We’ve been following the Microsoft, Yahoo! Search dance for some time now. Yesterday, Kara Swisher posted that we might finally be close to an advertising deal between the #2 (Yahoo!) and #3 (Bing) players in search.
While given previous false alarms on this topic, I’m not holding my breath. However, I thought it would be interesting to analyze this deal from the perspective of advertising efficiency. In the past, the three major engines had very different demographic make-ups. The screen-shot below is an age comparison of visitors to MSN Search compared with visitors to Yahoo! Search one year ago (four weeks ending 7/12/08).

You can see the clear age difference between the two, with Yahoo! skewing towards the younger searcher, and MSN Search – older. Demographic distance between the two properties could be an important factor in understanding how well Yahoo! Search ad inventory would sell on MSN Search (now Bing). Fast forward to current data as of last week:

When comparing Bing to Yahoo! Search their appears to be a closer demographic fit which should yield more search advertising sales efficiencies. Finally, the homogeneity of search behavior is becoming evident in where searchers click-off to when executing a search. In the past, searches on the different engines showed very different downstream industries. The table below indicates that search behavior now looks strikingly similar between the two:

If Swisher is right and we’re close to Microsoft and Yahoo! joining forces, the similarity in demographics and behavior should bode well for the relationship.