Microsoft Offers Paid Display Ad Upgrade to Free Classifieds

Interactive banner advertising isn’t exactly an option for most individuals trying to unload their old clunkers or the houses they’ve outgrown. A classified ad format now available to users of Microsoft’s Windows Live Expo classifieds service will make paid display ads more accessible to free classifieds advertisers. The question remains, however, whether they’ll be willing to pay for them.

As announced today, classified ad technology firm AdMission will enable Live Expo’s free classifieds advertisers to pay to have items featured in display ads. The advertisers won’t get the whole ad to themselves, though. They’ll have to share them with others selling similar car models or homes nearby; up to 10 listing images can be featured at once. AdMission’s Spotlight ads, which are currently available in standard banner, leaderboard, skyscraper and wide skyscraper formats, feature thumbnail photos representing multiple listings. Users can scroll through the ads and expand the ad from each listing image to learn more information about a specific item and link directly to a full listings page.

“Microsoft is going to be the first big rollout of [the Spotlight ads],” said Leif Welch, VP of business development for AdMission. Welch describes the dynamic units as “a hybrid between a typical banner ad for one advertiser that is branding focused and one for multiple advertisers. Rather than being immediately directed to a Web page, you’re presented with a qualifying step.”

The company provides its classifieds content collection and display technology to online newspapers, Web directories and classifieds sites including,,, and The New York Times Company’s and AdMission was spun off from the now defunct IPIX Corporation, which had once provided image hosting services to eBay.

Expo users will be able to upgrade their free listings to exhibit item photos in the Spotlight ads, which will be served on search results pages and homepages within related listings categories, according to Welch. Expo will most likely charge advertisers between $10 and $20 to include items in the Spotlight units for a four-week period, Welch suggested, adding “We let the publishers do the price point.” Microsoft chose not to comment for this story.

“How these online classifieds sites are going to monetize has kind of been a challenge,” observed Kelsey Group Senior Analyst Mike Boland. “One way is with a paid upgrade,” he continued, alluding to the new Expo up-sell.

“The strategy makes a lot of sense for portals like MSN,” opined Peter Krasilovsky, principal of local media consulting firm Krasilovsky Consulting. Still, he said, “I don’t know whether it’s going to be considered worth the premium.” Krasilovsky believes advertisers should see value in having their listings highlighted in such a prominent manner on a big brand site like Live Expo. However, because Microsoft is competing directly with other free listings sites like Craigslist, he cautioned, the publisher “will really have to do a marketing job to convince advertisers that this is the way to go.”

In its initial Live Expo offering, the ads will be made available only to auto and real estate advertisers, according to AdMission. “They’re going to gain more traction within those verticals,” commented Kelsey Group’s Boland. Real estate and auto advertisers, he said, “will be willing to spend more because those are the advertisers traditionally in newspaper classifieds they’re already used to paying for.”

Also, selling to high volume, high-ticket item verticals such as these will help Microsoft gauge whether the offering could be successful for other advertisers who aren’t used to paying often for ads. “This is something that will maybe allow [Microsoft] to tap into a different segment of advertisers that Expo doesn’t appeal to now,” added Boland.

When users click to expand the Spotlight ads in Expo, they’ll find larger photos and text. However, AdMission enables in-ad features Microsoft will not use in the Expo ads, such as send-to-a-friend, e-commerce and “make an offer” functionality, as well as PayPal integration. AdMission will target the ads based on context, keywords, geographic data, item descriptions and other information. Ad metrics including CTR and impressions can be tracked through the Windows Live platform.

Those targeting and tracking capabilities will be especially important if, as AdMission’s Welch hinted at, Microsoft eventually runs the ads outside of Live Expo in other areas of MSN. The site’s Local search, Autos and Real Estate sections are obvious fits.

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