The "Real" Numbers Offer Clue to Google's Huge Lead

I've always been a stats junkie. In the search marketing business, though, it hasn't been easy to get the data that matter most. You hear conflicting reports about just how strong competing search engines such as Yahoo, MSN, and Google Search are in the marketplace. For the past year I've been trying hard (in seminars, on this site, as moderator of now-dormant MarketingVox Search, etc.) to hammer home the point that Google's lead in terms of search referrals is greater than it ever was, and greater than you might think.

Never argue with the marketplace.

The argument is a difficult one to have in a context where the Chicken Littles in the biz, typically bored insiders hoping for a shakeup, are always coming up with some reason that the leader is about to take a precipitous dive in popularity. And the average seminar attendee who has not been following the progress of the online metrics agencies since 1998 will require a careful explanation of just what "share of searches" or any number of other "who's in the lead" type stats actually means. That can slow down the momentum of discussing what's really going on out there. I can't tell you how many times I've tried to urge marketers to narrow their focus on a few core online channels, only to have them ignore the data and come away from the presentation vaguely muttering about needing to "get a presence in the search engines, and it's all so complicated..."

But it isn't that complicated. Flawed, subjective approaches to measurement just make it so.

It's definitely important to question methodologies here, and presenting stats from several sources seems paramount. Standard & Poor's, on the way to arriving at a fair valuation for Google of a whopping $33 billion to $40 billion, commissioned a run-of-the-mill survey of 1,000 Internet users in the US and found that Google was used/preferred (which?) by 48%, with Yahoo and MSN "a distant second."

Not bad, since the number matches well with some numbers provided by comScore Networks for the US in April. Depending on which one you look at, that shows Google at 44%, Yahoo at 37%, and MSN a distant third.

Marketers shouldn't believe that number for a second. Last month, when ComScore released Canadian data showing that Google's market share was 61%, it didn't make sense to me that its number was so much lower in the US, and that Yahoo was the cause of that low US market share number for Google.

There is no denying that Yahoo is a very popular and profitable web property, and people are conducting a lot of different kinds of "searches" on there that deserve to be counted, but from a marketer's standpoint it just does not seem as if these are the kinds of searches that actually translate into search referrals to our clients' websites. Ever since Yahoo dropped its directory, and more so with the ascendancy of Google Search, and perhaps even more so after Yahoo dropped Google as its provider of index search, it doesn't seem like Yahoo is referring a lot of searches of the "web search" variety.

Now that the international survey from comScore, based on its qSearch panel-based methodology, is out, the strength of Google in international markets is emphasized even more. The key metric that this survey focuses on is the "share of searches" in a given month. What comScore has done this time around to simplify the measurements is to measure the percentage share of only the top three search destinations. So in the Canadian case, dropping minor players out of the calculation, Google now clocks in at 70%, with Yahoo trailing badly at 17%. It's tough to sugar-coat a disparity that wide. Frankly it does not bode well for Yahoo. Endlessly-touted vaporware by MSN Search has yet to materialize, so perhaps appropriately, it languishes at 13%.

Like AOL, both Yahoo and MSN have attempted to muscle their way into users' consciousness by making deals with major domestic portals & ISP's. Recently for example, Sympatico and MSN co-launched a Canadian "super portal" initiative with a well-publicized launch announcement at a downtown Toronto furniture store, with the side theme being the "wired home." Few journalists understood the point; page after page of full-color newspaper ads far outstripped the column inches devoted to the dubious "launch." It's fair to say you could count the number of interested users on two hands. The face-saver for the two companies in the deal can always be the fact that anyone subscribing to Sympatico's DSL service and using Hotmail can technically be counted as someone taking advantage of the dubious "super portal" bundle.

Meanwhile, Google spends $0 on advertising, and has a 70% market share in Canada. (Seth Godin must be smiling. His latest book, Free Prize Inside, emphasizes the fact that delighting consumers is the way to win over markets, and that expensive marketing campaigns rarely work today.)

Plus -- again according to the recent release by comScore based on its qSearch survey -- Google's share of searches in France is 80% (10% Yahoo, 10% MSN); and 77% in the UK (14% Yahoo, 9% MSN). And that leaves dozens of large markets without accurate share-of-searches measurements for us to assess, but clearly, most of them are going to show Google well over 50%. This massive popularity points to a real opportunity and hints at some real challenges that will face Google as it grows into its role as a maturing international company. But above all, contrary to what you might have been told, it shows that portals like Yahoo, MSN, and AOL have an uphill climb if they're to convince significant numbers of users to use them for their daily search engine needs.

Worse news for the established portal players is that Google has now signaled its willingness to fight for market share in web-based email. GMail is currently growing virally with no need for advertising. What might be around the corner?

Andrew Goodman is Editor-at-Large of Traffick.com and the author of "Winning Results with Google Adwords".