New Yahoo Display Tool May Compete with Newspaper Partners

  |  June 23, 2009   |  Comments

New DIY display tools launched by Yahoo and Google could add insult to already injured newspaper publishers.

New DIY display tools launched by Yahoo and Google present big opportunities for small-to-medium sized retailers, but they could add insult to the already injured newspaper business.

Yahoo's entry into the self-service display area is called My Display Ads, officially launched yesterday in partnership with AdReady. Seattle-based AdReady is already working with several newspapers including The New York Times. However, the reach of such sites is far smaller than what Yahoo will provide. The solution allows companies to create display ads in the same fashion as it creates text-based search ads, using a variety of ready-made templates.

Patrizio Spagnoletto, senior director, Yahoo Search Marketing, said the tool will allow SMB retailers overcome creative asset and financial obstacles to display advertising. The ads will be sold either on a performance or CPM basis. Minimum spend is $1,000.

In conjunction with Google's own do-it-yourself ad offering launched in October, the firm's new SMB retail advertiser-aimed ad offering could create more competition for newspapers when it comes to retail ad dollars. Google is testing an ad unit that will display product images and information such as price within sponsored search results.

"We're planning a beta test to show richer product information in the ads for shopping-related queries. This test will only be visible to a small number of U.S. users," a Google spokesperson told ClickZ News.

These and other easy display ad creation systems have become affordable and accessible for retailers that depend on reaching targeted local audiences. Like classifieds, those functions were once the province of newspapers.

Paul Knetgen, head of marketing for Dapper, a firm that creates ads dynamically using retail product and inventory, said automated tools like the ones offered by Yahoo and Google could be tough on newspapers. The hit on local retail ad revenues could be akin to the decimation craigslist has wreaked on newspaper classifieds, he suggested.

"When you look at other media and see what can be achieved for the money, we think [My Display Ads] will be very attractive," said Yahoo's Spagnoletto. When you look at the frequency achievable in the local paper for the money, we think we're significantly better."

His comments indicate that Yahoo's new display service could potentially bite the hand of the newspaper publishers that feed Yahoo local inventory and sales staff. According to Spagnoletto, My Display Ads will not, at least at first, be offered to members of the Yahoo Newspaper Consortium, the group of 814 newspaper publishers Yahoo has entered into online advertising agreements with. Yahoo has touted the partnerships as a way for newspaper publishers to generate additional online ad revenue as its print revenues plummet.

Spagnoletto said Yahoo wants to make sure details such as pricing and template design are stress-tested before the service is expanded. He was not sure that the new service would be compatible with newspaper sites, because advertisers need to analyze their search and display spending split and focus more on optimizing their ads within Yahoo before rolling them out elsewhere.

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