to be used
on a mobile device.
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SIGNPOST is published monthly by Internet Search
Management Ltd. The opinions expressed are those of
the Editor and not necessarily those of Internet
Search Management Ltd.
All material Copyright 2005 Internet
Search Management Ltd. All rights reserved.
ENDS
