In a bid to compete with its larger rivals in the paid-keyword search category, FindWhat.com is looking to entice portals and search engines with a private-label version.
The new service by the New York-based FindWhat.com comes as providers of paid-keyword search listings increasingly compete in the search for distribution partners, and as search engines mull putting together their own such offering.
Yahoo, for one, had been thinking of offering its own version earlier this year but decided to stick with the services of Overture , the leader in the category.
Google also moved closer to Overture’s cost-per-click (CPC) model when it began offering paid-keyword searches to advertisers earlier this year.
Craig Pisaris-Henderson, FindWhat.com’s chief executive, said the thinking behind the private-label service is to capitalize on the interest by top tier portals to increase their paid-listing revenues and maintain a direct relationship with their advertisers.
So far, FindWhat’s only customer is Terra Lycos , which unveiled its plans in August to private label the service for its Lycos and HotBot search engines. That Terra Lycos would roll out its own paid-keyword search offerings is yet another competitive response to Overture’s success with its paid-search listings.
Henderson said the strategy with private-labeling is to give the portals what they want: a way to increase paid-search advertising revenues and maintain relationships with advertisers directly instead of linking out to third parties’ search results.
With its deal with Lycos, for example, Lycos negotiates directly with advertisers and gets to keep the revenues instead of splitting them with other providers such as it currently does with Overture, which Lycos and Hotbot also use. With private-labeled search listings, however, FindWhat.com gets a smaller percentage of the search results and provides back-end technical assistance to the search engine company.
“With our operational expertise, we can provide them with the opportunity to benefit from the power of their brands to create their own, high-demand, performance-based paid ad service, which also can lead to additional cross-selling opportunities and new revenue streams,” Henderson said.
Still, Henderson concedes that it may be only a matter of time before Overture and others in the category roll out their own private label offering in response. But at least FindWhat.com has a head start in rolling out the category, he said, as well as a way to compete by offering the services to smaller search engines and portals that may not be able to afford the bigger search listings providers.
