Microsoft drops Pay Per Click - goes right to pay per performance
May 22, 2008
This will stop click fraud dead cold. The model will keep advertisers happy.. million visitors and not a penny allocated unless someone buys something… this is pretty interesting.. The chances are slim to none that Google will follow suit… mostly because Google doesn’t need to.
Microsoft won’t make a penny from this..
Microsoft (NSDQ: MSFT) unveiled plans Wednesday to entice advertisers and users of its search engine with cash-back savings on online purchases, launching a site called Live Search cashback.
The new site is ostensibly a product search site, but any of the products found by using Live Search cashback can be bought for a certain percentage off even the cheapest price that comes up from a variety of stores participating in the promotion. Advertisers, meanwhile, will only pay per purchase,
not per click.
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Let’s say that MSN increases traffic by 50% so that they are now about 10-12% of searches. And you get advertisers pulling money from Google and Yahoo to put into this program that provides a better ROI. If Home Depot and others start seeing a decrease in spending but the same amount of purchases, do you really think Google will stand idly by? I am talking two years from now though, at least.
[...] it’s that it seems that cost-per-action ads are hard to implement and monetize. Also, as the Tribble Ad Agency so succinctly puts it: The chances are slim to none that Google will follow suit… mostly because Google doesn’t need [...]
[...] Microsoft drops Pay Per Click - goes right to pay per performance- Microsoft (NSDQ: MSFT) unveiled plans Wednesday to entice advertisers and users of its search engine with cash-back savings on online purchases, launching a site called Live Search cashback. The new site is ostensibly a product search … [...]
I suspect this move is an act of desperation by Microsoft (see http://www.siliconstrat.com/blog/2008/05/27/microsoft-cashback-search/) The system is fragile and violates the basic set of needs of users looking for products via search. Without adding value for users, Microsoft is missing the core of the market.
It is basically a reverse variation of iWon, and we all know what a winner that wasn’t.