Microsoft’s Cashback Program is Slow to Produce Results

Posted 08/30/2008 at 1:48pm | by Justin Kerr

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Microsoft’s quest for online dominance it would seem, will take more than just cash to realize. The aborted Yahoo deal was but a small part of a multifaceted approach towards capturing long term search engine market share, the most lucrative of which involves e-commerce. For those who can’t remember back that far, on May 21st 2008

Microsoft announced plans to offer consumers cash back for transactions with select e-retailers which were found using the Live search engine.  The comScore US market share results show a slight increase after the first month which represents a boost of about 0.7%. But July’s results saw the search engine give back 0.3% to its competitors. Even though the promotion has only been running for about two months, tech critics seem to think the idea is already running out of steam and express doubt that it will have any meaningful long term gains. It remains to be seen if Microsoft will continue the program as it may see any gain in market share to be a success. This seems even more likely when you consider how slowly search engine market share moves these days. To put it in perspective, during the same two month period Google’s market share rose only 0.1% to 61.8% and Yahoo dropped, but only by 0.1% to 20.5%. According to eMarketer Inc., U.S. online retail sales are projected to grow to about $335 billion by the year 2012. Even today, 68 percent of all online transactions began through a search engine.

Do you think Microsoft can make a comeback with cashback? Click the jump and let us know.