Want to let the search engine do the shopping?

Many Americans use the Internet for the same reasons they turn to the Yellow Pages – to learn about a product or to make a purchase.

But what many online shoppers don't realize is this: When search results pop up on screen, the websites listed first may not be the ones most relevant to their queries. Rather, the top positions often go to sites willing to pay search engines top dollar for prominent placement.

Such dealings, which have emerged over the past two years, are yet one more indication that the Internet's transformation from an information clearinghouse to a commercial enterprise is well under way.

"It's important for people to know that search engines have been hijacked by marketers," says Gary Ruskin of Commercial Alert, a consumer advocacy group, who asserts that search engines are "central to the quest of learning and knowledge in the information age."

To that end, the Federal Trade Commission last month made public a letter warning search engines to disclose those results that are paid for. Several have responded by tweaking their policies, but experts say some search engines' practices mislead consumers.

The practice has been driven by online retailers' desire to stand out in a virtual forest of millions of Internet sites. There's always advertising, of course, but retailers hawking their goods or services online now believe Web shoppers have tuned out ads. (Internet ad spending fell 12 percent in the first quarter this year, according to media-research firm CMR.) Many retailers hope bidding for top placement on search engines gives them choice access to consumers' eyeballs.

As general manager of Neo-Image Candlelight, Gary Strat relies on high visibility on search engines to drive traffic to his website (www.candlesjustonline.com).

Competition, even online, is fierce. A search for the word "candle," for example, yields between 1 million and 3 million results, depending on the search engine used. Bidding for a good position is essential to the survival of Mr. Strat's business. "Without paying money, being on top is luck of the draw," says Strat.

To get top billing, he works primarily through a service called Overture, which develops lists of websites carried by major search engines, including AltaVista, AskJeeves, MSN, and Yahoo!.

Internet retailers bid for position on Overture's lists. They place one bid for each search word or phrase they want their website to be listed under.

Strat bids on 40 words and phrases each day, including "candles," "wedding candles," "floating candles," and "votive candles." The bids range from 5 cents to 80 cents, he says, depending on the popularity of the term. The top bid for "candles" is generally about 80 cents on Overture (www.overture.com).

Each day, the highest three bidders are guaranteed the top positions for search results on participating search engines. Neo-Image Candlelight pays Overture between 5 and 80 cents whenever a Web user clicks on its link, even if no sale is made. Overture shares part of its profits with the search engines.

Google, another search engine, offers a similar bidding program. America Online – and, in about a month, Netscape – subscribes to its service.

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