Many companies are nervously forecasting weak holiday business and even worse first quarter sales as the economy navigates the recession.
But not all markets are equally dire. One stand out continues to be the online search advertising market.
Microsoft's improved its search ad algorithms, says Christopher Lien
“We’re not seeing a pull back in e-commerce-oriented advertising among our clients,” said Christopher Lien, co-founder and CEO of Marin Software, a developer of software and services for search advertisers. “It surprised us.”
Lien says his customers complain of a lack of visibility in the economy. But most have 2009 search advertising budgets that are flat with this year’s or slightly down. These budgets could change depending on the pace of sales in December, but so far they haven’t, he says.
Longer term, many large advertisers have yet to use search advertising or are just beginning to enter the market. “I remain quite bullish on paid search” over the long term, he said. “I think of paid search as being in the second inning.”
Because of the opportunities in the market, Lien predicts Microsoft will make another pass at Yahoo. Microsoft needs the volume of Yahoo search to better compete with Google – and to capitalize on the improvements it has made in ad conversion rates on MSN/Live Search.
“They’ve really made some strides with their search monetization algorithms,” he said. “I don’t think they get enough credit for it.”
Microsoft offered as much as $33 a share for Yahoo earlier this year and now says it is uninterested in the online portal. Yahoo initially rejected the bid, but now has shown signs it is willing to reconsider.
“I think the personalities need time to settle down,” said Lien.
Posted by Mark Boslet 
