Microsoft's Bing Gets 'Stickier,' Grabs More Local Dollars

But Will It Keep Gains When Its $100 Million Campaign Stops Running?

By Published on .

NEW YORK (AdAge.com) -- Bing has a long way to go to catch Google, but six months after the site's launch, the numbers show it's heading in the right direction. The question is: Will its gains last once the ubiquitous, $100 million TV and web advertising stops?

Microsoft's search share was up to 9.9%, a record high, in October, according to ComScore. However, Google's market share has also never been higher, at 65.4% in the U.S. that month. And both stole from Yahoo, whose share slid to 18%, from 20% last year. Yahoo's slide means it and Microsoft combined still have less than 30% share, a figure that doesn't bode well as they plan to merge their search businesses -- with Bing powering Yahoo search -- over the next two years.

One area of gain
Yet, there is one area in which Microsoft has been able to grow its share as well as nick a bit of Google's, and that's local advertising.

In the third quarter, Google's share of local search-advertising spending dropped by 5% as Bing and Yahoo grabbed spending, according to a report from WebVisible.

The report looks at spending among the local advertisers running through WebVisible's system. WebVisible is an enterprise-level technology provider that companies such as AT&T and The New York Times use to sell marketing services to local merchants.

Fueling Bing, in particular, were higher click-through rates by consumers and lower costs per click incurred by the advertiser, by as much as 30% in some verticals. In search, marketers track their advertising performance not just by the click but by whether that click converted, or resulted in the desired action, be it an e-mail sign-up, a sales lead or a purchase.

"It's not Google is lessening its performance, it's that Yahoo and Bing have increased their performance capabilities," said Kirsten Mangers, CEO of WebVisible. "Advertising follows audience and spend follows results. We're simply following the results."

And indeed, Google's dominance is hard to ignore. In the third quarter, Google still had 60.4% of all local search spending. Yahoo accounted for 26.2%, Bing for 10.5% and Ask for 2.4%. And not every local search provider saw the same movement. Clickable, another provider of campaign-management technology for small- and medium-size businesses, said Google's share held steady at around 80%.

Size matters
In a way, Bing's size is one of the things working for it as it steals share. Ms. Mangers pointed out that Bing's advertiser base is not yet as highly populated as Google's, so there's less competition among the merchant base, which helps drive higher click-through for individual advertisers.

When Microsoft relaunched Live Search as Bing, it noted it would concentrate on four categories: travel, shopping and products, health and local. And while it appears the concentration in the local space is starting to pay off, there's a much larger opportunity in the future if it can figure out how to more effectively work with local marketers.

"There are 45 million small businesses around the world and not any one player has achieved a 0.05% penetration rate against that number," Ms. Mangers said. "We all need to find ways to better engage the local marketplace."

More broadly, it's tough to know how share gains for Bing are directly related to sampling created by the media blitz, or if search habits are substantially starting to change.

"You can spend marketing dollars to stimulate trial," said Kevin Lee, CEO of search-marketing firm Didit. "For me, what I watch is stickiness -- did people try Bing and do they like it?"

One sign would be any increase in the number of queries per user, which would indicate they liked Bing once they tried it, or perhaps that Bing had become a solid second choice for those unsatisfied from whatever they got from a Google query.

As one might expect with the beginning of a $100 million media blitz, unique searches across Microsoft properties jumped in June; over time, the number of repeat searches has steadily inched up as well. In October, Bing searchers averaged 16.1 queries a month, up 13% since June, according to ComScore.

It's not a game-changing increase, considering Google users perform an average of 54 searches each month, but Microsoft can take some heart that the numbers are moving -- albeit slowly -- in the right direction.

~ ~ ~
Abbey Klaassen contributed to this report.

In this article:

Comments (1)