Katherine Egbert, an analyst at Jefferies & Company, says that Microsoft is planning an advertising blitz to publicize its search efforts, stating, ”Microsoft is set to spend $80 million to $100 million to advertise ‘Bing’… The budget for the ad campaign suggests that Microsoft plans to go head-to-head with the Google brand.” They need to do something if they actually intend to compete with Google, which commands about 70% of all search queries, while Microsoft currently serves less than 9% of searches, a number that has been shrinking. However, advertising alone cannot ensure success, as learned by those behind Cuil, the last new search engine to receive significant media and advertising exposure. Unfortunately for everyone involved, users decided it was not so cuil after all.

Is Yahoo on Microsoft’s Agenda? 

Several sources indicate that just last week Microsoft registered a limited liability company (LLC) in Delaware, a move that often precedes acquisitions or joint ventures. Microsoft also raised $3.75 billion in its first-ever debt offering this month. Coincidence? “The timing of the registration and recent debt raise indicate to us that it might be more likely Microsoft uses the LLC to force a partnership or to boost the amount of traffic flowing through its search engine,” wrote Katherine Egbert in a note released Tuesday.

The newly registered LLC could be the precursor to a Yahoo! deal. Just yesterday, when questioned about a possible Microsoft alliance, Yahoo CEO Carol Bartz confirmed ongoing Microsoft-Yahoo talks and stated, “if there’s boatloads of money, and there’s the right technology, and the information we would have to have, then yeah… it’s that simple.” Of course, there is also speculation that Microsoft is interested in various other potential acquisitions as well.

So what does Bing promise to bring? Well, that remains to be seen. In the meantime, we’ll see if Microsoft can first push Bing.com’s traffic past that received by bingo.com or even bingcrosby.com, each currently receiving considerably more traffic than Microsoft’s new proposed venture (view stats). To date, Microsoft’s search platforms failed to achieve wide public appeal, with Google basically controlling the market. Microsoft is desperately trying to challenge Google’s dominance. Is Bing the answer? And will Yahoo somehow be part of it? Internet history and the search marketing landscape continues to evolve and develop before our very eyes.

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Hello all,

Instead of asking for help this time, I hope that I can provide some.  If you are managing or responsible for pay per click (PPC) advertising accounts, you may be able to relate to my experience or be interested in feedback about different ways in which to manage PPC.  If so, read on.

In the past 5 years, I have tried numerous solutions for managing the Google, MSN and Yahoo Pay Per Click accounts we use as part of our online marketing strategy.  While all of the solutions have sufficed during the time period they were used, I think the one that I currently have is what we will stick with for a while.  As the market has become more competitive, new options have developed and I have tried a few.

To review the history, I started with a one person consulting firm who managed the pay per click accounts.  She did fairly well setting them up but after setup, was really only changing the bids rather than actively managing the accounts.  She had another job and this was a part time gig for her.  I was happy with her work at the time (she was used for 2.5 years), but changes in my company required that I cut costs and I had to learn the task of managing the pay per click accounts myself.  I managed the pay per click advertising accounts for about 2 years and because it was only one of many responsibilities I had, I am sure that I did not do it very well.  I learned enough to be informed, but not enough to be really good.  Maybe just enough to be able to hire someone else to do it.

In the middle of last year I started looking for a technology solution for my pay per click management.  There are many, many pay per click technology solutions out there and I checked into a few of them.  One was a firm called “Efficient Frontier”.  These folks use the same concepts used in portfolio management to find the most efficient spend for your pay per click dollars.  Although I have not used them, I received good feedback regarding their service during my research.  Problem is, you really need to be spending over $30 – $50K per month to even consider this and at last check they do take a big piece of the spend (10% – 15%).  They are well suited for large organizations that spend millions of dollars per month or year on pay per click but not really for small guys like my company.  The other issue with efficient frontier for my firm is that we do not have any conversions online, all of our sales are offline.  This is more challenging for a company like Efficient Frontier, but I am sure they have made strides in meeting this market need (offline conversions) since I evaluated them a year ago.

Because we did not manage enough monthly spend to use Efficient Frontier, I moved on to two smaller firms that work somewhat similarly to Efficient Frontier in that they have developed pay per click optimization technology.  The firms are Yodle and Reach Local.  The difference between these firms and Efficient Frontier is that they are able to work with smaller firms that manage less spend AND they use “reverse proxy” technology to link a phone call to a specific keyword search (using time of day, IP address matching and other proprietary tools).  In this way they have developed a way to better optimize pay per click spend for service companies like my own whose sales occur offline.  What was important to us with these companies was that their systems “learn” which keywords were driving the most calls and in this way bid higher for those keywords and lower for others that were not driving calls.

Unfortunately, my test pilot program for Yodle and Reach Local failed in both cases.  In both cases, I hired them to manage one small portion of our pay per click program (about 10% of monthly spend) to determine if they could succeed with it and from there add more spend to their management if they succeeded.  In both cases, the quality of service and communication were huge issues.  I was not able to speak directly to those persons that were managing the accounts day to day and for this reason, it seems that there was a lot lost in translation.  Some of the ads that were being used did not represent our brand well and that was not being communicated well by the intermediaries (sales folks).  In other cases, it did not seem that the sales team clearly communicated which keywords would be part of the program as the persons managing the account were bidding on keywords that were not in the contract and competed with our own current PPC bids.  The assurances that had been made before singing a contract about how much expertise the individuals who were managing the accounts had did not live up to expectations.  In other words, I was being told that I would have a PPC manager that had worked for companies in my industry and would therefore know many of the best practices for getting high conversion rates so that their technology systems did not have to work as hard to optimize our campaigns.  Things would happen more quickly for us in other words and lead to a quicker ROI.  None of the promises came true and I ended up cancelling both of these programs before they really got into the swing of things because of the host of problems that occurred in the three month contract periods.  This is not to say that either one of these companies does not have a viable (or valuable) model for managing pay per click.  It just didn’t work for me and what I needed.

This brings me to my current solution.  I am not even sure how I found JumpFly, Inc. but when I did, it struck me that they did not use any technology to manage their campaigns – they used real people.  Real people that I could talk to and e-mail.  I also started the month-tom-month contract with this company using only 10% of our monthly spend.  Within 1 month, I could tell that they were succeeding in vastly improving my ROI for PPC and I gave them all accounts (total of between $20K and $25K per month).  Prior to their management of the Google PPC account, I was paying approximately $16 for a conversion where a conversion was measured as the user reaching the “Contact Us” page where they can view our office locations.  This last month, the conversion cost was down to about $11.  During this time, the number of conversions has actually increased.  So, we are spending about 25% less than we were before, but getting just as many or more conversions.  Having started around $16K in spend per month for Google, we are now down to about $11K or $12K, and their service fees are much less than the associated cost savings.  I am very happy with this actively managed solution and wanted to recommend JumpFly, Inc. to any others in the Anderson network that are struggling with how to manage their pay per click advertising accounts. Finally, I sent out an e-mail last fall to the alumni group and one other alumnus had used them and gave them good marks as well. Check them out if PPC management has been a thorn in your side, like it was for me for five years.

Call me at 310-373-5000 if you would like to talk further about Jumpfly or PPC management.

Regards,
————————————-
Kevin DiCerbo
Celibre
23211 Hawthorne Blvd.
2nd Floor
Torrance, CA 90505
Office: (310) 373-5000
Fax: (310) 373-5012
www.celibre.com

After evaluating each entrant on customer satisfaction, depth of knowledge, reporting methods, internal principles and competitive advantages, a winner is chosen. According to TopSEOs’ spokesperson Jeev Trika, “These firms have been scrutinized over an entire year. Winning firms understand and excel within their field, have great unique advantages and practice what they preach.”

JumpFly’s only focus isPPC Management. They believe the fast paced, constantly changing PPC marketplace is too important to each client’s bottom line to try and provide a “One Stop Shop” for Internet marketing services. After starting many years ago as PPC pioneers, JumpFly’s dedication to managing the Google AdWords, Yahoo! Search Marketing and Microsoft AdCenter platforms earns their team unmatched experience and industry relationships. Mike Tatge, JumpFly Managing Partner, said “This recognition is special. We won based on a thorough evaluation of our clients’ satisfaction and results. We are very proud of this. It’s why we do what we do.”

The JumpFly team has a great reputation earned to date, and looks forward to many more years of providing the best PPC management available. JumpFly is a Google Qualified Company, Yahoo Search Marketing Ambassador and Microsoft adExcellence Member. JumpFly was also invited to participate on Yahoo’s Traffic Quality Council, receives office visits from Google and has never received any complaints according to the Better Business Bureau. Furthermore, JumpFly works month to month and offers a money back guarantee, again demonstrating their commitment to value and relentless drive to provide clients the best results possible.

View TopSEOs’ Press Release

The Rich Ads in Search program is currently only being shared with a small number of brand advertisers at this time and enables them to:

• Post images and video, which can increase the branding impact of search advertising.
• Create deep links to relevant pages, which can help drive conversions directly from the Yahoo! search results page.
• Include boxes within the listing that lets users search for their desired product or a store location directly without additional navigation.
• Show their logo, which enhances user trust.

This service should eventually be available to all advertisers. The Rich Ads appear as “Promotional Results” next to the search listing.

I suspect that we are in the midst of the Great Online Video Revolution. YouTube has already taken the world by storm and has been testing video advertising with YouTube Sponsored Videos. However, Google has not yet made the jump to include video ads within search results. However, I suspect it is just a matter of time. Yahoo is first to market with this concept, but if and when Google chooses to move, they will likely takeover the online video advertising market. It will be fun to watch this evolve over the next several years. If you are looking for custom web video production, Webivore has done a nice job with videos for several of our clients.

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Just last month, Ask.com finalized a deal with NASCAR to sponsor #96 Bobby Labonte and make Ask.com the “Official Search Engine of NASCAR” for this season. That is an interesting approach that just may help Ask.com reach a new and significant audience, with an estimated 75 million NASCAR racing fans. This could provide a badly needed boost for Ask.com’s struggling search engine.

Ask.com currently ranks a distant 4th in Search Engine Market Share, receiving 2.4% of all searches in December, 2008. This equates to 265 million monthly search queries, a decrease of 10% from the year prior (in the same time period, Google grew by 49%, now receiving 7.9 billion monthly search queries). It appears that Ask.com needs to do something. So, maybe NASCAR is the answer, especially since there was no sight of Google, Yahoo or Microsoft anywhere at the event.

Ask.com currently offers PPC advertising via its “ASL network”, consisting of 90+ syndication partners, across a multitude of search properties, portals and meta search sites that include (but is not limited to) Excite.com, iWon.com, CNET.com, Mamma.com and Lycos.com. When I last tried it, I was not particularly impressed with results, but admittedly, that was some time ago.

As far as the Daytona finish, don’t Ask! It was quite disappointing, finishing with an incredibly lack luster rain delay. It will be tough for Daytona to ever come up with a finish like 2 years back, where a last lap crash led to an insane finish with one driver, Clint Boyer, actually crossing the finish line upside down (view video).

However, that is not to say the race did not have its moments. Fan favorite, Dale Earnhardt Jr. caused an accident that took out 9 of the leaders (some say intentionally). Too bad for Ask.com that they can’t just as easily eliminate their competitors; they only need to take out 3.

JumpFly previously had the pleasure of working with NASCAR via relationships with McGlynn Racing in the Cup Series (view pictures) and Key Motorsports in the Truck Series in past seasons. Maybe one year JumpFly will win the Daytona 500. On that note, the driver for McGlynn Racing when JumpFly sponsored them was Derrike Cope, who actually did win the Daytona 500 in 1990.

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All account managers here at JumpFly have witnessed improved success rates with Content Match over the past six months. In fact, a handful of our clients actually receive 30 – 40% of their traffic and conversions from Content Match.

One particularly useful recent AdWords enhancement, Placement Targeting, enables advertisers to reach specific targeted content partners. When properly identified, successful partners can be isolated and focused on. Just yesterday I was looking at an account we manage where one specific content partner is isolated in an ad group with a high bid due to its success, and this single content partner is responsible for providing the majority of overall conversions for this particular client. Properly identifying and reaching this particular content partner for this advertiser was critical and proved to be the major factor contributing to this client’s success.

So if you have neglected to consider Content Match at Google, I suggest you reconsider. Content match advertising requires a different style setup than search engine advertising, and requires using different reports to fine tune and adjust results. However, the extra effort just might give your business the edge it needs to succeed in today’s increasingly challenging economy. Hopefully this highly coveted PPC Super Bowl victory will help give AdWords Content Match the respect it so badly deserves.

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Bartz is also on the board of directors for Cisco Systems Inc. with Jerry Yang and is also a member of the Intel Corp. board with Yahoo President Susan Decker, who also interviewed for the CEO position. In fact, Yahoo announced that Decker will resign after a transitional period. Wow, guess she’s angry.

Chairman Roy Bostock said Bartz “is the exact combination of seasoned technology executive and savvy leader that the board was looking for, and we are thrilled to have attracted such a world-class talent to Yahoo. She is admired in the Valley as well as on Wall Street for her deep management expertise, strong customer orientation, excellent people skills, and firm understanding of the challenges facing our industry.”

Bostock added that the board “thanks Sue (Decker) for her service as President, the important contributions she has made to Yahoo’s development in a variety of roles over the past 8 1/2 years, and her willingness to work with Carol Bartz to ensure a smooth transition. We respect her decision to move on to other challenges and wish her only the best.”

Bartz’s appointment already sparked renewed speculation of negotiations with Microsoft, who continues to proclaim they are very interested in Yahoo’s search division. Microsoft CEO Steve Ballmer, who tried and failed to buy Yahoo last year, publicly said in the past few weeks that a search deal with Yahoo should be made when there is a management transition at both companies. Microsoft late last year hired a former Yahoo search executive to lead its Internet business.

Microsoft is feverishly working to prevent Google from getting 100% of all online search queries. If Google continues to gain market share as they have in the past, it won’t be much longer until they are there! Recent data from HitWise indicates that Google has once again increased their market share in the month of December.

At this point, one must wonder if Microsoft or Yahoo has a shot at competing with Google, together or on their own. Of course, at one point, AOL basically controlled the entire online population, so things certainly do change, and fast.

Investors did not react much to this news yesterday, but many discouraged Yahoo investors have likely already thrown in the towel at this point. Yahoo announces earnings on January 27th, so we’ll see if they have anything to say about Microsoft by then. It will also be interesting to see how PPC advertising is weathering the economic storm.

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1) A company YouTube “Channel”
2) Video ad/ads production
3) YouTube campaign development, implementation & management

The newness of this platform provides early adopters an exciting opportunity to capitalize on YouTube’s massive user population as well as the current lack of advertisers and resulting very low cost-per-clicks (CPCs).

Founded in February 2005, YouTube was purchased by Google in November 2006 for $1.65 billion in stock roughly 1-½ years later. Today, YouTube is the #2 search engine and the #3 most visited website in the world. YouTube serves close to 1 billion videos every day and its users upload 13 hours of video every minute. According to HitWise, YouTube’s market share in the U.S. video sector is 73.18%.

Right now, advertisers can get started with really low CPCs before the advertising at YouTube gets competitive. I created a simple campaign for JumpFly as a test and was able to attain impressive first page results for as little as $0.15 per click. As YouTube’s growth continues and video becomes more mainstream, YouTube will likely represent a valuable advertising avenue for many advertisers who properly go after this new marketplace. Learn more about YouTube Sponsored Videos or consider having a professional PPC Management firm assist you in developing your YouTube Sponsored Video campaign.

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JumpFly YouTube Channel

The National Retail Federation (NRF), the industry’s largest trade group, still estimates that total holiday sales will grow 2.2% this year, which may prove optimistic and would still represent the weakest gain in six years. However, several other retail experts expect a worse performance, and are even forecasting the first-ever decline in overall retail sales. Since online sales are down, I personally fear overall sales will follow suit this holiday season. Here at JumpFly, we are hearing clients citing economic concerns with increasing regularity.

Following a strong week for online sales after Cyber Monday, driven by large discounts on consumer electronics products, comScore said sales slowed significantly in recent weeks. The softest categories included music, movies and videos (down 24%); office supplies (down 19%); jewelry and watches (down 17%); and home, garden and furniture (down 16%). Some bright spots included sport and fitness (up 31%); books and magazines (up 18%); and video games, consoles and accessories (up 17%).

A recent NPD survey conducted earlier in December indicated that 31% of consumers said they were concerned about their job security and had cut back on their spending. Fear is a powerful motivation to curb spending, as witnessed by this year’s dismal holiday sales season. Let’s hope that 2009 brings better times for our struggling economy.

Happy Holidays to all. May 2009 bring you all great health, wealth & happiness.

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About JumpFly:

JumpFly professionally develops, implements and manages Google AdWords, Yahoo! Search Marketing and Microsoft adCenter Pay Per Click (PPC) Advertising accounts, JumpFly is a Google AdWords Qualified Company, Yahoo! Search Marketing Ambassador and Microsoft adExcellence Member. JumpFly was recently named the #1 PPC Company in the country by TopSEOs.com.

Prosecutors allege that Madoff, a decades-long veteran of Wall Street who previously served as chairman of the Nasdaq Stock Market, confessed to losing at least $50 billion in a Ponzi scheme. A Ponzi scheme is a fraudulent investment operation that involves paying abnormally high returns to investors out of the money paid in by subsequent investors, rather than from the profit from any real business. As long as he could attract new investors, the alleged scheme worked. The plot appears to have unraveled when clients asked to withdraw their principal only to discover that Madoff’s coffers were empty.

Nobody was spared. Large investors, banks, charities and small investors alike were all impacted, leaving some people with nothing after they trusted this man with all their money. Another harsh reminder for the need to diversify. New details continue to emerge as this investigation intensifies.

What’s next? We’ve already seen Illinois Governor Rod Blagojevich arrested for allegedly pimping out President-elect Barack Obama’s Senate Seat while he was already under investigation. Meanwhile, around the world there are pirates seizing ships on the open seas and just yesterday, an Iraqi protester threw his boot at President Bush while in Baghdad. The nerve of some people! The bottom line is that we continue to live in times of great instability. It is a really good time for individuals to re-assess their financial situations and take necessary actions to prepare for continued instability. Businesses must also do the same.

Here at JumpFly, we often review previously setup Google AdWords accounts where tens or even hundreds of thousands of dollars were spent very unwisely. To me, this is just as insane as the allegations against Madoff & Blagojevich. The pay-per-click (PPC) advertising marketplace is rapidly evolving, and not considering professional assistance may be a costly mistake. With the new year, constantly changing interfaces, increasing competition, the challenging economy and ongoing instability, now is a great time to consider professional PPC management. Why not at least get a free consultation?

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According to regulatory filings, Billionaire investor Carl Icahn increased his position in Yahoo by 6.78 million shares between November 24-26 (at about $10 per share), raising his total to 75.58 million shares (about 5.5% of the company). I saw a recent presentation he made where he stated that he continues to believe Yahoo shares are undervalued, but admits that he also thought they were undervalued when he was last purchasing shares near $25 per share. So far, he is down about $1 billion on his investment. Ouch! He is still looking for some type of partnership with Microsoft on their search efforts which he believes could help save Yahoo a great deal of money. While there are no alleged talks going on at this time, I suspect these two will eventually work out some type of agreement. With Yang stepping down and both Icahn and Microsoft’s Steve Ballmer expressing interest in a search deal getting done, I think something will eventually develop. I would also like to mention that I very much hope that Carl Icahn is a better investor than speaker because quite honestly, listening to him speak was a little painful. Sorry Carl, but it’s the truth.

Black Friday & Cyber Monday Both Posted Impressive Increases Year Over Year

Sales during Black Friday, the day after Thanksgiving, saw an increase of 3% over the prior year. Last year’s sales of $10.3 billion on Black Friday increased to $10.6 billion spent this year. Though this gain appears promising for the economy, many fear that the increase in sales was at the expense of profitability. And though spending was up on this day, it may still be down for the Holiday season. One Gallup Inc. poll suggests that spending on gifts will be down 29% from a year earlier. We’ll soon know for sure.  

Online shopping saw a more dramatic increase in sales. According to data released by ComScore Inc., online sales for Cyber Monday, the Internet’s equivalent to Black Friday, jumped 15% from a year ago as Internet sites lured millions of consumers with offers of free shipping and dramatically reduced prices. Online sales increased from $733 million on Cyber Monday in 2007 to $846 million this year. Forrester Research expects 12% year-over-year growth for online holiday sales, or $44 billion in this November and December.

The US Economy Searches For Stability 

The US Economy continues to look a bit frightening and unstable. However, some good things are also taking shape. Gasoline prices are the lowest they have been in years, with prices at about $1.70 per gallon here in Illinois. That’s a far cry from the $4+ getting charged just 6 months ago. Additionally, mortgage rates are dropping and refinancing is rapidly picking up, enabling homeowners to lock in lower rates and lower monthly payments. Though we are clearly not out of the woods yet, there does seem to be shared hope that the economy will stabilize and business will pick up by the end of 2009. I suspect it’s going to be an interesting year.

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Perhaps in the short-term, according to Merriman Curhan Ford analyst Richard Fetyko. Yesterday, Fetyko issued a release via Barrons stating, “Based on our checks, the decline in consumer and business purchasing is having a dampening effect on search-engine marketing (SEM) — keyword prices are down 5%-30% from the third-quarter of 2008, traffic to ecommerce sites is also down year-over-year and quarter-over-quarter, and click-through-rates on ad listings are declining as well. SEM is expected to be among the last places to see cuts, and we are there now. Advertisers are adjusting their keyword buys to protect their margins and returns on investment, which are under pressure as sales-conversion rates and average order value dropped, based on our checks. Google’s paid-click volume is also under pressure. Since consumers and businesses have reined in their spending, they are searching for fewer commercial items and are clicking on fewer ads (click-through rates dropped), which translates into slower growth in paid-clicks volume (key revenue driver). Weakness has also spread overseas. Domestic growth has decelerated in 2008, and we expect international regions to slow in the fourth-quarter of 2008 and 2009 as well. U.K. ad revenue was flat for the last three quarters, and the rest of Europe and Asia are seeing cutbacks in ad budgets as well.”

Not surprisingly, various research agencies are reducing their projections for online advertising growth going forward. Just last week, marketing research firm eMarketer reduced estimates for U.S. Internet advertising to $25.7 billion for next year, about $2.7 billion less than a forecast from just three months ago, but still a 9% increase over this year. EMarketer predicts U.S. search ads will generate $12.3 billion next year and that “display ads” will rise nearly 7% next year to $4.9 billion (less than the 14% growth previously suggested). Considering we’re in the midst of the worst financial crisis since the 1930s, I would say that any growth at all is pretty good! The reason for continued growth in PPC advertising despite this crisis is because it works.

While “decelerating growth” may be a sobering reality for Google, it will not bring them to their knees. In the near term, Google may have to make some adjustments, but they appear incredibly well positioned to potentially dominate multiple marketplaces going forward, including organic search, sponsored search advertising, online video & the wireless market. Organic search, PPC advertising and online video (via YouTube) are already in the bag, at least for now, and Google’s wireless Android platform is new but already creating a lot of buzz. Actually, I personally think that what Google has already accomplished is amazing and I look forward to witnessing their future innovations. They always seem to be one step ahead of the competition.

Holiday Reminder- The busiest shopping day of the year, Black Friday (this Friday) is followed by the biggest online shopping day of the year, Cyber Monday (next Monday). Happy Thanksgiving.

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Failed Microsoft Buyout

Things became particularly interesting for Yang about six months back, when Microsoft attempted an unsolicited buyout for roughly $33 per share, which was a generous premium to Yahoo’s $19 stock price at that time.  Unfortunately for Yahoo shareholders, at least in the short term, Yang vocally resisted this opportunity and took measures to ensure that it would not come to be. Today, Yahoo’s stock price sits under $9 per share just six months later, the lowest level since 2003.

Microsoft might come back to the table, but just yesterday Steve Ballmer said, “We’ve moved on,” during a shareholder meeting in Bellevue, Washington. He reiterated that a partnership between Microsoft and Yahoo in the Internet-search market is “an interesting possibility.” However, Ballmer added that there are no talks about such a partnership at this time.

Google Backs Out of Partnership

Some are speculating that the final blow to Yang recently came from Google, who backed out of a proposed ad partnership to avoid a potential anti-trust battle with the Justice Department.

YouTube Surpasses Yahoo

Earlier this week, Comscore data revealed that YouTube surpassed Yahoo as the second most popular search service, receiving 2.6 billion search queries in August, 2008 compared to Yahoo’s 2.4 billion queries. The rapidly growing online video marketplace represents yet another area that Google dominates.

In a memo emailed to Yahoo employees Monday announcing his resignation, Yang wrote, “All of you know that I have always, and will always bleed purple. I will always do what I think is right for this great company. While this step will be an adjustment for all of us, I know it’s the right one.”

Yahoo needs to do something in order to prevent their one time search engine dominance from deteriorating into obscurity. Yahoo still boasts 500 million users worldwide, but increasingly every month, more and more are turning to Google for their search needs.

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The blog states, “… after four months of review, including discussions of various possible changes to the agreement, it’s clear that government regulators and some advertisers continue to have concerns about the agreement. Pressing ahead risked not only a protracted legal battle but also damage to relationships with valued partners. That wouldn’t have been in the long-term interests of Google or our users, so we have decided to end the agreement.”

In response, Yahoo! said it was disappointed by Google’s decision and maintained that the abandoned partnership would have been beneficial for everyone. Yahoo! just lost out on hundreds of millions of dollars in additional annual revenue that would have resulted from the deal. Yahoo!’s statement also said that they are, “disappointed that Google has elected to withdraw from the agreement rather than defend it in court.”

Several analysts speculate that losing the Google deal will make Yahoo! more likely to revisit a possible deal with, or outright buyout from Microsoft. Details of the Google-Yahoo! partnership put up significant barriers to a Microsoft buyout – barriers that no longer remain. Yahoo!’s stock price finished up today despite the DOW plunging 486 points, likely due to investor speculation and hopes for renewed buyout potential. We’ll see how this plays out, but I’m confident that Microsoft execs are talking about this situation as I type. Tic toc. Tic toc. Time will tell if Microsoft will come back to the table. In the meantime, Google continues to expand their search dominance.

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What is Click Fraud & Why Does it Exist?

Click fraud is a scheme that takes advantage of PPC advertising programs like Google AdWords, Yahoo! Search Marketing and Microsoft adCenter. One of the more common scams involves a company developing a fraudulent website and then participating in programs like Google’s AdSense. Criminals often use software “hitbots” or employ boiler-rooms of low-wage employees from other countries to generate clicks on their own ads, and then collect commission from PPC advertising providers.

Click Forensics Research Indicates Ongoing Click Fraud

• The overall industry average click fraud rate was 16% for Q3 2008. However, the click fraud rate among top-tier search-sites like Google and Yahoo was lower.

• The average click fraud rate of PPC advertisements appearing on search engine content networks, including Google AdSense and the Yahoo Publisher Network, was 27%.

• The greatest percentage of click fraud originating from countries outside North America came from Russia (5%), France (5%) and the U.K. (4%).

What is Google Doing about Click Fraud?

I frequently focus on Google AdWords, as they are the PPC leader and the main concern of most PPC advertisers. Google already has powerful prevention techniques in place to detect invalid clicks and they will not charge advertisers for these clicks. Click here to learn how Google detects invalid clicks.

In fact, Google AdWords advertisers can run a Campaign Performance or Account Performance report to see the number and percentage of clicks that have been classified as invalid and automatically filtered from their accounts. This information is fairly interesting. When viewing this data for our JumpFly Google AdWords Account, I can see that Google identified 13% of our overall traffic from last month as fraudulent. The majority of invalid clicks were detected from our exposure to image ads on the content network, where Google identified 46% of the traffic as invalid.

Click fraud represents a reasonable concern for PPC advertisers, but Google and Yahoo are already doing a great deal to prevent fraudulent activity and refund advertisers when applicable. Additionally, using free tools provided by Google AdWords or 3rd party software can greatly assist advertisers in further identifying and eliminating potentially invalid clicks, a topic that I will further explore next time.

View common click fraud related concerns addressed by Google.

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