A white flag of surrender was seen over Yahoo’s once titanic fortress last year as they announced that their advertising would be handled by competitor Microsoft. Shortly thereafter, Yahoo handed the reigns over completely, letting Bing handle their search engine algorithm so Yahoo could focus on other projects. The move was marked with skepticism from all parties, and Yahoo’s mass layoffs since have done nothing to help. However, a recent report from Marin Software indicates that the move has helped both companies.
The study examined the search share for both paid click and search advertising impressions, and while there were very few “losers” to be seen, Yahoo and Bing certainly weren’t floundering. The total search impressions for Bingahoo increased by 4% (from 19% up to 23%), their paid search click increased by 2% (from 19% up to 21%), and their total ad spend increased by a full 44%.
However, it’s not just Bing and Yahoo that are seeing an increase. While Google’s figures for impressions and paid search have declined slightly, the company’s total ad spend increased by approximately 60%. If both companies are growing, what exactly does that mean?
The old search model looked something like this: Low-end advertisers had to choose which group to advertise with, and inevitably chose Google; high-end advertisers could choose multiple, but often avoided Bing and Yahoo because they were fairly small networks, and the effort for return was often insufficient. In the post-merger model, it’s not the first portion of the equation that has changed, but the second. Since advertisers can now reach a broader market more easily, there’s a definite incentive to advertise on the platform. Even low-end advertisers may be swayed by the new advertising pitch. This means that there’s a lot more reason to advertise on Bingahoo and Google. The conclusion, then, is that Google isn’t falling — Bing and Yahoo are simply rising up.
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