September 10, 2001 6:50 PM PDT
GoTo gambles with new name
The top paid-listing search service says it expects to spend "less than $1 million" in the next six months to publicize the new name. The company will officially change its name Oct. 8.
The move, first announced nearly a year ago, is meant to broaden the company's reach and alter its image from a destination site to a licensed search service. Search services make up 95 percent of the company's business.
The new moniker will also let the company step out of a group of businesses with the word "Go" in their titles, among them Go2Net, Go2 Systems and the Walt Disney-owned Go.
The change comes at a pivotal time for the Pasadena, Calif.-based company, which has been enjoying success as one of the few dot-coms gaining weight in revenues. This year, it completed three consecutive quarters of 30 percent revenue growth, reported second-quarter earnings that surpassed expectations, and said it expects to become profitable.
Its positive performance has raised its profile among ad-dependent search services as many look for ways to diversify revenue to survive the online ad bust and overall economic downturn. Many major search services have adopted paid-listing models following GoTo's success.
With such positive momentum, some industry watchers say a name change could undermine GoTo's brand notoriety.
"To some degree they are going to be giving up this brand identity," said Danny Sullivan, editor of online trade publication and newsletter Search Engine Watch. "At the time that they were thinking of doing it, they didn't have the brand that they do now.
"I could see some people saying, 'I finally figured out where to buy pay-for-performance search listings.' That could cost them a bit," said Sullivan. On the flip side, publicity for the name change could raise the company's brand identity with those unfamiliar with it, he said.
Jaynie Studenmund, chief operating officer for Overture, said the company hopes to capitalize on its affiliations with major portals to promote the new name, negating the need to build a brand name the way a consumer search service would. The new name, she said, connotes "a pathway or introduction" to a search service, rather than a destination for consumers.
The company, which delivers 2 billion search queries a month, plans to expand internationally, and the new name will help it stand apart abroad, Studenmund said. Overture will promote the new name via direct mail, print advertising and outreach to the financial community.
The company has slowly been paving the way for its name change. In April, it sold rights to the domain name Go2.com to Go2 Systems, a wireless location-based directory and information services format. It also plans to shed the GoTo domain name in the beginning of next year.
The move also comes as concerns swirl around the use of paid-listing searches. The company bases its rankings not on independent measures of relevance but on relevant advertisers who pay for top billing. Although it makes its commercial relationships clear on its own Web site, the paid listings are not always clearly disclosed by its growing list of distribution partners, which include companies such as AltaVista, AOL Time Warner's America Online and News.com publisher CNET Networks. This has prompted a consumer advocacy group to file a complaint with the Federal Trade Commission.