Microsoft Yahoo tie-up promises better conversions

Microsoft and Yahoo has claimed its joint search “alliance” will offer advertisers greater return on their spend when they merge in the UK next year.

The merger in the UK is currently in the planning stage with transition from the current two platforms scheduled to start early next year in Europe where the UK will be first along with France and Ireland.

Cedric Chambaz, marketing manager at Microsoft Advertising, gave delegates an update on the merger at this week’s Tradedoubler Summit in London.

He said research had shown that advertisers were not planning to reign back on their spend but that they were looking for a greater return on investment.

“There has been a dramatic shift in the way people are using search. They are not investing in search at all costs. They do not want to drive traffic to their sites that’s just bouncing back. They want people who purchase.”

Chambaz claimed Bing and Yahoo were 33% more likely to convert than customers coming from other search engines, including market leader Google.

Although he admitted Google has market share with around 70% of all searches, he said working together Microsoft and Yahoo believe they can drive more value to advertisers.

West Burghardt, Yahoo EMEA programme manager, said: “We are bringing these two sources of traffic together and we are going to create more value in the marketplace. We want to bring best in breed to the marketplace.”

Under the terms of the alliance Microsoft will run all paid search campaigns through its AdCentre meaning advertisers will no longer use Yahoo’s Panama system. Yahoo will manage all premium advertisers, while Microsoft will look after the smaller advertisers.

Organic results on Yahoo will be powered by Microsoft but the two search engines will continues to compete in terms of how search results are displayed.

Burghardt said: “We are still competing. Outside of the search world everything stays pretty much the same as it is today.”

Advertisers in the US and Canada are currently going through the transition process and Microsoft and Yahoo have vowed to work closely with UK partners to ensure the change over goes smoothly.

The combined search engines claim to have a 10% share in the UK and said once the merger is complete it will have a 15% worldwide share of search traffic.

Chambaz said he expected Cost Per Click rates to remain “significantly lower” than for Google’s Adwords although he said he could predict how CPC might be affected by the merger.

“We want to make sure we are working with advertisers on this and understand what’s going to happen to the marketplace.”

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