And Now, a Pay-to-Play Search Directory

  |  February 24, 1998   |  Comments

Idealab!, an Internet business incubator, announced the launch of GoTo.com, a search directory that enables Websites to purchase placement within search results using a real-time competitive bidding process.

Idealab!, an Internet business incubator, announced the launch of GoTo.com, a search directory that enables Web sites to purchase placement within search results using a real-time competitive bidding process.

This new search directory removes the clutter and confusion of Internet searches by enabling consumers to find what they're looking for faster, and Web sites to reach targeted consumers in the most efficient way, the company said.

Charter advertisers include iVillage.com: The Women's Network, Gamespot, OnSale, Speedware, StoneAge, Mediaflex, GreenPageSports, GoldenPalace, GoRacing, @backup, Total Sports Network, Sportszone, ABCnews.com, Mr. Showbiz, NFL.com, NBA.com, Nascar Online, CBS Sportsline, The Mining Company, Z-Auction, Infohiway, Deal-Deal, Rick Dees Online, CitySearch, Tickets.com, Shopping.com, eToys, and WeddingChannel.

Idealab! Chairman Bill Gross named Jeffrey Brewer as chief executive officer of GoTo. Brewer has been in the online industry for five years, first as manager of the online applications group at Knowledge Adventure, then as a co-founder of CitySearch.

Until now, search engines have either used impersonal database search algorithms to blindly rank Web pages according to keyword density or relied on the manual efforts of limited editorial staffs to review every page on the Web. "GoTo introduces the simple approach of empowering the marketplace to determine the ranking and relevance of search results," Brewer said.

Using a proprietary open-auction system, GoTo posts the per-word pricing so that Web sites can bid for higher placement within a list of search results for any given topic. At the same time, consumers are given to understand that placement on the list reflects a Web site's desire to reach them, similar to advertisers in a yellow pages directory.

This process means the interplay between consumers and advertisers will determine the value of a given click-through. Web sites will pay only for actual visits to their sites instead of for exposures, the company said.

"The GoTo model recognizes the dramatic shift that has taken place on the Internet since its inception. No longer an egalitarian playground for the tech-savvy community, it has become the focus of corporations and commerce and invaded by the masses," said Gross.

"This turns the whole advertising paradigm on its head. This completely upsets the apple-cart, but the reason it's going to work is that it provides greater efficiency for the advertiser and for the user as well," Arthur Einstein, marketing consultant and founder of Lord, Federico, Einstein and Geller, was quoted as saying.

Pasadena, CA-based GoTo features a simple organizational structure. The GoTo home page features a GoTo search bar and five category buttons: people, places, products, hobbies, and searches. People can just type in what they're looking for, or view the hottest searches in each of those five categories.

Idealab! reports it has more than 20 businesses in various stages of development, employing more than 1,000 people worldwide. Other Idealab! companies include CitySearch, tickets.com, and IntraNetics.

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