May 28, 2008 | Wednesday

Bill Gates wagers on search and display

By Jackie Danicki - Blogger in Display |Marketing |PPC |Search Engines |Google |Microsoft |Search Technology

You make these bets and you stick with them for more than five years. You bet on graphics interface, you bet on Internet browsing. Here with search, we believe that we can take it and embed it in a broader experience.

He may believe that, but is it wise for Microsoft to bet on it?

Some say that MSFT should concentrate its efforts on display ads, which even Google CEO Eric Schmidt admits is an area not dominated by his company. Not yet, anyway: Google is pouring its resources into display as a major strategic priority, especially if you consider the DoubleClick and YouTube acquisitions. As CNN points out:

According to eMarketer, the U.S. search ad market is expected to double to $19 billion by 2012 while the display ad market, which also includes videos and rich media, is projected to triple to $18.7 billion.

While some pundits claim that the display market has the same potential as the search market, I remain unconvinced of that. While display certainly has its place for now, online users are not becoming more open to intrusive or interruptive marketing tactics. At the same time, users are also becoming more accustomed to actual content as a replacement for traditional advertising. That is to say, companies providing valuable and relevant information instead of an amplification of a generic message.

This puts me in the awkward position of being in disagreement with Bill Gates, who claims:

A pure keyword search has its limits. People want refinement. When a search doesn’t work, they want to know how they can go to that next step.

This may be true, but I do not think display advertising can meet that need - not in its present form, at least. The company that figures out that one really will have a licence to print money.