I have to agree with Michael Arrington. The new move by Microsoft, Cach Back, seems like a desperate move, but it could also turn out to be a game changing one.
Until we will see more brand advertising money goes into digital, search will still be the king. And Microsoft is in big trouble in this field. Google is the de facto ruler of web search and because of that also of the search advertising money.
In recent years Microsoft worked hard on developing better search algorithms and products, but even when they were successful (I’m saying for a long time that some of the Live properties are much better than the Google competitors) it wasn’t enough to push users to do the switch.
It’s a psychological issue. Too many people are fixed on the notion that Google is the web. That Google results are the only result.
So how cachback can change this?
By giving money to the users.
What brilliant here is that Microsoft finally realized that they actually don’t have to completely convert people to Live from Google. All they need is just the last ad click.
We have written about this in this blog a couple of times - the current way advertisers are measuring ROI is very wrong. But it is the way used these days and it can play into Microsoft hands.
Currently when advertisers are trying to attribute a purchase to a campaign, they look at what ad (or referrer) the user clicked on to get to the site in the session in which the purchase was made. They basically attribute the all purchase just to this ad or campaign. This means, that it doesn’t matter if you used Google to do all your price comparison, if you used Google to search for the product for a week. If in the end you will go to Live, do a search (when you already know exactly what you want)an buy the product, Microsoft will get the all glory.
And this situation is exactly what could happen. Users will use Google to do the hard research as they trust it more than Live, but in the end will go to Live and make the purchase in order to get the cachback discount.
Simple but brilliant.
And of course Microsoft is hoping that if you will use Live for this for enough time, you will start to use it also for other searches and maybe in the end even convert totally from Google.
Ironically, Atlas that is now part of Microsoft is one of the leaders in trying to push a new attribution and measurement model (that I think is much more accurate) that called “Go beyond the last ad click”.
So will this work? Will Microsoft will win the last search battle? Hard to say, but it is probably their best move so far.
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