Microsoft Adcentre
It was a strong showing for Microsoft as Comscore’s May 2007 rankings for search engine market share gave Microsoft the third spot with 10.3 % market share even though it was a late arrival to search engine advertising. The search engine advertising was huge and growing and with the expertise of Microsoft in software design along with top properties such as MSN and Windows Live where text as well as display ads could be advertised, gave Microsoft a natural opportunity to increase its revenue as well as market share.
Till May 2006 Microsoft used to syndicate ads from Yahoo Overture which recruited advertisers, sold ads and tracked clicks on MSN search. In-return, Microsoft got a share in the ad revenues. But later in 2006 Microsoft turned to its own system: Adcentre, which helped develop a direct relation with its advertisers along with the option to customize beyond the functions provided by advertising systems for e.g. Demographic targeting etc. Plus with the Adcentre, Microsoft would not have to share profits with a competing search service.
Challenges in front of Microsoft
• Microsoft had a very complicated challenge in how to expand its Adcentre as advertisers were the sole source of revenue. Hence, recruiting more advertisers was the only option for Microsoft. But advertisers needed more publishers while publishers need more advertisers which led to a delinquent problem. Also the cost of creating the ad, selection of the keyword, design, uploading of the ad etc. increased the cost of the advertisers considerably. Thus Microsoft had no other option but to increase traffic by buying ad services from third party publishers, as well as to buy publishers from a highly competitive publisher market to give its adverti ...