The launch of Cuil, a search engine start-up developed by a group of former Google executives, sent tremors through the paid-search sector when it was unveiled at the end of July. With Google commanding over three-quarters of all UK searches, advertisers and agencies are growing increasingly desperate to see the internet giant's dominance of the sector challenged.
Little was known about Cuil's proposition before its launch. The fact that journalists and bloggers were banned from testing the fledgling search engine served only to heighten the anticipation. However, when Cuil was finally unveiled, anticipation quickly gave way to anti-climax when advertisers realised it may not be the 'Google killer' they had all hoped for.
This sense of disappointment reverberated through the search sector, which is still smarting over Microsoft's failed $45.5 billion (£23.9bn) bid for Yahoo! months after the software company walked away from the negotiating table. Many considered Microsoft a white knight that would offer much-needed competition in the market.
Despite the air of dissatisfaction surrounding Cuil's launch, many were impressed by the search engine's layout, design and algorithm, which place greater emphasis on relevancy than many of its rivals (see box, p33). This brave new underdog, which is backed by deep pockets, may yet become David to Google's Goliath, but for now it seems that the most likely challenge to Google's dominance will come from rival search giants MSN and Yahoo!.
Google's vice-like grip on the UK paid-search sector is only getting tighter, while its main competitors struggle to increase their share of search queries. Google's share of total UK searches rose by 1.8 per cent in the first half of the year to 75.3 per cent, according to comScore. Its position has been strengthened further by its main rivals' declines. Yahoo!'s share dropped from 4.4 to 4.3 per cent over the same period, while Microsoft fell even further from 3.8 to 3.4 per cent. Meanwhile, Ask.com saw its share fall from 2.7 to 2.4 per cent.
In terms of worldwide searches, Google is ahead of the pack, but its position does not mirror the near-monopoly it has in the UK. In the first six months of the year, comScore figures show that Google's share of worldwide searches went up by 0.6 per cent to 63.7 per cent. Yahoo! suffered a 0.6 per cent drop to 11.6 per cent, while Microsoft's share remained unchanged at 3.1 per cent. Ask also held steady at 1.2 per cent.
So what have Google's rivals got in the pipeline to reinvigorate their challenge? Microsoft has long trailed behind Google in terms of paid search, but experts believe its wealth and determination, demonstrated by its protracted pursuit of Yahoo!, make it the most likely contender. To put it simply, Microsoft's search marketing proposition is built around adCenter, a central hub that offers advertisers targeted tools across all of the company's assets from MSN and Hotmail to its Xbox games console and its main search engine LiveSearch, which has received significant financial investment in the past 12 months.
AdCenter celebrated its third birthday in August, and, following an inauspicious start, has begun to find its feet. As well as benefiting from improvements made to LiveSearch, which now claims to be answering search queries with higher-quality results, adCenter itself has evolved significantly in the last year.
"We've continued to add new features," says Mel Carson, Microsoft adCenter community manager. "We've got more releases in the pipeline such as the Add-in for Excel tool, which will be the mother of all keyword research tools."
Microsoft's Add-in for Excel is a keyword research and optimisation tool that allows marketers to expand keyword lists, based on a host of factors. The idea is to gain greater reach for advertisers. "We did some research and found that 95 per cent of search marketers use Excel," adds Carson. "You can type in a few keywords and it will spew out data on demographics, monetisation and lots of other useful chunks of information."
The launch is part of a wider range of improvements to adCenter that leverage Microsoft's portfolio of products. Microsoft is piloting adCenter Desktop, a campaign-management tool aimed at helping marketers manage their paid-search activity more efficiently. "We understand that although advertisers get a great return on investment through adCenter, it's also got to be a good investment in terms of time," Carson says. "There's no point in spending 15 per cent of your time on adCenter if you're only spending 5 per cent of your budget with Microsoft."
With Google spending an increasing amount of time and energy wooing big-spending brands, Microsoft is also focusing its efforts on catering for advertisers of all sizes. "We're working furiously behind the scenes so that smaller business that don't have the budget for pay-per-click can check that their websites are being indexed by LiveSearch via free webmaster tools," Carson boasts.
Looking ahead, Microsoft has a free analytics product in the pipeline and a few more "bells and whistles" to come. For the moment, however, its suite of products and services will not include Yahoo!'s armoury after the collapse of their proposed merger earlier this summer. Yahoo! has instead chosen to pursue a partnership with Google that will see the ailing company plug into the search giant's advertising technology. Jeffrey Revoy, Yahoo! Europe's vice-president of search and social media, denies that the drawn-out flirtation with Microsoft has distracted the corporation from focusing on its core search offering. "I feel positive about the direction of the company and believe we are delivering from a search perspective," he says.
In the past six months, Yahoo! has rolled out two major releases based on open-source technology that are aimed at opening up its search platform to developers and third parties. In May, Yahoo! launched SearchMonkey, a free-to-use developer tool designed to give website owners more choice about the information they want to show. The application, which takes less than 10 minutes to create, enables the display of visibly different and enhanced search listings by allowing publishers to control the content of their listings, incorporate images and embed live links.
Similarly, Yahoo! followed SearchMonkey with Search Boss to give third parties unprecedented access to its search technology, including the ability to re-rank and control the presentation of search results.
"The web is getting bigger, and people are finding that they need to do lots of multiple searches," says Revoy. "We've launched a series of products that are part of a broader continuation and we will continue to evolve our interfacing. It's about core relevance and bringing a unique experience to the user."
Yahoo!'s open strategy has been met with widespread approval from agencies. "I'm really interested in Yahoo!'s open strategy," says Jenny Kirby, a senior search director at i-level. "I think it's a really bold move to say 'Here's our search technology - go forth and create something from it'. It's quite true to the spirit of the internet."
Microsoft and Yahoo! have both taken a more entrepreneurial approach to search, but many believe they still lack the critical mass needed to give Google a real run for its money.
Chris Simpson, interim managing director of The Search Works, says: "Microsoft has made some big strides in terms of its algorithms, but for me the issue is not having the volume. Ultimately, you can get some decent returns out of the other search engines but you're not getting the volume. With marketers squeezing the budget, the peripheral search engines are the first ones to go."
It's a similar story at Ask.com, which has disappeared off the radar following a major consumer marketing push in May 2007 called Information Revolution. However, Ask.com recently acquired Lexico Publishing Group, the owner of a slew of popular search-based websites including Dictionary.com in an effort to bolster its position. "At Ask we are looking to grow our traffic and brand awareness in the US and Europe," says Cesar Mascaraque, the company's European managing director. "We expect the business of online search to enter a terrifically dynamic phase in the next 12 months, as people look beyond a one-size-fits-all solution to search."
Some remain convinced that the imbalance in the UK search market will be redressed by the arrival of young start-up search engines. As well as Cuil, a number of new players have also entered the search sector. SpaceTime 1.0 launched a three-dimensional web browser in January, allowing users to shuffle through different search results without having to switch between web pages. Meanwhile, Mahalo is attempting to break new ground by providing human-edited search results aimed at trumping those produced by an algorithm. In addition, Spock.com is a people search engine that pulls together data from dozens of different websites to automatically form personal profiles of individuals.
Jamie Walters, head of digital at the UK's Metro newspaper, says the growth of smaller search engines has had little impact on his search strategy. "Google completely dominates the market. You just can't get the same exposure and return on investment from smaller sites," he says. But Walters notes that Google's restrictions mean advertisers cannot buy certain search terms, such as those associated with gambling, which means the search giant does not dominate this area of the market. For the limited amount of search activity Metro carries out to promote its bingo activity, it chooses Yahoo! and Ask. "There is little outside of Google," Walters adds. "While emerging sites such as Cuil.com may get media coverage, until they gain critical mass they won't affect our marketing strategy."
It appears for now that Google has the UK search market sewn up, unless it implodes under the weight of its own enterprise as it extends itself into new areas such as display advertising and affiliate marketing.
EXTEND YOUR PAID SEARCH CAMPAIGNS
It's not all about Google. There are other search engines from whom advertisers can buy PPC profitably and efficiently.
- Bids are often cheaper on Yahoo! and MSN Live Search. If budgets are limited, you can probably still afford to be in top position on these engines.
- Google may have scrapped agency discounts, but Yahoo! offers 10 per cent, and MSN Live Search is in line with the rest of the market with a full 15 per cent agency discount.
- As Google's dominance grows, many advertisers opt out of using other engines to save resources. This means that there is less competition for clicks on Yahoo! and MSN Live Search.
- There are other PPC models: Yahoo! Search Submit Pro (SSP) allows you to insert listings into the natural search results, paid for on a per-click basis.
- MSN Live Search offers research and segmentation tools, plus a 'bid boost' technology that lets you pay more for clicks coming from the right audience for you.
- MSN Live Search has a stronger female bias than Google (Source: Hitwise).
- Everyclick donates to charity every time a user clicks on an ad. Volumes are small, but the audience is very niche.
IS CUIL A GOOGLE KILLER?
Methodology
Cuil's USPs are that it will be able to index the whole internet and that it doesn't use popularity to rank results as Google does. Instead, Cuil ranks results based on on-page content. This methodology tends to punish sites such as Wikipedia - try searching for Henry VIII and you'll see what I mean.
Quality of results
This is seriously flawed. International and local results appear to be randomly mixed together. A search for the word 'property' fails to return a result for the UK's leading property site, Rightmove, and includes several international sites.
Functionality
The site has a nice look and feel but does it do anything significantly different to the majors or other start-ups? Results are displayed in columns and feature images. The columns are certainly different to most search engine page layouts, but I'm not convinced that the image display is as innovative or attractive as Ask.com's 'binoculars' feature. The clustering of results is also old news, having already been done by Clusty, Ask.com and other sites. The use of tabs is just another form of segmenting results. The relevancy is good but will this really change the way users search?
The verdict
My argument has always been that for Google's position to be threatened, a search engine must fundamentally improve and change the way we search. Cuil has some great features and heavy backing but I don't believe it can achieve those two goals in its current guise.