GoTo Policy Change

From: Kyle Yamnitz <c598249_at_showme.missouri.edu>
Date: Thu 08 Mar 2001 10:10:29 -0600

I'm not sure how many of you advertise with GoTo.com
and got the message about increased rates, but I
thought I'd take a moment to spark a discussion about it.
Here's a general overview of what GoTo is doing as of
today:

1. Increasing the minimum bid from 1 cent to 5 cents.
2. Increasing the minimum monthly charges from 0 to $20.
3 Allowing current terms to be grandfathered in at
   previous rates, but only until September 1st,
   apparently. New terms must be 5 cents or greater.

        I'm curious as to what your thoughts are on this? Here's
my opinions:
        -- This move really hurts the small businesses on the
Internet like myself who run high quality resources
but cannot afford to pay 5 cents per click. I certainly
will not be remaining with GoTo after September 1st if
the 1 cent bids are no longer allowed. My site is funded
by advertising and I've done the math to determine that
1 cent per click is profitable, but higher isn't likely
to be (on that user's visit - not considering repeat
visits). Thus, small businesses like my own will be
hurt by no longer being listed.
        -- This move likewise decreases the value of the search
engine. The only listings will be from the larger
companies with deeper pockets, yet not necessarily
better sites, and fewer of them. Thus, GoTo won't
be including many of the better Internet resources!
Searchers will go elsewhere when they find sites like
mine on other search engines, but not on GoTo!
        -- Competition will automatically increase prices over
time. Allow competition to do it and you won't experience
upset customers. Also, there will likely be listings
over 5 cents for most of the search terms anyway.
Allowing lower priced terms just lets GoTo make money
from them instead of getting nothing off of the regular
search listings.
        -- I'm sure GoTo is aware of how expensive it is to
gain a new customer, but how cheap it is to keep existing
customers. Well, now GoTo's going to be losing a lot of
customers and finding it a lot more difficult to attract
new customers... I honestly don't see how this move got
past management!

        Granted, 5 cents per click isn't expensive by Internet
advertising standards, but the 1 cent rates allow the
small businesses like my own to be able to advertise and
do a lot of it. 5 cents per click isn't likely to be
affordable for a lot of small businesses, particularly
those that aren't selling anything like myself.

Thoughts? Take care,
        --Kyle Yamnitz
          EdScope, L.L.C.
          Expanding the Scope of Education:
                http://www.EdScope.com



Received on Thu Mar 08 2001 - 10:10:29 CST