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Reaction: Yahoo’s Contextual Ad Alliance with Google

Written on
Feb 7, 2013 
Author
Mike Daly  |

The industry is understandably abuzz about yesterday’s announcement that Yahoo! had formed a strategic partnership with Google.

“… We’re excited to announce that we recently signed a global, non-exclusive agreement with Google to display ads on various Yahoo! properties and certain co-branded sites using Google’s AdSense for Content and Google’s AdMob services,” reads the posting on Yahoo’s blog. “By adding Google to our list of world-class contextual ads partners, we’ll be able to expand our network, which means we can serve users with ads that are even more meaningful. For our users, there won’t be a noticeable difference in how or where ads appear. More options simply mean greater flexibility. We look forward to working with all of our contextual ads partners to ensure we’re delivering the right ad to the right user at the right time.”

Such deals are hardly unprecedented. In Q4 2011, Yahoo, AOL and Microsoft  announced a partnership that allowed advertisers to buy ”premium, non-guaranteed display inventory” from all three companies. At the time, according to Adweek, Yahoo! opted to utilize its own Right Media as its ad exchange while Microsoft went with AppNexus. Two months later, AOL announced its selection of the Right Media Exchange as the platform to provide real time access to AOL inventory.

This week’s agreement also comes seven months after Marissa Mayer (pictured) became Yahoo’s CEO after 13 years at Google, and four months after Mayer spirited away Google’s president of partners business solutions, Henrique De Castro, to become Yahoo’s COO.

Some top industry execs are weighing in the Yahoo/Google deal.

“It’s an interesting match and may be a good thing for consumers in getting ads that they care about, but from a marketer’s view it may not make their lives any easier,” said Aggregate Knowledge CEO David Jakubowski.” Based on AK’s experience of delivering pure cross-channels insights across inventory providers, what this may highlight to marketers is an increase in overlap across the two channels along with a decrease in exclusive reach. This runs counter to a marketer’s goal of increasing media spend efficiency by reaching new users and consistently marketing to them to drive new sales.

“The decision to use Google/AdMob is a mobile-focused decision and is yet another example of a major player, Yahoo, working harder to better monetize their mobile traffic,” said  Helene Rosenblum, GVP, Media and Analytics, Leapfrog Online. “Yahoo and Google both recognize the critical role that mobility is having on consumers and specifically, the role it has in the consumer purchase process. By integrating with Google/AdMob, Yahoo validates the need to make mobile advertising a pivotal component of their value offering. With this news coming on the heels of Google’s ‘enhanced campaign’ announcement, it begs the question: Will Google announce a similar ‘enhanced campaign’ decision in display in the months to come?”

“I think it makes sense for Yahoo to work with Google in this way,” said Michael Connolly, CEO of Sonobi Media. ”Essentially Yahoo is becoming a publisher for Google. This partnership addresses the fact that Yahoo is struggling with on-boarding demand. By outsourcing a portion of this to Google, it should free up more resources for them to have a real focus on the supply side.”

“The partnership can be justified under improved targeting benefiting both parties and covers contextual online and mobile ads,” said Vijay Sundaram, CMO, SocialTwist. “A trick missed here might be new ad formats and consumer engagement strategies that improve awareness and engagement by incorporating social elements.”

Meanwhile, both All Things D and AdExchanger have speculated about the potential ramifications of the deal, with the latter wondering whether it will precipitate the demise of Right Media.





Mike Daly is an award-winning writer and editor with 30 years of experience in publishing. He began his career in 1983 at The News of Paterson, N.J., a long-since defunct daily paper, where at age 22 he was promoted to the position of Editorial Page Editor. Since then he has served in managerial capacities with several news organizations, including Arts Weekly Inc. and North Jersey Media Group in New Jersey and Examiner Media in New York. His work has been honored on numerous occasions by the New Jersey Press Association and the Society for Professional Journalists.

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