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Internet Search Engines Generate Donations As Well As Hits

Posted on: Wednesday, 28 December 2005, 09:00 CST

By Bob Tedeschi

Bill Gates made news this month when he said Microsoft's MSN search engine might give away cash or software to get people to use the site. Actually, Yahoo and Google are already exploring that ground, although they are relying on other companies to do it for them.

Like many other Web sites, a pair of online newcomers, Blingo and GoodSearch, license search technology from Google and Yahoo and earn a commission from the major search companies for any ads visitors click on when they are on Blingo.com or GoodSearch.com. (Those ads are, like the search results, generated by Google and Yahoo.) Unlike other sites, though, both Blingo and GoodSearch give away portions of their revenue as prizes or as donations to users' favorite charities.

The businesses stop short of handing cash to users who may be tempted to sit at home clicking on ad links between naps. Blingo randomly gives away iPods, PlayStation game consoles and other items, while GoodSearch sends donations to schools and nonprofit groups on the user's behalf.

But these approaches replicate, at least partly, Gates's idea.

Search engines collect up to $50 each time somebody clicks on an ad next to the search results sometimes even more, if the pitch is for products like certain financial or legal services and sharing some of that wealth not only would make users happy, it would also presumably dissuade them from straying to the search services of another company.

"This isn't as crazy as it sounds," said Rich LeFurgy, a principal at Archer, a San Francisco consulting firm that specializes in marketing. "I think of it as the business model that's waiting to happen."

GoodSearch, which is based in Los Angeles and uses Yahoo's search technology, started down this road in November. Each time someone searches, GoodSearch gives half of the advertising revenue it earns to the user's charity or school of choice.

Only some of the people who search actually click on an advertisement and thus generate income for the site, so the company averages only about 2 cents in revenue for each search conducted. By that math, a charity with 1,000 supporters using the site twice a day would receive about $7,300 in total donations annually.

GoodSearch users need not worry about the site collecting potentially sensitive information about their charitable endeavors, because the company does not require users to register or otherwise identify themselves. Rather, the site's visitors specify a beneficiary before they search, and the site designates an anonymous donation for that search.

To verify the company's claims about its donations, Ken Ramberg, the chief executive, said GoodSearch would submit its books to an auditor and post the results on the site.

Neither Ramberg nor Yahoo would disclose the terms of their deal, and Google also declined to comment on its foray into this market. Ramberg declined to say how much GoodSearch had given away so far. "The beauty of this is obvious," he said. "This money is being raised by people who are doing something they do every day: search the Internet."

LeFurgy, of Archer, noted that online businesses often share commissions with other companies that send them business.

Some of them, like Ebates.com, return a share of that commission to consumers who buy goods online through the site. The idea has not yet extended to the far more lucrative world of online search advertising, though.

"There might be a short-term revenue hit, but this can be a very powerful loyalty tool, which is especially important now because we're in a market-share game," LeFurgy said.

According to Forrester Research, Google continues to dominate the market, increasing its share from 31 percent to 41 percent of all searches in the last two years. Yahoo is holding steady in second place, with about 20 percent of all searches. MSN dropped to 15 percent this year, from 18 percent last year.

Blingo.com is helping Google attract searchers it did not disclose how many by giving away prizes at random moments during the day to consumers who use the site to search through Google's database.

The site, which is based in Mill Valley, California, uses an algorithm to determine when a prize is due to be awarded, then posts a message on the screen to the user who happens to be searching at that moment, telling what has been won and how to collect it.

Source: International Herald Tribune

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