Microsoft offers cashback to lure customers from Google


22 May 2008

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Can paying people to use your service be considered a ‘business model’? Bill Gates certainly seems to think so as Microsoft is offering cash rebates to customers who find and buy products through the search engine’s new Live Search cashback feature.

Live Search cashback is a product comparison site modelled on www.jellyfish.com, which Microsoft acquired last year.

More than 10 million product offers from over 700 merchants are included in the scheme. Partners include eBay, Barnes & Noble.com, Overstock.com, Sears, Zappos.com and WPP.

For now, this is only available to US customers who can claim money back as soon as their cashback account has reached US$5 in value.

Microsoft may be a giant in the software world but its Live Search is a distant third to Google and Yahoo!, who dominate the search and online advertising space.

Gates hopes this cashback feature will “make Live Search the most rewarding commercial search destination on the web”, but its debatable whether this will make any headway alongside Google’s mammoth, well-established search presence.

Additionally, there is also a travel search and comparison sister site called Live Search Farecast.

While this marks a new effort on Microsoft’s part to compete with Google, there are also rumours that the Redmond-based company will seal a deal with Yahoo! for its search services before the week is out, which would give much needed strength to Live Search.

Gates said the future of search lay in expanding its role around the set of tasks that searching is working to accomplish, such as commerce, entertainment, navigation and reference, as well as innovating in the economic model of the search business by incentivising advertisers and consumers for engagement.

By Marie Boran and Niall Byrne