The Web portal has launched its first-ever attack ad campaign, claiming that its revamped search service works faster and gets users better results than Google GOOG, the Web's most-used search service.
In one radio ad that began airing nationally this month, an announcer proclaims that "search engines like Google get you lost in all of the links, but not Yahoo (NASDAQ:YHOO) search." The ad also calls attention to Yahoo search's drop-down menu that offers alternative words and phrases users can click as they type in words during a search.
"You won't find that on your Google page," the announcer intones.
Yahoo YHOO has positioned the ad as a humorous reminder that Google isn't the only search service, says Raj Gossain, vice president of marketing for Yahoo search.
"We're not trying to be nasty to them; I have a tremendous amount of respect for what they have done," Gossain said. "But our challenge as the No. 2 player in the market is to remind users that there is an opportunity to make a choice."
March figures aren't available, so it's uncertain if the ads are working. In February, Google's share of Internet searches in the U.S. rose to 59.2% from 58.5% in January, according to comScore Networks. Yahoo's share slipped to 21.6% from 22.2%.
Many people don't even know that Yahoo offers Web search, Gossain says.
"It's just a habit that people have of always going to the site of our friends up in Mountain View," he said, referring to Google's Silicon Valley home base.
Shahid Khan, a partner at IBB Consulting Group, says that Yahoo needs to act, but that using attack ads is surprisingly bad form on Yahoo's part.
"It just shows how desperate Yahoo has become that they would stoop to this level," Khan said.
But Barry Parr, an analyst at Jupiter Research, calls the ads a worthwhile gamble.
"They have a tough problem and not a lot to lose" by trying the ads, he said.
Yahoo remains the most-visited Web property, but it hasn't gained ground in search against Google. Worse, earnings and sales gains have stalled in the last year-plus, and it's the subject of an unsolicited takeover attempt by another fierce Google rival, Microsoft (NASDAQ:MSFT) MSFT.
Yahoo revamped its search service in October.
The new service gives users more than just links to Web sites. For example, a search for "10,000 B.C. movie" gives users a little box with viewer ratings, a link to a description of the film and a list of showtimes at local theaters.
Yahoo is trying to give its users short cuts to the information they want, Gossain says.
"We try to package a lot of great information, basically giving users answers they are looking for right at the top of the page," he said.
Some of Yahoo's new features aren't unique. Search company Ask, Ask a unit of IAC/InterActiveCorp (NASDAQ:IACI) (OTCBB:IACPP) IACI, offers a similar drop-down menu for Web search users. Google is testing such a feature.
"Yahoo is doing some interesting stuff, but it's pretty consistent with what everybody is doing with search," said Greg Sterling, head of Sterling Market Intelligence.
Google has never paid for ads to push its search service.
"We welcome competition that helps deliver useful information to users and expands user choice," Google said via e-mail when asked about Yahoo's new ad campaign. "Having great competitors is a huge benefit to us and everyone in the search space -- it makes us all work harder, and at the end of the day our users benefit from that."
Newstex ID: IBD-0001-23988742
Originally published in the March 25, 2008 version of Investor's Business Daily.
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