Why the Search Engine Wars Are Good for Advertisers

I knew it was going to happen and it did, last Sunday night. I sat on my sofa, watching one of the few television shows I bother dedicating my time to, “Extreme Home Makeover.” Then I saw it: a TV spot for the new MSN Search.

I yelped with gleeful self-righteousness. Only a few days earlier, I’d been telling a client the new search engine wars, a fight for consumer mindshare and use, won’t be waged at the search engine Web sites, but with very public marketing campaigns. Bill Gates already conceded he missed the boat in the early days of search and underestimated Google. Something tells me Bill Gates doesn’t like to lose.

Sure enough, here was a juicy, expensive TV spot to support my case. Crafted to look a lot like an Apple iPod spot (I was confused at first), the message is MSN Search is the cool place to find what you’re looking for. Whether this particular message really helps build use of MSN Search remains to be seen. If it’s smart, MSN will tinker with several different messages.

The search engine wars will have big ramifications on the Big Three: Google, Yahoo, and MSN. In catch-up mode, Yahoo and MSN have already demonstrated their willingness to spend more on advertising and marketing. Online advertising is the obvious place for them to budget their dollars but expect to see more television, print, and outdoor advertising, as well as sponsorships, event marketing, and ad specialty items. (Anyone willing to venture a guess at how the Big Three will ratchet up their efforts at Search Engine Strategies in New York this week?)

Google, which has never advertised to consumers, nevertheless continues to seize mindshare and spread the brand with a plethora of new products and services, including toolbars, a desktop search module, and specialty searches, such as the just-launched film reviews. Google has mastered the art of buzz, leveraging its dominance with each new product release. Every release makes news and piques consumer curiosity; users flock to check out the latest and greatest. All this leads to brand reinforcement and (Google hopes) consumer loyalty. If this isn’t a calculated marketing strategy, I don’t know what is.

Let’s not forget AOL Search, either. Even though AOL is partnered with Google to syndicate Google’s top advertisers to AOL’s SERPs (define), AOL still sold its own keyword advertising. AOL put a moratorium on selling any new keyword search buys in January as it figures out a new, yet-to-be-announced ad model. AOL Search isn’t a force to be reckoned like the Big Three, but when AOL rolls out its new ad model, it too will likely throw additional marketing dollars behind AOL Search.

The fight for search engine supremacy will likely be won by the users’ experience, not marketing campaigns. As a media buyer of search engine placements, I say, “Let ’em go at it!” The more money Yahoo, Google, and MSN pour into marketing and product development in this all-important war, the more my advertisers increase their chances of exposure across the board.

This is a pretty persuasive argument to use with advertisers who’ve been on the fence about giving search advertising a try. “Get in while the it’s good, because it won’t be like this forever,” I tell them.

Of course, there’s a flip side. Advertisers already in the game may face additional pressure to stay in. With the bid-for-placements offered by Google and Yahoo (via Overture), an influx of new advertisers hoping to capitalize on the search engine wars may mean higher per-click prices.

Then, there’s the issue of limited search inventory to buy. Limits may not support the extent to which all advertisers want to play. Yet the search engines are busy making acquisitions and developing products to create new advertising opportunities to help address this problem and take advantage of advertiser growth. Local search, shopping search, and buys such as Ask Jeeves’ snapping up Bloglines are just a few examples. I encourage them to do so. I’d like nothing more than to test out new search advertising opportunities with our clients. Bring it on.

Online advertising is already experiencing a resurgence. Will advertisers benefit from more traffic in the short run but face higher prices in the long term from the search engine wars? I’m not going to wait to find out. I’m buying heavy now.

Speaking of online advertising, if you buy media, please take this short survey I’m conducting to collect data for an upcoming column. Thanks!

Meet Hollis at Search Engine Strategies in New York City, February 28-March 3.

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