Microsoft Live Search, the third most used search engine after Google and Yahoo with less than a 10% market share of online searches usually doesn’t come up in the conversation too often, but it made an interesting ripple last week when it was incorporated in the social search results of the immensely popular social networking site Facebook. This got me thinking about who stands to benefit more from this action, Facebook or Microsoft? While I’m sure both sides stand to benefit; Microsoft can potentially increase the use of Live Search by tapping into the social networks millions of users and Facebook adds yet another functionality to their site. However upon reflection I believe the convergence of Search and Social is clearly more important towards the Social Network, which has yet to establish its ability to effectively monetize through ad revenue the same way Search Engines have successfully done.
In the last two years Facebook has made continual changes in their advertising platform, they call “Social Ads”, hoping to increase their ad revenue, which like many other websites is their primary method of income. The selling point for these ads is the ability to target market to very specific audiences based on the information in user profiles (location, interest, hobbies, age, gender, religion, favorite music, books, movies, etc). They have also implemented several free tools such as Facebook Pages to help companies build brands on Facebook, pushing companies to promote these pages through paid Social Ads. Yet among Marketers the success of Pages and Social Ads is often a matter of controversy on whether or not advertising on Facebook yield desired results. They have ad models for both PPC and CPI, but the results of these ads have been abysmal when compared to the results of attainable through Search Engine Marketing.
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I think there are many factors involved in Facebook’s lack luster income but most involve the fundamental difference between Social Networks and Search Engines. Information in someone’s profile is passive in that a person doesn’t input that data hoping to receive ads for it, they put it there for their friends to see which is the cornerstone of social networks. Compare this to a search query in which a user is actively seeking information for a very specific topic of their choice at that specific moment in time. I’m not saying that Social Marketing is a waste of time, but I think it has yet to find it’s rhythm and believe me they are searching for that rhythm as we speak. There is much potential for Social Marketing, I believe that with the right strategy companies can engage their users in new and beneficial ways.
This comparison between the core products of Google and Facebook (search and social networks) is important because the two companies in some respects seem headed for a showdown with competing products such as Facebook Connect and Google Friend Connect. Both companies are attempting to spread their influence to all corners of the net, with the advantage clearly to Google which has already established their dominance is so many areas, not to mention making a ton of money in the process. The underdog, Facebook admits to being focused on growth not income right now, and with their partnership with Live Search they are treading further into Google’s territory. As both companies vie for your time online, I predict we will see many interesting developments and an increasing convergence of search and social among all parties.