Online advertising

Bing - Your new verb

[Microsoft] is set to launch an $80 million to $100 million campaign for Bing, the search engine it hopes will help it grab a bigger slice of the online ad market. Abbey Klaasen, Microsoft Aims Big Guns at Google, Asks Consumers to Rethink Search

Microsoft has updated and rebranded LiveSearch with a new name. Bing. According to Ballmer,  they picked the name because it was short, it could be used as a verb and didn’t have negative connotations.

In spite of Ballmer’s good intentions, there’s a lot of buzz about “why THAT name?”

I don’t know….If someone said to me “I don’t know what iguanas eat — let me go Bing it,” I think it would sound ok.  I could see people using Bing as a verb.

I do wonder, though, if Microsoft people working on the engine secretly thought of Kumo (the old code name) as Beta Bing?  And btw, Abbey Klaasen is the only pundit I’ve read who describes the new search engine correctly — it’s a vehicle for generating ad revenue.

Location-based service - SMS text ads coming to a cell phone near you

Google has been teaming up with hardware makers to build cellphones with the Mountain View, Calif., company’s Android software, part of its strategy to accelerate mobile Internet access and generate more revenue by selling mobile ads. Scott Morrison, Mobile Ads Seen Picking Up As New Google Phones Hit Market

Today’s WhatIs.com Word of the Day is location-based service (LBS).  Imagine going shopping at your local big-box grocery chain and as the electronic doors whoosh open, your cell phone dings. Who is it? It’s an SMS text message from the grocery store letting you know what’s on sale (forget those old-timey flyers). Or maybe it’s a text coupon, letting you know that your favorite snack food has a two-for-one offer today.

Even as I speak, one of our local New York chains is working to make this happen.  What’s it going to take?  They’re not sure yet, but one thing’s for sure — it’ll take my co-operation.  You see, location-based services are permission based. I’ll either have to download their new iPhone app or register my GPS-enabled cell phone with their loyalty card program.

Interpublic is one of the world’s largest advertising companies — so like E.F. Hutton of years gone by –  when Interpublic speaks, the publishing industry listens.  And according to a new report released by Magna, (the unit of Interpublic that - among other things - provides research and market intelligence to all of Interpublic’s buying operations) mobile ad spends are expected to grow to $229 million in 2009.  That’s down from their original forecast before the economy tanked, but it’s a number that’s still impressive.

Most interesting to me is what kind of ad Magna says will pay off best:

Text messaging platforms represents the best near-term potential for advertisers who want to use mobile devices to support broad-reaching marketing campaigns.   This contrasts with slower growth rates for other more narrow-reaching types of mobile media (such as mobile search, in-call media, mobile video, mobile coupons and mobile gaming).

Tie that in with what Nick Brien’s been recommending about traditional vs. emerging media and one thing’s pretty clear — if you haven’t already been asked to opt-in for SMS ads on your mobile device, you will be soon.  The grocery store is just the tip of the ice berg — and location-based services have definitely reached their tipping point. Nick Brien, a senior executive at Interpublic, says:

In other words, if companies are cutting advertising budgets, they would be well-advised to take money out of traditional TV commercials, while maintaining funding for web search ads; or they should abandon a newspaper campaign, but keep spending to zip-targeted  text ads to cellphones.

Overheard: Social networking? SHOW ME THE MONEY!

Facebook’s real problem isn’t privacy, it’s monetization. Dave McClure, as quoted in Social-networking sites work to turn users into profits

 In many respects, it is the same query that dogged portal companies in the mid-1990s and search engines in the early ’90s. Some were sold. Some went public. Some went belly up.

The ongoing challenge is to concoct a potion — be it through banner ads, premium subscriptions or licensing agreements — that no one has perfected. Facebook, crown jewel of the field, is valued at $15 billion but barely turns a profit.

Overheard: Microsoft-Yahoo vs. Google-AOL?

This time the rumors were true: Microsoft has made a $44.6 billion, $31 per share bid for Yahoo… Microsoft believes that the tie-up will give the companies needed scale in the online advertising space and is expecting at least $1 billion in synergies for the combined company. Joseph Weisenthal, Microsoft Makes $44.6 Billion Cash And Stock Bid For Yahoo; 62 Percent Premium

This also adds urgency to another possible combo: Google-AOL. Google already owns a five percent stake in AOL and a full acquisition would aid Google on the advertising side as well as with traction and traffic in portal areas it has yet to conquer such as finance and sports.

This has the potential to be the first serious threat Google has had to their online advertising business and the first time the battle cry “antitrust” has been sounded.

Diane Mermigas provides a little background for those of us who may have missed an episode of this particular soap opera. The fact that Microsoft is going into debt for the first time to fund this acquisition illustrates just how important this deal is.