Small Business

Big Search Companies Woo Small Businesses

Byron Acohido, USA TODAY

Small business owners, take heed. If you've ever thought about advertising your company on the Web, some tech giants are offering help, much of it free.

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Google , Microsoft and Yahoo — whose bottom lines depend on selling ads linked to search results — are pouring millions of dollars into initiatives to demystify search-based ad campaigns and help small advertisers make the leap to pay-per-click advertising.

Several drivers are at work. The U.S. search advertising market is expected to hit a record $14.4 billion this year and swell to $17 billion in 2012, according to research firm eMarketer. Microsoft and Yahoo, as search advertising partners, aim to increase their combined 30 percent slice, while Google intends to keep a tight grip on its 65 percent  share, according to research firm comScore.

Each wants to compel local businesses to purchase those sponsored links that appear alongside search query results on Google, Microsoft Bing and Yahoo Search.

"Small advertisers are critically important, not only because of the huge revenue opportunities, but also because a broad spectrum of local advertisers provides a better user experience," says Kevin Lee, CEO of search consultancy DidIt.

However, it's all too easy for novices to become befuddled, says Larry Kim, chief technology officer at online advertising consultancy WordStream. Getting a sponsored link prominently displayed on a search results page requires mastering an art form. The advertiser must bid, auction-style, for certain words and phrases related to a product or service that a consumer might type as part of a search query. Payments are then calculated for each click on a sponsored link.

It's all too common for small advertisers to waste money on poorly executed campaigns, Kim says. "Typically, they don't re-evaluate and they miss out on the opportunity to leverage a powerful marketing channel to grow their business," he says.

It can become a classic lose-lose scenario. Advertisers overpay for clicks that gain them little new business. So they abandon search ads, says Lee.

To help streamline the process, Google recently launched AdWords Express, a paid service that automatically manages search ad campaigns for small advertisers. The search giant also introduced free phone support for advertisers, and free help designing mobile websites and pitching products within the Google+ social network.

"There's no shortage of options for small businesses to reach customers online," says Francoise Brougher, Google's vice president for small- and medium-size business sales and operations.

Microsoft has been doling out incentives to persuade consumers and advertisers to make the switch to Bing and adCenter, which supports ads on Bing and Yahoo!Search. Bing users can earn credits redeemable for products, gift cards or charitable donations through a loyalty program called Bing Rewards.

CEO, search consultancy DidIt
Kevin Lee

And the software giant has been distributing coupons worth as much as $200 in click credits, to entice small advertisers to switch from AdWords to adCenter.

Traci Lester, electronic marketing specialist at tech training firm ASPE, embodies the market so dearly coveted by the search giants. Lester in the past year has been trained as a certified AdWords expert. Yet in the past month she has diverted a portion of her company's advertising budget to adCenter.

"I much prefer Google's tools and I'm definitely Google-biased," says Lester. "But if you're serious about pay-per-click advertising, you need to be advertising in Bing and Yahoo as well. You'd be missing a huge market if you're not advertising on Microsoft."

Microsoft recently tweaked adCenter to allow advertisers to directly import their AdWords campaigns into adCenter.

"We need to enable advertisers to do things more quickly," says Matt Lydon, Microsoft's general manager for small- and medium-sized business advertising. "Our goal is to standardize with Google so advertisers can more easily port over campaigns and settings."