The Yahooglesoft effect on advertising
Yahoo and Google are revolutionizing the advertising industry, and it won’t be all for the better.
Yahoo and Google have “context-based” advertising programs. Microsoft just purchased one. These are great for advertisers looking to reach a more targeted audience.
If there is a story about surfing on a website, ads for things surfers are likely to buy. Advertisers win because their actual customers are more likely to see their ads. Moreover, for less ‘popular’ terms, the cost is lower — which means the smaller the market or the narrower the niche, a company can get into advertising for relatively less money.
Sounds like a win-win, right?
Well, consider this as well. As Yahoo, Google, and Microsoft sign up partners for their ad programs, they will be looking to large, national advertisers because they can aggregate so many sites into one place. Yahoo, for example, has more than 400 daily newspapers as part of its network. For the Proctor & Gambles, Johnson & Johnsons, and Coca-Cola’s of this world, this is great. Their agencies can place ads on all of these sites by going to one source: Yahoo.
But the future is dimmer for local advertisers. As more and more ads are placed by the three giants, less and less inventory will be available to local businesses. Some sites could abandon their ad sales staff entirely, giving all of their inventory to the Yahooglesoft monster.
How does a local mom-and-pop restaurant advertise in this world? They have to be savvy enough to sign up on a Yahooglesoft program website, and hope they can limit their exposure to people in their immediate area? Would a Tampa restaurant really want to advertise on a California newspaper site that has a story mentioning “Tampa”? After all, they are not looking to reinforce their brand - they want butts in seats.
Advertising agencies will adapt and learn how to navigate the online world, much as they did with the offline world. Still other agencies will adapt to become “local ad sales agents,” serving as the local/public face of websites targeted to a specific geographic area.
Yes, the Yahooglesoft monster will change the industry… how it will all shakeout will be interesting to see.
