Two months ago, in the first issue of our new Rule Breakers newsletter, I took a look at the various companies hoping to cash in on Google's (NASDAQ:GOOG) online bread and butter of paid search -- coattail riders such as FindWhat.com (NASDAQ:FWHT), Ask Jeeves (NASDAQ:ASKJ), and paid search pioneer Yahoo! (NASDAQ:YHOO). However, if you roll out those coattails a little further, you see that this family tree is actually as big as a redwood with many other public companies looking to cash in on the cost-effective phenomenon of online advertising.
Earlier this year, Jupiter Research predicted that the paid search market will nearly triple to become a $5.5 billion market by 2009. It generated $1.9 billion in sales last year. So let's crash the Google family reunion and single out some of Google's kissing cousins. There are a lot of companies looking to cash in on the growth of curious eyes migrating online. It would be a shame if we didn't make a few introductions.
CNET -- When you're unsure of a domain, it's human nature to type in the most logical dot-com address and give it a go. Yet when it's time to perform a search, why do we go to Yahoo.com, Google.com, or Ask.com instead of trying Search.com? That's what CNET would like to know. It owns that little corner of Internet real estate. The company has had success with some of its other generic domains such as News.com and Download.com, so we can always hold out hope that its simple metasearch portal with the seemingly perfect domain name gains traction.
Then again, maybe the domain is the problem. It's not easy to brand a generic word. That's why booklovers will bypass Books.com to get to Amazon (NASDAQ:AMZN). That's why Auctions.com never stood a chance against eBay (NASDAQ:EBAY). However, CNET is in a pretty cool position because of the vast amount of traffic it generates through its portfolio of content sites. As it continues to integrate its sites together, creating a sticky collection of Web properties, Search.com will continue to grow.
aQuantive -- As you can imagine, companies sometimes need a helping hand in mapping out an Internet marketing strategy, and that's where aQuantive comes in. A product of the merger between Avenue A and SBI.Razorfish, the company saw its June quarter revenues climb by 83% and its earnings more than triple. The wired ad consultants expect to earn between $0.24 and $0.28 a share this year on revenues of roughly $150 million. With three straight years of growing its quarterly profits, and given the effective advertising platform that the Internet has become, business should continue to grow briskly.
ValueClick (NASDAQ:VCLK) -- Along with DoubleClick, which is in mid-surrender, this company is a meaty player in serving up graphic ads. With the popularity of Google, AdSense finds many content publishers flocking toward relevant text ads instead of flashy eye candy, but one shouldn't dismiss ValueClick so quickly. It is also a major player in the growing field of affiliate marketing through its CJ.com acquisition.
Advertisers have followed the consumers online and that means utilizing everything from Google AdWords and Yahoo! Overture to run effective pay-per-click campaigns to establishing affiliate programs tied to actual sales results.
The family portrait
Was the dot-com bubble and its eventual burst historical or hysterical? I'm sure many of you lived through it, and one day we can compare battle scars. Yet the "content is king" battle cry and the use of eyeballs as a growth metric -- things that seemed laughable when the sector was falling apart a few years ago -- now make perfect fiscal sense.
Paid search is allowing companies to reach consumers for mere pocket change, yet it adds up for search portals and providers of quality content. Eyeballs have dollar signs for corneas these days. So take a close look at the World Wide Web. The companies that have made it this far have never had it this good, and unlike the wishful thinking of the past, today's breed of optimism is shackled to financial reality.
It's better that way. It makes sure that next year's dot-com family reunion will be even more heavily attended.
Longtime Fool contributor Rick Munarriz writes the monthly Early Adopter column for the new Rule Breakers newsletter. He does not own shares in any of the companies mentioned in this story.
