My last article regarding Bing’s partnership with Kayak resulted in several emails asking who Bing might partner with next. It’s an interesting question and one that merits thoughtful consideration.
Let’s go back a few years, when Bing was officially launched. On May 28, 2009, Microsoft launched Bing and Steve Ballmer declared it the decision engine. In the press release, Microsoft specifically called out Travel, Shopping, Local and Health as verticals where they wanted to simplify the task for consumers.
When placed in this context, Bing wants to help you make a decision (a purchase decision), and not just browse through multiple links like Google. Given Bing’s recent deal with Kayak, it looks like Bing’s new strategy may be to partner with best of breed third party vertical search engines that give consumers more choices, better curtailed results, and revenue for Microsoft.
In this context, the Kayak deal makes sense. Microsoft focuses on price predictor, while giving consumers a greater diversity of travel options via Kayak. One of the key reasons Microsoft quoted working with Kayak is the ability for Kayak to search more places than available on Bing, hence providing more answers to Bing users.
Microsoft seems to have realised that its internal efforts are best focused on core search improvements, improving user experience, and monetization. It has therefore chosen to stop or at least defer work in vertical search experiences and instead establish business and technical integrations with leading edge companies in these verticals.
Given Google’s ITA acquisition, Bing probably had to do a deal in the travel vertical soon. So, the travel vertical is covered for Bing via the Kayak partnership. What about shopping, local, and health?
Shopping is bigger online than travel, and growing faster online, which makes me assume that it’s a key focus for Microsoft now.
In shopping, Bing started off by applying considerable technical and marketing effort behind Microsoft Cashback, including acquiring a startup, JellyFish. However, this effort proved costly and did not drive the user loyalty Microsoft had been hoping for and ultimately it was shut down during the summer of 2010.
At the same time, all through 2009 and 2010, Google has been relentlessly pulling ahead in the shopping vertical. Google’s efforts now include a very comprehensive product index of several hundred million product offers though an expanded merchant centre receiving data feeds from hundreds of thousands of retailers. In contrast Bing shopping has just a few thousand retailers (100 times less) submitting data feeds and only tens of millions (10 to 20 times less) of product offers.
To see how serious Google is about the shopping vertical. Take a look at their recent activity.
1 – They buy like.com for visual search
2 – Google Shopper App rolled out on the iPhone and Android
3 – Integration deals with PowerReviews and BazaarVoice to get data feeds for aggregating product reviews from merchant web sites
4 – Organic web search results now show product images and prices through product feeds submitted to Google Product Search merchant centre.
5 – Google launches Boutiques.com. Focused on apparel/fashion market with visual search and soft goods shopping search technology acquired from Like.com and run by team from Like.com
To say that Google is serious about shopping is an understatement!
To top it off, they just recently bought UK startup BeatThatQuote (a price comparison site), to increase their international shopping footprint.
It’s fair to assume that Bing will have to do something in shopping soon. But what?
To keep from falling out of the race entirely, Microsoft should quickly extend its vertical business relationships to include shopping to keep up or even pull ahead of Google…
With Microsoft’s equity/search relationship with Facebook and integration of Facebook social graph in Bing’s search results, finding a shopping search partner that can leverage this would be significant differentiation vs. Google.
A company called TheFind.com offers the most comprehensive shopping index rivaling and maybe even exceeding Google Product Search, with over 450 million product offers from over 500,000 stores.
In addition, TheFind has developed a sophisticated integration with Facebook using Facebook Connect and the open graph. TheFind includes local shopping capability that is really useful on the Web and even more useful for fast growing smart phone using offline shoppers. TheFind also shows matching coupons, and free shipping offers by pulling in data from all of the leading coupon sites over the Web like Retail Me Not, Savings.com and others.
Similar to how Bing wants to use Kayak in order to show more options to users, thefind.com can do the same for Bing on the shopping side – finding every product Bing shoppers may be looking for and from all of the stores that sell them, along with deals and coupons, and showing you the local places to buy them.
Besides thefind.com, I always like milo.com. However, eBay recently bought the company and I wish Microsoft would have gotten into that deal. Their product is compelling and unique and would have been a nice addition to Bing. However, there are other shopping companies that Microsoft can still look at for a deal. For example:
PowerReviews – provides consumer reviews (Google has already done a deal with them)
Polyvore – helps pull together user content around fashion (great way to deal with BOUTIQUES from Google)
Twenga – International, especially for fast growing economies like Brazil and Eastern Europe. This could offset Google’s international shopping ambitions.
What about Local?
Again, Google has been doing a lot of work in Local. From trying to buy Yelp, Groupon, and then deciding to launch their own version of Groupon, and doing more work on aggregating reviews from Yelp and other review sites.
The obvious company that comes to mind here is a Yelp. However, I don’t see that much value for Microsoft doing a deal with Yelp. Will it really help consumers make the right decision? If Yelp was exclusive on Bing, I would prefer Google for local since I know they have combined reviews from multiple review sites. Furthermore, Yelp is not a cash cow like Groupon. There is not much in terms of financial gain for Microsoft in this play. From the Kayak deal, Microsoft not only wants a better experience for consumers, but also a partner that can bring significant revenue for Microsoft.
At the same time. I would not do a deal with Groupon or any other deal site – that’s not search. Instead, I think a partnership with a company like Yipit or another deal aggregator makes more sense.
What would be better than being able to go to Bing to final all the local deals in your area from dozens of deal sites and deciding which one you want. Now, that’s a decision engine.
Yipit is the clear leader in this space today. They have a broad reach of partnerships with deal sites, and have done the best job of creating a slick UI. Yipit is still young, so I would not be surprised if Microsoft decided to buy Yipit and quickly integrate it into their local search product. It’s a smart acquisition that could give Bing a nice shot in the arm. Not only would it create a valuable user experience for Bing users, but the economics of Yipit (they get paid every time a sale is made on the deal site) make it possible for Microsoft to have revenue coming in day one from such a deal.
Health is a tough one to say the least. It feels like people have been trying one thing or another on the web in health since 1996, and with no serious traction.
However, I recently came across a vertical search in health that actually made sense! Take a look at www.zocdoc.com when you get a chance. If you’re ever in a position to have to find a new doctor, dentist or other medical provider, you know how stressful the process can be. First you have to know if they are covered by your plan. Then, how do you know if they are any good? ZocDoc covers both of these pain points. I went to it last night, found a dentist that was in my network who had the best community reviews on ZocDoc. I made an appointment right on the site and today I went in for a cleaning! How easy is that! And the dentist was as good as billed on the site. To me, this is a great example of a vertical search engine that solves a problem that lots of consumers have. ZocDoc gets a referral fee / subscription from every doctor they are able to successfully book an appointment for. I can see this being a great tool within Bing.
Photo: Associated Press
In conclusionMicrosoft’s deal with Kayak shows three things.
1 – Bing wants to partner with best of breed vertical search engines
2 – Bing wants partners who can increase choice and user experience for consumers
3 – Bing wants partners who can bring revenue to the table (Kayak will probably pay Microsoft a decent penny for every conversion that happens via Bing Travel)
If that is the criteria, I think TheFind, Yipit, and ZocDoc make a lot of sense for Bing to go after next.