Yahoo to Tie More Search Behavior into Ads

26 Feb Yahoo to Tie More Search Behavior into Ads

Internet News, NY, By David Needle, February 24, 2009
Yahoo is not sitting still under new CEO Carol Bartz. The company announced major enhancements to its display advertising services today designed to make the ads more relevant to Web surfers and how searches are conducted. The new features for advertisers include “search retargeting,” which is designed to tie relevant display ads to search activities. For example, a user searching for “sneakers” might see an ad for Footlocker. This is similar to what ads tied to keywords do, but Yahoo also said its new “enhanced retargeting” can bring relevant ads to users as they move between different Yahoo sites, not just for search. “Search retargeting is only available from Yahoo,” David Zinman, vice president and general manager of display advertising at Yahoo, told “The theme here is that marketers are looking for ways in this economic climate to make their marketing dollars go further. Our announcements today are all related to that, to take the capabilities Yahoo has in search and display and deliver better performance.” At least one analyst thinks it’s a great idea in theory, but Yahoo will need to be careful about how it’s implemented. “Obviously relevance is important to advertisers and consumers,” Gartner analyst Andrew Frank told “Yahoo is now going to use search behavior to target display ads and that’s consistent with a long-standing theme of search display convergence that many companies are aiming for. This announcement puts meat on the bone.” But Frank said too much relevance could be a turn off to some users who prefer to believe, whether true or not, their searching and surfing activities on the Web are anonymous. “I can see where some people might think search activities that lead to certain types of display ads appearing crosses a line,” said Frank. “It’s obviously less objectionable in some categories; say you’re looking for a car or flat screen TV. But let’s say you’re looking for a divorce lawyer or psychiatrist. You don’t necessarily want related ads appearing, particularly if the computer’s being shared,” Frank continued. “Yahoo will have to have controls on how this is implemented and I’m sure they have a privacy plan. They don’t want to freak out their users.” But Zinman notes the ad retargeting program is designed for major brands and is administered by Yahoo in conjunction with the advertiser. “We manage the campaign on their behalf,” said Zinman, who joined the company in 2007 as part of its $300 million acquisition of Blue Lithium ad network. While Yahoo has engaged in behavioral targeting of ads for years, Zinman notes there are a number of categories where the technology is not applied because that could be considered an invasion of privacy, such as health-related ads. Yahoo’s privacy policy also gives users the ability to opt-out of behavioral ad campaigns. Yahoo’s latest ad rollout arrives as the rumor mill awaits an expected management reorganization that could be announced any day. Display ads are one area where Yahoo has an edge over its bigger Web rival Google (NASDAQ: GOOG), which dominates the market for text ads related to keyword searches. With more than 10 percent of the online display ad market in theU.S., Yahoo has about twice the share of AOL and Microsoft, according to Comscore figures released last August. Google sites have only a 1.5 share according to Comscore. The richer content in display ads (graphics, images, video) are valued by advertisers as they tend to hold the user’s attention longer than a simple text ad. Yahoo, which announced the new feature at an ad conference in Floridasponsored by the Interactive Advertising Bureau, was not available for comment by press time. Yahoo did note in a release that advertisers will have control over where and when an ad is shown, including what time of day and day of the week, and even what age and gender they’d like to reach. Different time and demographic segments will be available via an online bidding process. One early user, Rico de Leon, senior director of Media Services Operations, at University of Phoenix, counted himself impressed. He said the Search Retargeting display product helped his company achieve an effective cost per lead that was at the same level as search backend goals and 50 percent lower than our regular display retargeting efforts. That ads up to a display campaign performing close to the company’s search campaign.