Marketers broadly assume that their paid search ads will do better on Google than on Yahoo, MSN, or any other search engine.
The MediaPost coverage of research firm Outsell’s study on search advertising should set off the klaxons in Yahoo HQ and the Microsoft campus. It is not just the greater perception that an ad on Google will out-perform one placed on any other site, but where that perception rests.
In the study, distributed during a recent conference in New York, Outsell noted that there was more to the numbers than the 71 percent approval rating respondents gave Google, versus 62 percent for Yahoo and 49 percent for Microsoft:
…when Outsell looked more closely at the results, it found that the most enthusiastic Google fans also had the smallest marketing budgets. The average marketing budget of respondents who rated Google “extremely” effective totaled $3.7 million. But average budgets for those who considered Yahoo and MSN extremely effective came to $4.6 million.
That presents an interesting scenario for MSN and Yahoo. Impressing big multi-national companies to advertise with them looks good in the quarterly reports. But success may come from the same concept that made Wal-Mart the global retail leader – volume.
There are many more small budget advertisers than big budget ones. Yahoo has to convince them its work on improving relevance in Yahoo Search Marketing through 2006 made the service better, and MSN has the same issue to confront when adCenter launches this summer.
Google has a loyal advertising following, and it is all based on relevance in search. Right now, despite the market gyrations following its latest earnings announcement, Google’s advantage in relevance has not changed. It’s up to MSN and Yahoo to convince advertisers it can match Google, and they will have to compete on price as well.
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David Utter is a staff writer for Murdok covering technology and business.
