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All it takes is for Yahoo to get their ad serving to a level where the relevancy is on par with Google. CPC is typically higher on Yahoo, and Yahoo can play with the publisher payout rate to compete with Google. Once Yahoo is consistently paying out higher than Google, we could see a mass exodus as it's a simple swap of code to convert. As publishers switch sides, it will make the network larger and more effective, and draw more advertisers in.
It's a lot easier to change publisher and advertiser behavior, than to change consumer behavior and share of searches. If this happened, it could represent up to $1B shift in the marketplace, and make a big dent in Google rev.
The Big If is, can Yahoo or MSN finally get their act together to have a simple, elegant network on par with Google? And, you can always count on Google to have something up its sleeve in response.
CPC is typically higher on Yahoo...
I think you mean EPC (earnings per click). And is that really true?
and Yahoo can play with the publisher payout rate to compete with Google. Once Yahoo is consistently paying out higher than Google, we could see a mass exodus as it's a simple swap of code to convert.
First of all, nobody but Google knows what the payout percentage is for any given site. So how could Yahoo "consistently pay out higher than Google"?
Second, Google's overall payout to publishers is nearly 80 percent, and it's hard to see how Yahoo could exceed that figure by a significant margin for any length of time without making stockholders and Wall Street analysts unhappy.
Third, even if Yahoo accepted losses or minimal profits from YPN during the recruitment phase, how would it retain publishers later on when it adjusted the publisher payout downward (as it would have to do at some point)? Publishers could abandon YPN just as quickly as they could abandon AdSense.
As publishers switch sides, it will make the network larger and more effective, and draw more advertisers in.
This brings up the question of which comes first: the chicken or the egg. As a publisher, I'd rather have targeted contextual ads right now on my hundreds of subtopics (which Google can offer) than wait for YPN to build a larger network and attract more advertisers.
If YPN wants to compete with AdSense, it will need to offer innovative advertising products, not just me-too products with assurances of higher payouts.
I run search programs for many different companies large and small, so I have a fair amount of visibility into relative CPCs for a given position by engine, which is largely due to differences in position algorithms. So it stands to reason that if advertisers are willing to pay more for a given position on Yahoo, the same avg 80% payout to a publisher would be on average higher for Yahoo ad placements than Google. I fully realize this wouldn't be 100% consistent site by site, but it wouldn't be too hard for Yahoo to know when they start to tip the balance.
Web publishers will always flow to where the economics are most favorable. We saw it happen when publishers dumped traditional commission-based affiliate ads in favor of AdSense, and we'll see it again when the next opportunity comes along. There will be an increasing battle for the huge but finite advertising space on the web, which will naturally push up payouts and also place a premium on functionality, efficiency and effectiveness.
If they would just get OUT of beta, paying for non-US traffic and allowing non-US publishers to join, I'm sure they could make a dent in the market. But there's no sign of that happening, and until it does YPN will remain a distant second.
If they would just get OUT of beta, paying for non-US traffic and allowing non-US publishers to join, I'm sure they could make a dent in the market.
I absolutely second this. This is step #1 to increase market share.
And then - provide better tools to publishers than Google are doing. This is step #2.
I am very confident that within a very short timeframe a lot of publishers would convert to YPN.
False. Higher payouts are quite enough.
I referred to "assurances of higher payouts," not to higher payouts. Since "payout" is most commonly defined in this business as the publisher's percentage in a revenue split, and since Google doesn't reveal its payout to individual publishers in most cases, "assurances of higher payouts" by a Google competitor are likely to be based on hype, not on fact.
Of course, if a publisher gets higher bottom-line revenues from YPN, the publisher is likely to shift inventory to YPN. But before that can happen, YPN needs to convince the publisher that testing is worthwhile.
On MSN maybe and i am not sure but for sure not more then Google. Google CPC will be 4 or 6 times more then Yahoo in the area i am watching. They will not be able to compete with Google by adding more or international publishers. Publishers are also the reason CPC is falling for awhile now on Y
It is wrong to look at Google as having and controlling the entire pie. That would be like saying there is only one U.S. automaker in the country. YPN and Microsoft simply need to have different makes and models to offer. If that means higher payout for publishers that exceed expectations consistently, and better ROI for advertisers, then thats their niche. Its the difference between driving a high end luxury car and a moderate priced sedan. Thus YPN's stress of QUALITY as the theme.
If you want to look at it as a competition, the present $6B pie Google garners can be chipped away at IF YPN's quality initiative is a proveable selling point to advertisers. If Yahoo grabs a 20% slice, that would contribute 30% in top line revenue growth. That is very doable and huge for shareholders and the company. Competition is good. It stimulates increased supply and creates its own demand. Isn't that classical Keynesian economics?
Rome wasn't built in a day. Before you can compete, you have to have something to offer.
From the buzz I am hearing, when yahoo launches this, they are going to be a HUGE player and really compete in this space.
I've been happy so far with the change to Yahoo. I do miss my Link units from Adsense, but hopefully we'll see them soon on YPN.
I also like the reporting engine on Adsense better than YPN's. But given that it's all still in beta I've been very impressed.
I'm a bit nervous about going to release; it can either be a good thing or the bottom can drop out of CTR/CPM and I'd be forced to go back to Adsense. THAT I don't want to do. So far YPN has been significantly better for my content.
PS when you sign up with Yahoo, they actually assign you... that's right! ...A human being to help optimize your ads! YeeHee. This can only be good for the advertisers as well!
My numbers -
Initially, my magic number was 3.
Adsense CTR was 3 times YPN.
YPN EPC was 3 times Adsense.
Now, YPN EPC is still about 3 times Adsense.
BUT, Adsense CTR is SIX TIMES YPN. The ads are identical type, size, colors, and placement. It is hard to figure out why this difference is so large, certainly relevance, but there seems to be more to it than that. In the end, it doesn't matter. The decision is automatic, having been dictated by the numbers.
Add to that the superior Adsense reporting, and there is nothing more to discuss. Until later, when something changes. For me, anyway.
[edited by: Sally_Stitts at 4:39 pm (utc) on Aug. 2, 2006]
On the part of my site that sells stuff and my photo gallery they do good with relevance. Google is, no doubt, the King still. I just don't like putting all my eggs in one basket so I'll use both (on seperate pages, of course).
Another thing that really urked me was the fact that Yahoo wasn't showing ads on some pages at all (only sometimes). This site is nothing but content and that is a no-no. No way should those spaces have been left blank.