At the Cannes International Advertising Festival today, Microsoft has announced it plans to extend the new Live Search Cashback program to the UK.

Launched at the Advance08 advertising summit held in Redmond, Live Search Cashback has been in testing during the past month in only the US market. The service forms part of Microsoft’s new efforts to make progress in the Search market, along with Engagement Mapping, which was also demoed in front of Microsoft’s advertising partners at Advance08.

To recap, Live Search Cashback offers users the chance to search for products they wish to buy, and then offers cashback savings on the purchase. For example on a Microsoft Zune 80GB, a discount of between 2-5% is offered from the various participating stores; Oakley sunglasses have a 9-12% discount. On purchases of $100+ these savings really do add up, so somehow Microsoft has to market this tool well in order to drive growth. Definitely not a trivial task.

Announcing the expansion of the cashback program out to other markets so soon after its initial launch is a good sign. It suggests that user retention or “stickiness” is high, and that both partners and Microsoft are happy with how things have progressed – driving sales and monetising search traffic. With Live Search Club now taking 2.6% of all US search queries, if Cashback can make a similar impact then that will be no small achievement. Whether this is something that “disrupts search” remains to be seen.

I couldn’t get much out of Microsoft about this, but Brad Goldberg, GM of the Live Search Business Unit gave a statement:

“As discussed this week, we have plans to scale our search efforts in EMEA. Cashback is a core part of our strategy and we’ll look at that as part of our overall plans.”