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Also, do you think Overture will ever change their bidding system right now? I personally think it's the best PPC engine out there for my dollar.
I have just received my new media age magazine and it says that it is due to launch early next year but have no timescales yet.
It did say
"it's next month that we start using it for all out US ads and then by early next year we'll be using it on a global basis"
"the UK is likely to be one of the first countries to follow the US"
Thats about all it says about when it is coming, so it shouldn't be too long now.
joined:Feb 13, 2003
As far as Overture changing it's formula, I've heard many rumors for both yes and no, but not anything substantial enough that'd I'd make a bet either way.
On that topic, I'm not sure many advertisers have considered the ramifications of this to their Overture campaigns. IMO (and note that I'm with Efficient Frontier so my viewpoint is that of someone who stands to benefit from the below) any firm using a rules-based bid management tool on Overture is going to have to make sure their bid management vendor has a strategy to be able to continue managing spend on Overture.
Rules-based systems were built with bid position-based systems in mind, and when Overture adopts Google's more opaque style, rules-based systems will cease to work effectively. AtlasOnePoint, Did-It, Performics, Overture's own Search Optimizer, KeywordMax and over a dozen other rules-based bid management systems will need to be significantly modified/rewritten in order to be able to effectively model the impacts of CTR, ad quality, and maximum CPC/effective CPC on keyword performance.
Many of you have probably already seen how ineffective rules-based systems are in managing to revenue *and* profit goals on Google AdWords; now imagine the same applying to Overture (and MSN who will also factor in CTR in 2006) and you have a situation where virtually every firm offering bid management stops bringing anything more than administrative value to the advertiser table.
Should be a fun 2006!
I listened to that call, and I did *certainly* did not hear this. What I heard was overture was going to do things to increase click through rates on their ads - to me, this means contextual advertising in Q1, a la adsense. I spoke to Overture, and I was told the auction system was here to stay due to advances in 'advance match'. I guess nothing is written in stone at this point, but knowing overture, no changes will take place until May-June at the earliest.
1) The investment community took Yahoo's CFO's comments to mean the same thing as I did; namely that Yahoo will factor in CTR to its auction system starting sometime in the first half of 2006. Yahoo Search's CTR is 35-45% lower than Google's, and it's clear to every major institutional investor that that is due to Yahoo not factoring in CTR as Google does. Read some of Safa Raschty's (Piper Jaffray) reports on Yahoo Search - he says the same thing about Yahoo moving to CTR-factored bidding in 1H06.
2) Revisit the SEW thread on the topic, wherein Shor gives details of his Yahoo focus group participation, YahooSarah concurs that the changes described are in the works, and you yourself wonder out loud & with consternation why Yahoo *is* going to be making this change.
You say that Overture is the best PPC for your dollar. Given Google's larger reach, better overall user base, and CTR incentives for advertisers, you must either be in one of the rare spaces where Yahoo's demographic is better, or IMO less capable of handling Google's CTR-based bidding environment.
Google is *killing* Yahoo in the paid search market right now, and it is or should be common knowledge that factoring in CTR is one of the major reasons why. Among the advertisers, publishers, SE folks and agencies I talk to, it's also clear that Yahoo knows they need to factor in CTR and plan to in 06.
People can deny reality on this one, but the change is coming and rules-based, self-service bidding strategies/technologies are going to be ineffective in this new Yahoo system.
One man's opinion as always,
I am not biased, trust trying to figure out what is going to happen.
Google does not break out adsense revenue from their total clicks. Yahoo click percentage are down in comparison to googles due to the fact Yahoo does not have a 'adsense' like product. This will be one way to improve a company click through rate, which is what was stated on the call.
I also read Shor post on another thread regarding CTR, and I was told this was a test and not everything in testing gets moved to production overture. For you to say that Overture will go to CTR method in 2006 is just not true.
I think overtures action method costs more per click than googles, and with advance match, delievers a fair amount of clicks. I just cannot see Overture going to a CTR method as it completely destroys what they are trying to do there. If Overture does indeed make a switch to CTR, I sure hope they give months notice, and don't roll out this product too soon. Second half of the year would be great so the bugs can get out if you know what I mean.
Anyway, until I get confirmation for sure, I assume Overture big move in Q1 is contextual advertising to improve CTR rate.
joined:Feb 13, 2003
Yahoo click percentage are down in comparison to googles due to the fact Yahoo does not have a 'adsense' like product. This will be one way to improve a company click through rate, which is what was stated on the call.
Just to clarify, Yahoo does have an AdSense like product called Yahoo Publishing Network [webmasterworld.com].
Yahoo has had the ability for advertisers to set different bids for contextual and search for some time, which is way ahead of the AdWords smart pricing system.
I don't have much to comment on the rest of the thread, just wanted to toss in a clarification.
1. CPC vs. CPM- Yahoo auctions based on a click, whereas Google converts your CPC bid to an effective CPM by evaluating CTR.
2. Open auction vs. hidden auction- There is a finite bid in both yahoo and google that will get you to a given position at a moment in time. Yahoo shares this marketplace data while Google does not.
There is room here for a blended model, and those advertising on Ask Jeeves have seen it. I very much hope that Yahoo can see the potential here and move to a system that maximizes their revenue while preserving the openess that makes their system superior to the Google "blind bidding" model.
superior to the Google "blind bidding" model
A system based entirely on who pays the most results in listings that reflect that.
This is the current Yahoo system: Rich = Visible.
The comparison to Google should include its diligent and provacative inclusion of non-monetary data in determining the placement of the ads. They are attempting to develop a system that is (a) more inclusive of all of their advertisers and (b) more relevant to their users.
One could argue that if Yahoo doesn't change to a more responsive-to-the-environment model then Yahoo will drift with the global economy ... which is neither stable nor advancing. That's good for neither the users nor the company and its shareholders.