Disruption Tour --- Run To Survive

Google Health Now Live: Could Become a Powerful Portal for Third Parties

We’re nearly halfway through the year, and Google Health has launched nearly on schedule. The highly anticipated health tool is now live and accessible to all Google users. There are four basic categories to utilize: Your personal Health profile, Importing of medical records, Exploring online health services, and Doctor search.

The information you provide under your health records is used for your own personal purposes, and can be printed and taken with you to a doctor’s appointment. If an office is integrated with Google health, then the information is already accessible to them In terms of the extended health services provided through Google’s health portal, registering for any of these, and linking it to your Google health profile provides you with automated updates to that third party service.

The doctor search is quite similar to what you’ll find through a regular Google search, except this is a specialized search tool. There are no filtering options, however, so going through a page of results can b a cumbersome task. Once you find a doctor you like, however, they can be linked to your Google Health profile as well.

With the current offering, the most powerful aspect of Google Health is likely its consumer-facing portal, which a number of third-party services will be interested in having a spot. This appears to be more integrated with third parties than Microsoft’s HealthVault. Even though Google is explicitly not in partnership with these third party services, having a select number of these services is almost acting as a recommendation to the end user.

As there are only a handful of services that can be connected to your Google Health profile, including ePillBox and Walgreen’s Pharmacy, the potential for increased user base and added value of integration with Google Health makes it a potentially covted place for which third-party services are accessed.

The True Fiction of Microsoft Live Search

gigom.com

Yesterday, I read a post on Google’s blog about their focus on improving search quality. Today, I read a press release from Microsoft in which it said its Live Search product will be used to give “cash back” to those who use it to find and buy things. Innovation vs. buying your way into the market…in my book, that kinda speaks for itself.

Microsoft’s “Live Search cashback” site…promises to pay back a portion of the purchase price — ranging from about 2 percent to more than 30 percent — to people who use it to find designated products and buy them online from participating retailers…including the online sites of large retailers such as Barnes & Noble, Sears, Home Depot, J&R Electronics, Office Depot and others. [via]

Instead of jumping to conclusions, I decided to make a list of my thoughts on this, many of which the folks at Microsoft are not going to like.

• We shouldn’t be surprised that Microsoft is using the lure of the cash. When it comes to beating Google in the search game, cash is the one asset it already has.
• Microsoft Chairman Bill Gates is still running the company, despite not being the CEO. He talked about paying people to search almost three years ago.
• eBay is using Microsoft to generate traffic. That leaves lead-generation players on a slippery slope.
• TechCrunch notes that this program is based somewhat on Jellyfish, a company that Microsoft bought back in 2007. In other words, this isn’t a new idea, just new spin.
• Will this work? That remains to be seen. Remember a company called iWON? Well, despite all the cash and prizes it handed out, it failed miserably. Will Microsoft’s size and online presence give it a leg up? Maybe.
• It really doesn’t address the issue of Microsoft continuous loss of market share in search.
• Microsoft will need to find a way to overcome resistance to register for the service.
• Microsoft Live Search Cashback has 200 merchants, compared with the average comparison shopping engines, which each have about 10,000 merchants.
• Microsoft is pretty serious about what amounts to little more than a gimmick. They recently bought Cashback.com, showing how committed Microsoft is to this effort.
• What Microsoft is indicating: It will shift to a cost-per-acquisition model, instead of the more generic cost-per-click model, which I think is actually a good thing.
• What they really need to do is to upsell merchants to other types of online advertising they offer — search, contextual, content and display. Now that could prove to be a very big opportunity

Final thought: Microsoft’s traditional strategy of “We will charge less and crush the competition” really doesn’t cut it anymore. How long do you think merchant partners are going to stick around and waste their resources if they can’t make money? This is not some PC-maker-schmuck they have in a headlock. Take a look at all the other new technologies where Microsoft hasn’t been able to dominate — this is a sad reflection on that trend.

The Empire Strikes Back: Our Analysis Of Microsoft Live Search Cashback

techcrunch.com

Michael Arrington

Everyone has an opinion on today’s move by Microsoft to shake things up in the search space. Their new Live Search Cashback product shifts search advertising from cost-per-click (CPC) to cost-per-action (CPA) and give a lot of the revenue back to users. Most writers are negative. Some excessively so. After hearing Bill Gates give the pitch and trying the service myself to make a couple of purchases, here’s what I think: It’s a bold move that goes for Google’s throat, and it will likely have a material impact on their search market share.

Our complete analysis is below. The key takeaway: Google’s search dominance is growing, and everything Microsoft has historically thrown at them has done nothing to slow them down. This new approach is both desperate and brilliant. Desperate because Microsoft is giving away most of the search revenue to get market share gains. Brilliant because they have such a small share of search revenue today that they have little to lose, and they are hitting Google hard in their core business.

The Numbers

Microsoft had to do something fairly drastic to get back in the search game. They’re third in U.S. search market share with under 9.1% of the total pie. Just six months ago they had 9.8% market share. Google, by contrast, has 61.6% and is growing steadily:

Without search market share, Microsoft can’t get search revenue market share. And it isn’t just a matter of splitting up the pie. This is a winner-take-most market: Having 9% of search doesn’t mean Microsoft has 9% of search marketing dollars. Far from it - publishers go to Google to partner on ads, which means advertisers must go there to get inventory, and a very healthy auction system pushes up prices. So not only does Microsoft (and Yahoo, and everyone else) have much fewer queries than Google, they are also generating much less revenue per query as well.

So how much revenue are we talking about? Today the worldwide online advertising market is somewhere in the $40 billion range, and there are estimates that it will grow to $80 billion by 2010. The search piece of that is big - about 40%. So $16 billion or so today, growing to $33 billion by 2010. Google gets the vast majority of that search revenue today.

Microsoft’s core revenue is derived from Windows and Office, and the future doesn’t look to be very bright for desktop software sales. Google’s revenues, currently at $20 billion a year, could someday surpass Microsoft’s (Microsoft is currently at about $50 billion/year in revenue) if nothing is done to change the game.

Remember how everyone feared Microsoft’s dominance in the OS and Office worlds in the late nineties? That’s Google today in the search advertising space, a much bigger long term market.

How To Disrupt Google

It’s clear that technology alone will not unseat Google as the dominant player in this market. Microsoft already tried that with their AdCenter improvements in 2006; Yahoo tried with Panama last year. Google’s dominance only grew.

That means Microsoft has to do something different than just build new software that improves on the cost per click advertising model. And moving to a CPA model isn’t enough - Google and others are already experimenting with that. So instead, Microsoft is taking the CPA model, which lowers risk to advertisers, and combining it with a straightforward payback mechanism to users.

This only applies to ecommerce related searches for now. But frankly that is all that matters. Only about a third of searches are commerce related, but those searches generate 80% of search revenue. Get the commerce searches and you’ve got the revenue. And here’s another interesting statistic - 68% of online purchases begin at a search engine or shopping comparison site. Only about 30% are from direct navigation to the ecommerce site itself.

Will It Work?

Yes, it will work and it will almost certainly increase Microsoft’s market share in search, particularly in commerce search. The question is, how well will it work?

A year ago Microsoft basically did a trial run of Live Search CashBack with Live Search Club, which lured searchers to Microsoft with offers of prizes to users for using Live Search. Microsoft went from 10.3% to 13.2% market share in a month, a nearly 30% rise. Live Search CashBack, which gives a much more straightforward payout to users, should see significantly better results.

And really, what does Microsoft have to lose? They have a tiny piece of the revenue pie today, pay out money-losing revenue guarantees to partners like Digg and Facebook, and the online division itself is losing a cool $1 billion a year on about $2.4 billion in revenue. This new model isn’t going to give them a lot of profit, but it isn’t a money loser, either. Sometimes, desperation is a good place to be because it forces you to try crazy stuff.

The User Experience

I made two purchases today with Live Search Cashback. Microsoft presents results in a straightforward manner with the price of the item and the rebate clearly shown. After the purchases, the rebate appeared instantly in my CashBack account. No hiccups, great user experience. I came away with a totally different opinion from others.

Google Exec: Hell No We're Not Paying Anyone To Use Google

siliconalleyinsider.com

Dan Frommer |

Not that anyone ever expected Google to chase after Microsoft's (MSFT) new "Cashback" gimmick, but at Goldman's annual Internet conference, Google product director Nicholas Fox didn't beat around the bush:

"No, we have no plans to pay users to use our product," he said. "Our fundamental belief is that we should compete by building a great user experience -- making our users happy by delivering excellent search results and excellent quality. And that's where we're focusing our efforts, rather than paying users nickels and dimes."

Microsoft Offers Rebates to Shoppers Using Its Search

NYTimes.com

y MIGUEL HELFT

Published: May 22, 2008

With its share of the Internet search market in steady decline and its pursuit of an alliance with Yahoo in doubt, Microsoft is taking a new approach to jump-starting its search engine: offering rebates to people who use it to find and buy some products.

Skip to next paragraph

Stephen Brashear/Associated Press

Bill Gates unveiled a rewards program on Wednesday. Microsoft’s share of searches is 9.1 percent, according to comScore.

Microsoft executives said the program, called Live Search cashback, is part of a plan to come up with new approaches to areas of the search business where they see opportunities to make inroads against Google, the market leader.

The new program focuses on searches for products to be bought online, which Microsoft executives said account for roughly a third of search queries and a majority of search advertising revenue.

“This is a very big part of the $20 billion search market,” said the chairman of Microsoft, Bill Gates, at an advertising conference run by the company. “Make no mistake, we are about having the best search, having the best results.”

Some innovations in the business model of search, like Live Search cashback, “will help drive that,” he said.

Live Search cashback is essentially a marketing effort by Microsoft to promote its search service, which lags far behind those of Google and Yahoo in popularity. On Wednesday, the research firm comScore reported that Google’s share of all searches in the United States grew once again in April, to 61.6 percent, from 59.8 percent in March.

Google gained at the expense of Yahoo and Microsoft, which experienced declines in search share, Yahoo to 20.4 percent, Microsoft to 9.1 percent.

Google has put marketing dollars into some of its services, but it has managed to dominate in search while spending virtually no money to promote its search engine. Google declined to comment on the Microsoft announcement.

Microsoft said that 700 merchants offering more than 10 million products have agreed to participate in the program. They include Barnesandnoble.com, Circuit City, eBay, Foot Locker, Home Depot and Hewlett-Packard.

“It is a great opportunity for buyers who come to eBay,” said Matt Ackley, vice president for Internet marketing and advertising at eBay. “And it is all about driving demand for our sellers.”

EBay is one of the largest buyers of search advertisements on Google and other search engines. Mr. Ackley said that if Microsoft’s program was effective, eBay might shift some of its advertising dollars to Microsoft from Google.

In most cases, Microsoft will determine the amount of the rebate that shoppers will get. On a Samsung digital camera that costs $90 to $107, rebates range from 2 percent to 5 percent.

“Microsoft’s issue is lack of consumer share,” said Bryan Wiener, the chief executive of 360i, a digital marketing agency that specializes in Internet search. “This is an interesting effort to try to motivate consumers to use Microsoft without cheapening the process.

“Will the incentives be enough?” he said. “Time will tell.”

As part of the program, Microsoft is also unveiling a new business model that allows search marketers to pay for ads only when people buy a product, rather than when they simply click on an ad.

Microsoft said this so-called cost-per-action model would give advertisers more precise returns on their marketing budgets. Google already offers a program that allows advertisers to tailor their bids on keywords based on the number of actions, or conversions, they get.

Microsoft also said that it had integrated Farecast, a travel Web site that Microsoft acquired in April, into Live Search cashback. The Live Search cashback service was built on technology developed by Jellyfish, a start-up that Microsoft acquired in 2007.

More Articles in Technology »

Whoa: Microsoft Cashback Google-Killer Generates NO Revenue For Microsoft
Here's why Google was down 5% on Wednesday: the merchant partners in Microsoft's cashback progam set the cashback percentage, and Microsoft then passes this entire amount through to the consumer. What does that mean? It means Microsoft generates no revenue from from the service. For perspective, consider the $20 billion of revenue Google currently generates from the other CPC search model, in which merchants pay Google per click and the consumer gets nothing. Is Microsoft planning to run this product at a loss forever just to try to fire a torpedo into Google's hold?

Siliconalleyinsider.com

Is Google Its Own Worst Enemy?

Seekingalpha.com
http://seekingalpha.com/article/77002-is-google-its-own-worst-enemy?source=d_email
Mathew Ingram

There have been lots of “whither Google (GOOG)?” stories in dozens of publications, and no doubt there will be dozens more to come. Some talk about competition from Microsoft (MSFT) on the advertising side, and some talk about how Google hasn’t really had any big hits apart from its ability to coin money on keyword-related search. But Adam Lashinsky’s latest piece for Fortune magazine puts its finger on what I think is one of the biggest issues facing the company: namely, the simple fact that it has become a gigantic entity (and one that is getting more gigantic every day), and it’s hard to be as creative or move as swiftly.

I encourage you to read the whole thing, but a couple of things jumped out at me: one was the fact that Google is hiring on the order of 100 people every week. When Google went public in 2004, it had about 2,000 employees — now it has almost 10 times that many. And with all of those employees, and the billions of dollars that the company brings in every quarter, Google has no doubt developed a bureaucracy of sorts, even if it is a bureaucracy composed of kids in threadless T-shirts riding scooters on their way to the free massage area. This growth has also led to departures, like the ones that Lashinsky describes — including that of Paul Buchheit, one of the developers of Gmail and the co-founder of FriendFeed.com, who is quoted in the article. As he puts it at the end of the piece: “I was always so excited at Google, because I didn’t know what would happen next … then I knew what would happen next.”

That may not mean the imminent death of Google — far from it. But it is still a fact that companies cannot grow at the kind of rate that Google has been growing for very long; and when they do grow at those kinds of rates, they almost inevitably become less fun, less creative, less flexible. It’s almost a law of nature. Microsoft still has Nerf toys and free movie nights and that kind of thing too, but does anyone think it is as creative or flexible as it was a decade ago? I doubt it. Not even Bill Gates would make that claim with a straight face. Google’s biggest enemy now is itself, and its own slowing metabolism.

Are Personalized Mobile Ads Evil? GigOm.com As the mobile browsing experience forces people to search on smaller screens, where will Google place all of its revenue-generating text ads? Ben Kunz in BusinessWeek writes that the rise in mobile browsing on small screens equates to less ad space for Google. I doubt very much it will mean the end of Google’s revenue stream, however. Mobile ads are both scarce and effective and as such, will only prompt Google to attach to them a luxury model. Though such luxury will have to mean more personalization — in other words, as Kunz suggests, more intense profiling and more personalized ads. Given its forays into storing medical data and its ability to search your desktop, I don’t think Google can afford to get too personal with its advertising without risking considerable backlash. But it continues to walk the line between utility and privacy without damaging either its brand or its ability to make money, so maybe Google will find a way.

Do you communicate at the speed of Google? Why you must Posted: 28 Apr 2008 09:08 PM CDT Communication is happening at a faster pace than ever before, but many companies are not adapting their communication strategies/processes to keep up. Search engines are indexing content within minutes, micromedia outlets like Twitter are delivering messages real time and blogging allows mass communication to happen with very few barriers. Rumors and leaks will never go away, but companies now have the tools to be the first to provide key, relevant information. The 15 minute Google rule. Almost without exception within 15 minutes of posting to this blog I receive a Google alert email that there was a new post matching one of my keywords. (Seriously, if you haven't done this yet, do yourself a favor and click here to set them up.) I have "Matt Dickman", "Techno//Marketer", "technomarketer" and "Fleishman-Hillard" alerts set up as well as alerts for competitors and clients. I often get Google alerts for items before they show up in my RSS reader or are floated to me in email. [Update: I posted this entry at 9:43pm and I received my Google alert email that it was indexed at 10:02pm. See screenshot below.]

Google is (still) stalking me

technomarketer.com

A little over a year ago I wrote a post that turned out to be one of my most popular ever. So, to have a bit of fun, I want to revisit that post and see how my relationship with Google has evolved in the past 365+ days.

So come on. Take another trip with me through my day with Google.

	5:15am: Ugh. The day starts to my blaring clock radio. There is an ad running that Google has sold through ClearChannel.
	5:30am: I get up, take a shower and go to the home office to check my Gmail account.
	5:40am: While I am at it I check my Feedburner account to see where my traffic is coming from. Google owns Feedburner now.
	5:45am: Once the email is done I let the dogs outside and turn on the TV. There is a spot running placed by Google.
	7:00am: I start up the car and hear another ad placed by Google.
	7:30am: Driving to work I pass 10-20 ClearChannel billboards. Probably pretty likely Google will place ads on those as well.
	7:45am: I roll into work and sit down. Having stopped at Starbucks in the lobby I open the paper to see what's happening in Cleveland. Again, more ads placed by Google here too.
	8:30am: I jump online, check Google News and my GMail acccount again.
	9:00am: I surf my favorite blogs, most of them have Google AdWords placed on them even in the feeds. I am reading those feeds with Google Reader.
	9:45am: I check my copy of AdAge and see a couple more ads placed by Google.
	10:00am: Finally! I am free from...damn...it's another Google SMS alert on my phone. No peace.
	10:10am: I go to buy an item that I found in a Google search and purchase it with Google Checkout.
	10:30am: I continue writing a client brief in Google Docs (formerly Writely).
	11:00am: Head to the kitchen and see a couple of ads running on TV through the Dish Network which Google placed.
	12:00pm: I'm heading to lunch now, but I can't find that new trendy sandwich shop. I ask Goog411 and get the address and phone number.
	12:15pm: I take a stroll through YouTube to see what videos are hot and why they may be gaining traction.
	1:15pm: I am back at the office now and my phone vibrates again. I have new Gmail. I check it and respond from my phone.
	1:30pm: I am going to a meeting after work and I don't have the address yet. I turn to Google Maps and send the directions to my phone for easy access in the car.
	2:30pm: I take a break from work and veg out with an online racing game. Throughout the game are product placements and pre-rolls. Google places those too through AdScape. I wrecked and lost the game.
	2:45pm: I check my RSS feeds again through Google Reader. I go through about 150 feeds and post the best to my blog roll (it's embedded on the left column of my blog).
	3:00pm: I check on the stats for my blog over the past week using Google Analytics. Interesting to see where readers come from. Hello New Delhi!
	3:45pm: Just in surfing the web I come across 2 or 3 major sites that run Google for searching site content. MySpace is one of those.
	5:30pm: I see some display ads running on a couple of sites powered by DoubleClick's DART system. Google owns them now too. More on this development in a future post.
	6:15pm: One last check of my Gmail and I wrap up a blog post and head home.
	7:30pm: I get home, turn off the phone and play ball with Copeland and Crawford. Just then, the phone rings. Is that Google calling me? They certainly have my number.

Oddly, not that much has changed. Google has crept in a little more through M&A, but they definitely aren't going away. I know I am missing things that Google offers. Leave me a comment with the other ways in which you are impacted by Google in your everyday life.

 

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