Dominant marketing share of a search engine

There can’t be many more daunting than taking on search engine monster Google as marketing challenges go. With the exception of China, where homegrown engine Baidu rules the roost, Google’s dominance is uniform.

In the UK, it has an 80% share of the search market and shows no sign of losing ground to its closest rivals Yahoo!, MSN, AOL and Ask. According to Online estimate, 3.5 times as many UK searches are conducted on Google as on the other 38 leading engines combined.

The significant gap between Google and its rivals has been graphically demonstrated in recent times by Microsoft’s $44bn bid to acquire Yahoo. If that deal goes through, Microsoft/Yahoo! would still have just 15% of the global search market compared to Google’s 62%.

TV ads and posters proclaiming the superiority of search engine won’t shift behavior dramatically. It’s the quality of search engine results that dictate usage, Google’s product works, which is why most people don’t feel a need to switch. If it makes any changes to its listings, they are very subtle so as not to make users feel uncomfortable. Google delivers a satisfactory service for most mainstream users.

The problem for the other engines is that search is a functional experience, so there is little point trying to shake up the status quo through branding. To really change things, you have to come up with a better algorithm; make sure people know about it, then make them change a deeply ingrained usage habit.

These habits are so entrenched that even the offer of money has little impact. A few years back Amazon tried offering financial incentives to customers who switched to its search engine. It didn’t catch on, leaving Amazon a long way behind in the search race.

Things might have been different if Yahoo! and Microsoft had taken on Google a few years ago. But they were slow to recognize the emerging threat. In fact, it was Yahoo!’s use of Google as its default search engine that put the latter in the driving seat.

The popularity of Google’s product means MSN and Yahoo! have been unable to take advantage of other areas where they might be perceived as stronger. For example, their role in internet service provision and online content means they are able to put their own search products right in front of people. Yet this hasn’t stopped the majority of surfers from using Google.

This business isn’t just about marketing to consumers, but the B2B partnerships you build. Google has been very good at getting its toolbar bundled with browser software, so even if you are looking at an MSN or Yahoo! page, you see the Google box in the corner of the screen.

One important alliance for Google has been with Apple. Anyone who uses Apple’s web browser Safari is exposed to Google’s search engine before anything else. Moreover, he says, for mobile search, Apple’s iPhone gives Google a ‘stronger position in a market which some analysts thought might expose a weakness.

Internet users change their behavior extremely rapidly if given a good reason. Despite Google’s dominance, 25% of visitors to Google also use MSN on occasion. This chink in the armor provides other players to showcase the accuracy of their engines. There are areas where Google is not a runaway winner. India is a virgin territory for search, which is one reason Microsoft has committed $1.7bn to the market.

Lastly, the search business is not just about individual search. A big part of Google’s business involves providing contextual ad links to third-party websites. Here, its success depends to some extent on maintaining the goodwill of media owners, media agencies and advertising networks, either through the way it conducts its business or the financial terms it offers.

Google’s reputation among agencies has improved in recent times after a rather shaky start. There’s a general desire among agencies to have more than one place to put their clients’ money, even if other engines don’t have Google’s economies of scale.

The difficulty for rivals is that Google is not just good at search but also integrating advertising. Agencies might decide to revisit their relationship with the engine. The Google/advertiser relationship is underpinned by agency discounts. But when these stop at the end of 2008, agencies may look at other ways to allocate spend.

Media owners would probably welcome such a move. Many are angry with Google over subsidiary YouTube’s lax attitude to the use of copyrighted video content. If News Corp bought Yahoo! and replaced Google as the default engine on MySpace, that could change the market dynamics.

The prevailing view is that if Google loses its pole position it will be self-inflicted. A PR blunder looks the most likely way for Google to be caught out.
Underpinning the debate is search’s role as only one aspect of the fast-growing online ad market. Google doesn’t want to win the search battle to lose the online war, which is why it acquired DoubleClick to boost its position in display ads, and has moved into social networking via OpenSocial and email via gmail.