Microsoft Tries Buying Search Loyalty

As technology doesn't seem to be helping Microsoft in the search engine wars, the firm is resorting to a tactic that predates computing itself: bribery.

Registered users of Live.com will be paid every time they visit a dedicated 'Live Search cashback' site, click on a search result to a participating website and then make a purchase. The amount they'll 'earn' will be a portion of the sale price set by the retailer and, once the user has racked up $5, they'll be paid through Paypal, online bank account, or check. (Source: bbc.co.uk)

In most cases, customers will earn money for every product they buy at the linked site, not just the item they originally searched for. However, the percentage they'll get back may vary from product to product. (Source: live.com)

It's not yet clear exactly who will be forking up the cash, but it appears likely it will be split between Microsoft and the advertiser. From the information Microsoft has released, it seems the advertisers using this scheme will only have to pay when somebody makes a purchase. This differs from Google's system where advertisers must pay every time a user clicks on an advert.

Microsoft already has some big names signed up to the scheme, including Barnes & Noble, Circuit City, and Home Depot.

Rob Hof of Business Week points out that the scheme is particularly attractive for advertisers: there's less risk of wasting money on ineffective advertising when site visitors don't buy anything. However successful the system is, advertisers will be glad to see Google get more competition. (Source: businessweek.com)

Still, there could be problems at the consumer end. To benefit from the service, users must sign up for an account (including handing over payment details to Microsoft), make sure to use the 'Live Search cashback' site when buying online, and then wait for payment.

That sounds like a lot of hassle for what may well be a small rebate. Customers will still want to search elsewhere to see if they can get an item at a price that's lower even taking into account the cash back offer. In addition, the system assumes online buyers will log on with the specific intention of buying a particular item, which anyone who's used Amazon's 1-Click after a couple of beers will know is rarely the case.