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Purchasing Eyeballs: Microsoft's Rebate Program |
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Dr. Samuel Says -
Bidness
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Written by Dr. Samuel Centralia, Ph.D., D.D.S., Esq.
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Thursday, 22 May 2008 |
Experience is a stern taskmaster, and over the years I have learned from my many mistakes. There are, in particular, three things I simply do not do anymore. I don't use ammonium nitrate as an oxidizing agent, I don't pay attention to Sports Illustrated's preseason baseball picks, and I don't bet against Bill Gates.
 With its effort to buy Yahoo apparently dead in the water, Microsoft is
rolling out a series of Plans B to increase its share in the lucrative
Internet search market. Currently, Microsoft is a distant third behind
second-place Yahoo and the industry behemoth that is Google.com. New
research projects that Google’s share of all searches in the United
States grew in April, to 61.6 percent, from 59.8 percent in March.
Google again took directly from its main competitors, Yahoo and
Microsoft, which experienced declines in search share, Yahoo to 20.4
percent, Microsoft to 9.1 percent.
So the boys in Redmond are considering a new tack. A new program
announced this week will offer rebates to people who use Microsoft
search services to find and buy certain products. The Live Search
Cashback program is essentially a marketing effort by Microsoft to
promote its search service. In other words, they're willing to pay
consumers directly (more or less) if it means gaining ground on Google.
According to Microsoft, 700 merchants offering more than 10 million
products have agreed to participate in the program. They include
Circuit City, eBay, Home Depot and Hewlett-Packard. Microsoft itself
will typically determine the rebate in any given purchase; the amount
Joe Websurfer stands to receive will depend on many variables, deals
and promotions.
It's an interesting approach to what is fundamentally a marketing
dilemma. If the rebates are at all substantial, it's a solid
incentive-based initiative that should win Microsoft some points in the
market standings. One of the bedrock mathematical axioms of our time:
Bill Gates = smart.
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