Wednesday 15 July 2009

Bing - fewer ads means more kerching!

Bing has reduced the number of ads it shows on its first page of results, apparently in an attempt to increase relevance to keyword.

AdGooroo has counted the average number of ads per keyword for Google, Yahoo! and Bing. While the other two are showing five to six ads, Bing is down to three and has markedly more relevant results. Revolution says:
AdGooroo conducted a number of tests on keywords including ‘Hawaii' on all three search engines. Google and Yahoo! returned results that were ‘rather far afield', while Bing delivered three ‘highly relevant' ads for Hawaii helicopter tours, Hawaii holiday rentals and Hawaiian tour packages.
That the relevance to keyword is greater is no doubt the message that Microsoft wants advertisers to hear about Bing.

This is slightly disingenuous reporting. First, the decline occurred before the rebranding, around October/November 08. Second, if you look at the US & International picture (not just US), Microsoft reduced its ads/keyword to the same level as Yahoo! just at the time when Google significantly increased its number, having been at the same level as Yahoo!. The global picture now is Google 5+ ads/keyword with Yahoo! and Microsoft tracking around 4.

Nevertheless, it reveals two distinct strategies. Google's is to squeeze extra ads on to its 'real estate'. With its huge market share of search, increasing ads/keyword increases revenue.

Microsoft, on the other hand, by reducing supply of ad space on the first page of results, can charge a higher price for the ads. Then, by rebranding, making some valuable albeit relatively straightforward changes, spending lots of money on marketing etc, it increases its share of search and by so doing, increases the value of the first page results to advertisers, increases the number of clicks and also increases the cost per click.