Google Rolls Out Targeted Ads

  |  February 27, 2003   |  Comments

The search company beats rival Overture to the punch with new ads featuring paid listings on content pages.

Google, which has remained quiet during the paid search sector's recent flurry of activity, has, without fanfare, rolled out a new ad product that will serve relevant paid listings on Web sites' content pages.

Through new program, called "Content-Targeted AdWords," Google can syndicate its listings to Web sites beyond those with which it has long-term deals. The listings appear in the banner or skyscraper space on Web sites, a placement that obviates the need for costly re-designs, and they're tailored to the content on the page. Google's launch comes just days after Overture said it would roll out a similar offering this year.

The idea behind the targeted ads is to build on the success of paid listings by moving them beyond the search-results page. With Google's offering, a user checking the weather in Palm Springs would then see paid listings for local hotels or car rentals from advertisers who purchased related keywords like "Palm Springs hotels."

So far, the Google network of content sites offering the paid listings is small. Google's Web site names information site HowStuffWorks, Weather Underground, and recently acquired Pyra Labs' Blogger. The service is only available in English in the United States, Canada, United Kingdom and Australia.

Google representatives were unavailable for comment.

On HowStuffWorks, a skyscraper ad with up to five paid listings in shaded boxes appears on the left side of the screen next to the site's editorial. To get the program rolling, Google is offering its AdWords customers free clicks through March 12. After then, advertisers will be charged on a cost-per-click (CPC) basis with a maximum CPC and a daily budget. The offering is integrated into Google's AdWords program, meaning an advertiser's listings can appear on the search results on Google or any of its partners in addition to participating content sites.

"They're claiming that they can analyze any kind of page on the fly and deliver very targeted ads to it without human intervention," said Danny Sullivan, editor of Search Engine Watch, which is owned by the parent company of this site.

Earlier this week, Overture said it would roll out a contextual ad product this year. The company's chief executive, Ted Meisel, said the company would spend between $10 and $12 million this year on this and other new product initiatives, including local-oriented search.

Overture has said its acquisitions of AltaVista's site and FAST's AlltheWeb.com site would allow it to ramp up testing of new products, like the contextual ads.

Speaking at an investor conference on Tuesday, Meisel gave the example of a portal's sports page including ads with relevant links for memorabilia or ticket-purchasing sites.

Publishers, who have made a mint off paid search, have been eager to expand paid listings beyond the search page. Google's new program requires a minimum of extra engineering for the ads to appear, requiring just a snippet of HTML for the ads to appear.

One of the most eager to exploit the potential of paid listings and search is Yahoo, which last year took in $140 million through its paid-listings partnership with Overture.

Jeff Weiner, Yahoo's senior vice president of search and marketplace, said during the company's recent analyst day that the portal planned to expand paid listings throughout the portal. Weiner said the company's strong verticals would allow keyword advertisers to find highly qualified leads for their services.

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