November 1, 2001, 12:00 AM

Searching high and low

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Greater complexity

FindWhat provides optimization services in addition to offering pay for placement in search results, but while its pay-for-placement business has grown to include more than 10,000 clients, its optimization business has dwindled to 100. “The algorithms are becoming much more complex,” says FindWhat CEO Craig Pisaris-Henderson. “The second you figure it out, they change. It’s labor-intensive to stay ahead of it, so to make money, search engine optimization providers have to be selective in who they work with. There’s only so much you can do for some companies with optimization.”

Maybe that’s why, as competition online continues to rise, Jupiter’s Gluck describes pay-for-placement as “a win for consumers, retailers and search engines. It aligns the interests of all of them.” Retailers get qualified customers; consumers get relevant results because retailers don’t pay for keywords that don’t produce sales. And since the search engines are paid only on a performance basis, that’s fine with them.

Under pressure to produce new revenue streams, more search engines will look to variations on pay for placement or pay for expedited review as they seek ways to monetize their search technology, predicts Gluck. “The pay for placement model on search engines has definitely taken off just in the past year,” she says. “It’s gained acceptance by delivering relevant results. Consumers have shown they don’t really care whether search results are paid for. They care far more about whether they’re relevant, and they’ll use whatever search engine gives them the most relevant results.”

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