Report: Search Engine Wars Heating Up

The search engine wars are heating up, with Google joining Yahoo! (Nasdaq: YHOO) and MSN as leaders in the race for control of this important Web sector, according to a report released by Nielsen//NetRatings (Nasdaq: NTRT).

In its February traffic data report issued Thursday, Nielsen//NetRatings said Yahoo! Search attracted more than 35 million visitors in February, followed closely by MSN with 32 million and Google with 27 million. AOL clocked 24 million surfers and Ask Jeeves was fifth with 11 million.

Nielsen//NetRatings director and chief e-commerce analyst told the E-Commerce Times that search engines are becoming an integral part of online marketing campaigns, along with traditional banner ads.

“It’s become apparent to us that search is an important part of an overall Web strategy,” Strand said. In fact, she added, search engines tend to be favored over index sites such as Yahoo! by more experienced Web users.

Paid Listings A-OK

That trend toward search and away from indexing is borne out by the rise of Google, Strand said, noting that Google offers search exclusively.

She also said Web users do not appear to be deterred from using a search engine based on whether it uses paid listings in an effort to achieve profitability.

“I think people know it’s necessary,” she said. “The funds that keep the search engines running have to come from somewhere.”

For instance, Yahoo! has begun to include paid listings in its search results, a move pioneered by Overture.com.

“Search engines continue to be the ‘go to’ destination on the Web, with new features and services being added on a regular basis,” Strand said. “As fee-based services are gradually incorporated, competition between the various search engines intensifies.”

On the Way Up

Although Google ranked third in terms of traffic, it powered well past the competition in terms of length of time spent using the search engine. Surfers logged an average of 26 minutes on Google, compared with 11 minutes on AskJeeves, 10 minutes on AOL, nine minutes on Yahoo! and eight minutes on MSN.

Google has been growing rapidly, ranking as one of the top three gainers in NetRatings’ January rankings.

Morningstar.com IPO analyst George Nichols told the E-Commerce Times that investors anticipate the site, which is reportedly already profitable, could have its much-anticipated IPO sometime this year.

“People are watching that one closely,” Nichols said. “There has been talk about it coming out for a while.”

Divide and Conquer

Nielsen//NetRatings also published the first edition of its new category rankings, using February traffic to illustrate Web use in several key shopping categories.

Among overall online shopping destinations, Amazon finished comfortably in the lead with an audience of 30 million, followed by Yahoo! Shopping with 25 million, eBay with 23 million, MSN’s Eshop with 9 million, and comparison shopping site Dealtime with about 5.6 million.

Expedia took top honors among travel sites in February, followed closely by Travelocity (8.2 million) and Orbitz (5.7 million). AOL Travel and Priceline.com rounded out the top five with about 3.3 million visitors each during the month.

Rank and File

In the apparel and beauty category, VictoriasSecret.com finished ahead of fellow lingerie site Fredericks.com and mainstream brands OldNavy.com, Gap.com and EddieBauer.com.

In the automotive category, eBay (Nasdaq: EBAY) Motors finished a surprising second to KelleyBlueBook.com. Also in the top five were AutoTrader.com, MSN Carpoint and Edmunds.com.

Hewlett Packard (NYSE: HWP) took the top spot in the computer hardware category, followed by Dell (Nasdaq: DELL), Apple (Nasdaq: AAPL), Compaq (NYSE: CPQ) and Gateway.

Yahoo! captured top rankings in the finance and investment category, with its Finance channel ranking ahead of Quicken.com, MSN Money, Intuit.com and PayPal (NYSE: PYPL).

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