Yahoo/Inktomi Business Plan

Pay per click and paid inclusion

[Jungle_Jim]

I have just completed participating in a four-day online focus group with about 8-10 other webmasters/site owners. The company sponsoring the event was not initially made known, but became apparant by the last day. The first three days consisted of general questions about search engine marketing including such topics as Pay Per Click vs Paid Inclusion, editorial review, reporting tools, etc. The moderator asked for feedback on our perception of various search engines (e.g., Google, Overture, Yahoo!). Eventually it became clear that Yahoo! was the sponsor of the session. On the last day they introduced a proposed business model that would consist of both paid inclusion (such as Inkotmi currently offers) and pay-per-click (such as Looksmart). Just so I'm clear, not either/or but both payment plans. That is you would pay a yearly fee to have your site incdluded in the index and pay a set fee per click (no bidding). They did not suggest a price for either payment plan (in fact the moderator asked what we would be willing to pay). It probably is no surprise that all of the participants had a negative response to this business plan. Most people said they might pay for one plan or the other but not both. I don't have any idea whether this program will ever be implemented (after all that is why they have focus groups), but it will be interesting to see what Yahoo! does, because they are clearly up to something.

[JamesR]

They would experience the biggest backlash they have ever seen.

[mfishy]

That is what the geniuses over at Yahoo! came up with? :)

When are they going to get it?

[jeremy goodrich]

JamesR has it right -> there is no way that would fly with webmasters, while the option of Overture is there.

Limit the plan to one or the other - but not require both PFI and PPC for a site to be listed there.

Take a good, long look at the public opinion here & elsewhere about another company that switched up their business model so drastically, and you'll find webmaster resentment like no other.

On a positive note, I'll bet the response would be to drive even more people towards using Google exclusively for searching. Which, so long as that remains a free index to be included in, can only spell good things for the eventual Google IPO by driving even more revenue through their AdWords program.

[martinibuster]

...require both PFI and PPC

This is close to Yahoo!'s current business model already: $299 PFI and Overture PPC. It's not a big change.

What intrigues me is that the graffiti on this wall indicates that Overture and Google will eventually get the boot (non-news I know) but sooner than most people may think-

Any marketing heads want to chime in on this question:

What's the average timetable for moving from focus groups to decision making to execution? 6 months?

[engine]

Well, if they learnt anything from the feedback they will know this move would be unpopular. It seems they are trying to monetise every aspect of their search service for every possible cent/penny.

I don't blame them investigating the opportunities - at least they are investigating instead of flicking a switch to PFI & PPC - look where it got some services. ;-)

With a poorly supported programme their search service will end up offering users little or no value. These users are now much more sophisticated and will know about alternatives. Off they drift to the known value sources. The advertisers end up losing out by getting less traffic and less VFM. Advertisers will end up putting their money where it works.

It would seem to me a bad move.

Thanks for the heads up JJ.