Yahoo Microsoft Search Alliance Good or Bad for Search Marketing?

    March 28, 2011
    Chris Crum

Earlier this week, Microsoft shared some numbers from the Microsoft-Yahoo Search Alliance (search and advertising deal), which saw Bing powering the back-end of Yahoo Search, and the merger of Yahoo Search Marketing and Microsoft adCenter.

“The data showed that from August 2010 to December 2010 Search Market Query Share for Bing rose 7.25%,” wrote Microsoft’s Paul Greenwood. “During this same period Google gained .61%. Impressions for adCenter advertisers was up 4%, clicks up 2%, and costs roughly flat. CPC was consistently below Google.”

We’ve seen some complaints indicating that there are some unhappy campers among Yahoo/Microsoft advertisers since the Search Alliance came into play. In the comments section of our last article on the subject, for example, one reader wrote:

I’ll also add that my company, as a partner of Yahoo’s, now Bing’s partner by default, a partner that has sent a lot of high quality traffic for almost seven years now, has been treated like dog dirt in terms of Bing’s new payout. Once the switch from Yahoo to Bing was complete Microsoft sucked the money, also known as a clawback, from their partners. What once was a .50 cent click payout is now a .12 cent click payout, for example. This is what partners like me are seeing.

If they expect to form great relationships with their partners they are doing a poor job of it as every traffic provider to Bing now is bitching about the absurdly low, crap payments we are now getting.

I left Bing just yesterday and did a deal with Google. You can bite it Bing……. until you respect your partners more.

We’d like to hear about your experiences as an advertiser with Yahoo/Microsoft since the Search Alliance. Have they been positive or negative? Tell us about it in the comments.

Microsoft has now posted the following bullet points from a Search Engine Strategies NY session led by Dr. Niraj Shah on the Microsoft Advertising Blog:

Stats of Paid Search Performance Relative to Google

– CTR was roughly equivalent to Google but declined from November
– CPC was consistency below Google; trending downward trend post-transition

Stats Search Conversion Rate and CPA

– Conversion rates dipped during transition but ended 2010 13% higher
– Cost per action (CPA) increased during transition but finished 17% lower

How do we wrap this up? Where do advertisers go with this information?

– Early movers can gain an edge.
– Instead of now having to manage across three engines you can narrow down. – Saving time and becoming more efficient.
– Favorable CPC’s and cheaper clicks and conversions.
– Improved reach and volume drivers greater consistency and manageability
– Favorable CPC and conversion environment (for now)
– Strong performance characteristics imply a higher ROAS than before

Best practices for search alliance success

– Identify coverage gaps between Microsoft Advertising adCenter and Adwords
– Pay attention to geo-targeting and match type settings when transitioning campaigns
– Bid adCenter keywords at the Match-type Level
– Adjust budgets to account for increased volumes
– Set alerts to identify and expand high performing terms

Bing Director Stefan Weitz said, “Because we’re actually powering Yahoo, and not necessarily being Yahoo, Yahoo has the ability (and are doing a great job) innovating on the front-end user experience. So they take our great core results, and on top they can apply their secret sauce…For consumers, what it gives them, is two really different experiences, and depending on which one you like for a particular query, you get to have those experiences. It’s great for consumers.”

As far as Yahoo’s front-end, the search engine launched a new feature this week called Search Direct, which appears to be Yahoo’s response to Google Instant, though there are some differences. This does in fact show that Yahoo is still focused on bringing its own front-end flavor to search, and not just becoming a needless version of Bing. Yahoo still has some things going for it that Google and Bing don’t in its original content that it isn’t shy about pushing into its search experience.


Chris Crum
Chris Crum has been a part of the WebProNews team and the iEntry Network of B2B Publications since 2003. Follow Chris on Twitter, on StumbleUpon, on Pinterest and/or on Google: +Chris Crum.