LookSmart Enters Paid Listings Fray

  |  October 2, 2003   |  Comments

The paid inclusion company offers keyword search as an alternative to Google and Overture. Now, building the distribution network.

LookSmart on Thursday took aim at search industry heavyweights Google and Overture Services with the introduction of a rival keyword listings product.

The company's Sponsored Listings, however, will have limited distribution compared to Google's and Overture's. For now, the listings will appear on CNET, Road Runner and Cox Internet, as well as metasearch engines like Mama.

LookSmart hopes to win major distribution from portals looking for a paid search provider that is not a competitive threat, with MSN being the key prize. Overture currently supplies the paid search for Microsoft's portal, but the future of that relationship is up in the air since the search player agreed to be acquired by MSN rival Yahoo.

"Our goal is to go after the higher-quality distribution," said Dakota Sullivan, LookSmart's vice president of marketing." There are only three companies with the capacity to serve the major distribution partners. Two of those, Google and Overture, already have their own agendas."

The argument is a carbon copy to the one Overture made against Google, until it inked the deal to be acquired. While Overture is committed to maintaining the MSN deal, it expires in December 2004. Meanwhile, MSN is investing heavily in search, although for now it says it has confined its efforts to the algorithmic side.

"I think key to [Sponsored Listings'] success will be whether Microsoft would adopt it and whether they'd replace Overture with it," said Fredrick Marckini, chief executive of search marketing firm iProspect, which is a reseller for LookSmart, Overture and Google. "I don't think Microsoft is pleased with giving money to a competitor."

LookSmart and MSN have long had a close partnership -- perhaps too close. Last quarter, Microsoft accounted for about two thirds of LookSmart's revenues from carrying its paid inclusion listings. This has left LookSmart in a similar position to Overture prior to the Yahoo deal, only LookSmart is reliant on a single partner for a lion's share of its business.

This danger was brought home in August, when LookSmart disclosed that MSN was experimenting with a new way of displaying search results that would eliminate the directory layer of listings provided by LookSmart. The agreement between the two companies remains in limbo, set to expire in two months.

LookSmart said its pay-for-placement keyword advertising system would work along the same lines as Google's, returning keyword ads based on a combination of bid price and click-through rate. Sponsored Listings will have a minimum bid of 15 cents, higher than both Google and Overture.

With more than 30,000 advertisers using its paid inclusion product, LookListings, the company hopes to quickly build a sizeable base of advertisers that will in turn attract big-league distribution partners. LookSmart also offers non-paid search through its WiseNut technology, giving it the ability to offer potential partners three key elements of search.

"It should be relatively easy to move their existing customers over to the [Sponsored Listings]," Marckini said. "This is going to come down to a battle of distribution and who's got the best business development teams."

ClickZ Live New York What's New for 2015?
You spoke, we listened! ClickZ Live New York (Mar 30-Apr 1) is back with a brand new streamlined agenda. Don't miss the latest digital marketing tips, tricks and tools that will make you re-think your strategy and revolutionize your marketing campaigns. Super Saver Rates are available now. Register today!

ABOUT THE AUTHOR

COMMENTSCommenting policy

comments powered by Disqus

ClickZ Today is our #1 newsletter.
Get a daily dose of digital marketing.

COMMENTS

UPCOMING EVENTS

UPCOMING TRAINING

Featured White Papers

Google My Business Listings Demystified

Google My Business Listings Demystified
To help brands control how they appear online, Google has developed a new offering: Google My Business Locations. This whitepaper helps marketers understand how to use this powerful new tool.

5 Ways to Personalize Beyond the Subject Line

5 Ways to Personalize Beyond the Subject Line
82 percent of shoppers say they would buy more items from a brand if the emails they sent were more personalized. This white paper offer five tactics that will personalize your email beyond the subject line and drive real business growth.

WEBINARS

Resources

Jobs

    • Customer Service Consultant
      Customer Service Consultant (Bonner and Partners) - Delray BeachBonner & Partners: Full-time Customer Service Consultant Position Who we are...
    • Financial Editor
      Financial Editor (Confidential) - DurhamSIX FIGURE EDITORS WANTED: To enforce lofty NEW editing standards. Easy Conditions Unlikely. Promotion and...
    • Information Processing Specialist
      Information Processing Specialist (Agora Inc. ) - BaltimoreInformation Processing Specialist – The IP specialist position ensures the successful...