Bing advertisers on wane, says report

'Inexpensive marketing sandbox'

Microsoft's Bing decision engine search engine stomached an 8 per cent drop in all-important first-page advertisers during the third quarter, according to the latest report from search research outfit AdGooRoo.

First-page ads are those that turn up on the first results page after a keyword search.

Due out tomorrow - prior to the release of quarterly earnings results from Google, Yahoo!, and Microsoft - the report also says that's Google share of search advertisers has reached a near all-time high of 81.2 per cent. All this, and we're just 18 weeks away from Bing's much-hyped debut.

According to AdGooRoo - a search marketing consultant that tracks search ads from a network of servers across the globe - Bing delivers better conversion rates than Google (as does Yahoo!). And you could argue that Bing is the better organic search engine. But Google provides the reach - and that's what advertisers prefer.

"Google has become the premium supplier of high-volume search traffic," AdGooRoo's Q3 reports reads. "Despite having lower conversion rates on whole than either Yahoo! or Bing, it drives far higher volume and a very respectable ROI, making it an excellent choice for established brand advertisers."

In other words, it repeats the obvious.

And this is why Microsoft and Yahoo! are so keen on tying the search knot. The two finally signed a long-awaited search deal in July, but it still requires approval from regulators.

"Classical marketing strategy suggests that this is a reasonable equilibrium point for a mature market," the AdGooRoo report continues. "Google is unlikely to lose their lead, while Bing will need to spend exorbitant sums to gain (or even maintain) market share, a precarious situation at best. In this light, a Bing-Yahoo! partnership is a sound decision."

Whereas Google controls 81.2 per cent of search advertisers, Microsoft and Yahoo! are limited to 12.8 per cent and 26.0 per cent, respectively (some, of course, advertise on more than one). And whereas Google continued to pick up big-name brand advertisers during the quarter, Bing's biggest additions were comparison shopping engines from the likes of Nextag, k8yel.com, bestcompare.net, shopwhiz.net, and underpay.biz. "Many of the top advertisers appear to be rebranded variations of the same site, suggesting that Bing is being used as an inexpensive marketing sandbox."

AdGooRoo's report also indicates that the number of ads Google shows per keyword continues to climb - as it has done throughout the economic meltdown of the past year. When Google announces its Q3 numbers on Thursday, you can expect the usual epic sums of ad cash. ®