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Forums - PC - Bing continues to grow in the US with January's numbers looking green

dsgrue3 said:
disolitude said:
dsgrue3 said:
disolitude said:
See post to timmah here. We aren't talking volumetric increases.




Yeah I knew all along thats what you're talking about.

I also knew its not a correct number to look at when calculating month to month revenue increase.

You're saying that Bing generated 19.5 million X your magic and wrong CPC formula extra revenue in January which is incorrect. Its 358 million X magic formula which you still need to work on. 

I'm not discussing revenue from a volumetric increase, I'm discussing revenue from a market share increase - only relevant thing to discuss since this thread is about market share not volumetric increase in searches. I mean it's in the OP.

As for you saying I'm wrong, here's some more charts to assert my position:

Click through rates = what portion of searches are CPC...and CPC average rate:

Looks like $0.40 was low for Bing, $0.66. Using new numbers for January using above rates:

19.5m (search proportion of 0.1% market share increase) * 0.0161 (CPC portion) = 313,950. And at $0.66 per = $207,207

Volumetric just for fun:

358m * 0.0161 = 5,763,800 * $0.66 = $3,804,108 - pretty abysmal when they lose over $130m/month.


You can find all kinds of CPC stats out there tracked by different companies...including Kenshoo Inc. There are lots of companies run a sample of 1000 word bidding on search engines and then post the cost it took to buy them. Then they post their findings. They really don't represent the full picture though.

But appart from giving you my Google AdWords and Analytics login, there is not much I can do to show you that average CPC rates for Google. It may be because I am in Canada but CPC for Bing and Google over here is well over a dollar.

Essentially you need a login for this to see how much each word costs - https://adwords.google.com/o/Targeting/Explorer?__c=1000000000&__u=1000000000&ideaRequestType=KEYWORD_IDEAS

And yeah, according to my math, bing made extra 10 million in search revenue in January compared to December. It's true that Bing is still losing money but they have lowered their losses every quarter for the last 2 years. The Yahoo deal is what's making them lose money. They pay yahoo 90 cents for every dollar their search generates while having to fully power their search with Bing. 

The way search works is that the higher your user reach, the better search data you provide, so this is money well spent for Microsoft as they are doubling their pool of search inventory through Yahoo. They are also growing marketshare faster than Yahoo. Even with Yahoo they will be profitable in a year or so, however without yahoo on their back, they are most likely already profitable today with Bing alone.



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timmah said:

Yes, but he was talking about revenue, which is not directly related to market share. Volume is directly related to revenue in this case, so it was valid for him to bring volume up when discussing revenue (even if the original article is primarily about market share). Market share is only a comparison to competitors, so cannot be used by itself in an equation to determine revenue.

It's similar to people coming into a discussion about CPU clock rate and saying something like 'clock rate isn't the only factor in determining speed', then going on to talk about cache, hyperthreading, or architecture. He's expanding the discussion beyond just market share so he can discuss revenue effectively.

Huh? Market share is absolutely directly related to revenue. Market share * total searches = # of searches * CTR*CPC = Revenue.

You missed the argument, so I'll summarize for you:

Me: LOL MS spin about 0.1% market share increase from Google.

Disol: If you knew how much money 400 million extra searches per month can generate (0.1% marketshare), you'd realise how foolish your post is.

^^^ this is an issue as 0.1% market share is not 400 million searches - this is where he deviates from my argument which is why I was so confused about his math. From here he attempts to argue for total volume increase probably because he realized he mispoke but rather than admitting it he went off on a tangent to support his number.

Me/Him: Just some dick-measuring. Not vital to this really lol.

Me: Reiterate 0.1% market share, do math to show revenue.

Disol: Goes back to his volume point randomly in response to my math claims it's wrong.

etc.

I think you understand now.




I prefer to use marketshare and revenue growth as metrics, bc profitability will be there if these other two are doing good (and is a decently run company but almost all companies do well with cost control anyway).

I prefer ycharts revenue year over year calculated growth, as well as profit, bc Looking at things on a quarter to quarter basis is too short term of a view to make a valid analysis of a company even for gaming forum purposes.



disolitude said:


You can find all kinds of CPC stats out there tracked by different companies...including Kenshoo Inc. There are lots of companies run a sample of 1000 word bidding on search engines and then post the cost it took to buy them. Then they post their findings. They really don't represent the full picture though.

But appart from giving you my Google AdWords and Analytics login, there is not much I can do to show you that average CPC rates for Google. It may be because I am in Canada but CPC for Bing and Google over here is well over a dollar.

Essentially you need a login for this to see how much each word costs - https://adwords.google.com/o/Targeting/Explorer?__c=1000000000&__u=1000000000&ideaRequestType=KEYWORD_IDEAS

And yeah, according to my math, bing made extra 10 million in search revenue in January compared to December. It's true that Bing is still losing money but they have lowered their losses every quarter for the last 2 years. The Yahoo deal is what's making them lose money. They pay yahoo 90 cents for every dollar their search generates while having to fully power their search with Bing. 

The way search works is that the higher your user reach, the better search data you provide, so this is money well spent for Microsoft as they are doubling their pool of search inventory through Yahoo. They are also growing marketshare faster than Yahoo. Even with Yahoo they will be profitable in a year or so, however without yahoo on their back, they are most likely already profitable today with Bing alone.

Well, all I see is myself posting sources for my data and you posting nothing. I've yet to come across any source that cites an average CPC rate over $1.02. The last source posted that you quoted is a paid survey, so I think it's probably more credible than most.

Market share is what you battle for - a volumetric increase in the market itself isn't gaining anything from the competitors. 

Bing losses are Bing losses alone, they do not include Yahoo losses.



dsgrue3 said:
timmah said:

Yes, but he was talking about revenue, which is not directly related to market share. Volume is directly related to revenue in this case, so it was valid for him to bring volume up when discussing revenue (even if the original article is primarily about market share). Market share is only a comparison to competitors, so cannot be used by itself in an equation to determine revenue.

It's similar to people coming into a discussion about CPU clock rate and saying something like 'clock rate isn't the only factor in determining speed', then going on to talk about cache, hyperthreading, or architecture. He's expanding the discussion beyond just market share so he can discuss revenue effectively.

Huh? Market share is absolutely directly related to revenue. Market share * total searches = # of searches * CTR*CPC = Revenue.

You missed the argument, so I'll summarize for you:

Me: LOL MS spin about 0.1% market share increase from Google.

Disol: If you knew how much money 400 million extra searches per month can generate (0.1% marketshare), you'd realise how foolish your post is.

^^^ this is an issue as 0.1% market share is not 400 million searches - this is where he deviates from my argument which is why I was so confused about his math. From here he attempts to argue for total volume increase probably because he realized he mispoke but rather than admitting it he went off on a tangent to support his number.

Me/Him: Just some dick-measuring. Not vital to this really lol.

Me: Reiterate 0.1% market share, do math to show revenue.

Disol: Goes back to his volume point randomly in response to my math claims it's wrong.

etc.

I think you understand now.



@Bold is factually incorrect because there are other variables to consider, most importantly the change in the size of the overall market in this case.

It's actually closer to 350 million more searches vs. the previous sample. A large percentage of the volume increase is just due to keeping up with overall market growth. They'd have to gain a lot of search volume overall just to stay at their current market share percentage since the market grew. Revenue is not directly related to market share unless the market size is completely stagnent (0 growth, 0 loss in the overall size of the market) and prices are completely stagnent, neither of these variables are static, so maket share by itself is not directly related to the overall revenue of the entity. This is business 101.

Presenting a hypothetical - If all search engines saw an eqaul gain of 10% in overall searches while click through rates stay the same, there would be a 0% change in market share (as they all grew at the same rate due to market expansion), but 10% higher volume & revenues for every provider. The pie overall gets bigger, but each piece of the pie stays at the same percentage/ratio of the overall pie, meaning each pie slice grows in size overall, but not in relation to the other slices. It is important to understand that market share is a relational figure only, meaning other variables are necessary to determine revenue, total growth/loss, or size. In this hypothetical instance we would have 10% search volume (overall market) growth, 0% market share growth for each entity, and 10% revenue growth across the board. Market share is clearly not in direct relation to revenue or overall growth due to the other variables. This is why you can see 12% search volume growth with only a 0.1% market share growth, and revenue growth much larger than market share growth.

"As the total market for a product or service grows, a company that is maintaining its market share is growing revenues at the same rate as the total market."

Read more: http://www.investopedia.com/terms/m/marketshare.asp#ixzz2KzPFZhOD

As you can see from above, a company can grow revenue while maintaining market share (0% market share growth while seeing revenue growth). If one number can stay the same, while the other number grows, the two numbers cannot be directly related mathematically speaking.

A relationship between two numbers or other variables where an increase or decrease in one variable causes the same change to occur in the second variable.

Read more: http://www.investorwords.com/6791/direct_relationship.html#ixzz2KzPurpqy

Since it is possible for revenue to grow while market share stays the same, for market share to drop and revenue to go up, for market share to go up and revenue to go down, or for each number to go up or down at different rates (all due to the all-important 'other variables' in business), there is absolutely no case to be made that market share is directly related to revenue.



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dsgrue3 said:
disolitude said:


You can find all kinds of CPC stats out there tracked by different companies...including Kenshoo Inc. There are lots of companies run a sample of 1000 word bidding on search engines and then post the cost it took to buy them. Then they post their findings. They really don't represent the full picture though.

But appart from giving you my Google AdWords and Analytics login, there is not much I can do to show you that average CPC rates for Google. It may be because I am in Canada but CPC for Bing and Google over here is well over a dollar.

Essentially you need a login for this to see how much each word costs - https://adwords.google.com/o/Targeting/Explorer?__c=1000000000&__u=1000000000&ideaRequestType=KEYWORD_IDEAS

And yeah, according to my math, bing made extra 10 million in search revenue in January compared to December. It's true that Bing is still losing money but they have lowered their losses every quarter for the last 2 years. The Yahoo deal is what's making them lose money. They pay yahoo 90 cents for every dollar their search generates while having to fully power their search with Bing. 

The way search works is that the higher your user reach, the better search data you provide, so this is money well spent for Microsoft as they are doubling their pool of search inventory through Yahoo. They are also growing marketshare faster than Yahoo. Even with Yahoo they will be profitable in a year or so, however without yahoo on their back, they are most likely already profitable today with Bing alone.

Well, all I see is myself posting sources for my data and you posting nothing. I've yet to come across any source that cites an average CPC rate over $1.02. The last source posted that you quoted is a paid survey, so I think it's probably more credible than most.

Market share is what you battle for - a volumetric increase in the market itself isn't gaining anything from the competitors. 

Bing losses are Bing losses alone, they do not include Yahoo losses.


Bing losses include the cost of operation that is occured by operating Yahoo's search engine. Yahoo uses Bing and takes 90% of the search revenue. You think 10% search revenue off 12% total US search traffic isn't generating a loss for Microsoft?

It's next to impossible to find out the exact CPC average so there is no point of researching different surveys and posting links found on the internetz. The best you can do estimate based on financials.

For example, here is a "link" which seems to be what you're looking for - http://thenextweb.com/insider/2013/01/25/microsoft-5/

"Online advertising revenue grew $109 million or 15% to $823 million, reflecting continued growth in search advertising revenue, offset in part by decreased display advertising revenue. [...]"

Looking at Q12013 to Q22013 search revenue is jumped around 120-150 million since we all know display advertising is on a downwards trend. (109 million + the revenue display advertising lost). 

Lets take $130 as the safe bet.

So make CPC average an X and take $130 million and plug it in to your formula, using the number of extra searches Bing performed from Q1 to Q2 and you will get an estimated CPC average.

It's not a perfect formula but it's gonna be way more accurate than some 3rd party survey. 



pezus said:
pezus said:
I wonder how people will say this is an accomplishment and if they are the same people detracting from Android's marketshare gains in the tablet area.

Emphasizing

Would be interesting to see WW numbers too. I would think Bing numbers are embarassing outside of USA. 


They are pathetic.

They are like 5th largest search engine behind Goolge, Baidu, Yahoo and Yandex, in that order.  The problem is that advertising spending in China, Russia, India and other places which contribute to these numbers is much smaller than North America, UK...etc. So essentially Microsoft just doesn't care.