Commentary - Bing versus Google: So Far Not So Good

In the July 8, 2009 New York Times, David Pogue compares Microsoft’s new search engine Bing to Google. He describes Microsoft’s history as “Wait until somebody else has a hit. Then copy it.” Is this a good strategic approach for Microsoft? Perhaps, but it is inherently risky because a competitor with a strong competitive advantage may be difficult to overtake.

Pogue looks at the features and benefits of Goggle and Bing and concludes that in many ways Bing is superior to Google and points to www.bing-vs-google.com where you can conduct your own comparison. If this is the case you might expect Microsoft to be making significant gains in market share. In fact Microsoft's share gains are modest rising from 3.3% in April. To 8.23% in June according to the web firm StatCounter in their latest report for June 2009 and compares to Google’s 79% share. 

So why hasn’t Microsoft with its deep market knowledge, strong position in adjacent markets, and big pocket book garnered larger share gains? If Microsoft has achieved minimal market share to date, will the company be more successful in the future? What insight can thoughtful strategy analysis tell us about Microsoft's Bing strategy?From a customer perspective strategy analysis suggests that Microsoft must succeed in three areas if it hopes to achieve a substantial market share and effectively compete with Google. The three areas are:

• Awareness - Creating sufficient buzz and awareness in the market to cause customers to try Bing.
• Value - Providing a compelling experience so that customers value Bing over Google, Yahoo, or other browsers
• Ingrained habits - Breaking usage habits or loyalty to Google, for example, taking Google search function off your browser and putting Bing there instead

The results to date suggest Microsoft has fallen short on all three counts.

First, even with Microsoft making bold efforts to generate awareness with advertising estimated at $80 - $100m, as of June 8, only 7.9% of consumers had heard of Bing though that rose to 25.2% by June 24th according to YouGov’s brand index reported by AdWeek. 

Second, although Microsoft has incorporated new and interesting features into Bing including its cash back feature, the additions don’t appear to be ground breaking or market shaking. Customers’ perceptions of Bing’s value should be dramatically better to cause consumers to switch. While some features are superior to Google according to Pogue, they aren’t of the breakthrough variety that Google made with its entry in to the market.

Third, if Microsoft doesn't succeed in the first two areas consumers who are satisfied or very satisfied with Google and Yahoo aren’t likely to change their habits.  Microsoft faces a difficult challenge with Bing. Time will tell if the company can make real progress in each of these areas but for now the future looks to be a continuation of the past.