I was thinking about things that I dislike about Yahoo!’s new platform, its definitely a huge improvement, but from the business end, YSM seems to approach advertising much differently than Google. To mix metaphors, if the proof of the pudding is in the eating, its easy to understand why Google is eating Yahoo’s lunch.

1. Higher minimum CPC. How can Yahoo! possibly justify a min. bid of $.10 when Google allows a min. bid of $.01. In my experience, its clearly posturing as the lowest CPC we have ever seen is $.02, but the fact that Yahoo! has an artificial restriction is maddening.
2. Human Editors. Notice to Yahoo!, you could hire the entire editorial team of the WSJ, New York Times and Boston Globe, and you wouldn’t have enough editorial brainpower to handle search. Search is a numbers game. Stop putting humans in the way. If your numbers say that people are responding to an ad, let it run. Don’t give that power to a human editor.
3. Not being Agency Friendly. We manage close to 100 campaigns per month for our entertainment clients. In order to create an account under our Agency management account, we have to email Yahoo, which creates shell accounts, named “Shell Account 1″, “Shell Account 2″. When we use those accounts, we have to email them and ask them to change the name to whatever we want. This is the most basic of a 100 ways that Yahoo! makes it tough to run many, large SEM campaigns with them.
4. Contextual Network. Its small and not well-optimized. In my opinion, too much emphasis on highest-bid and not enough emphasis on what ads are generating clicks on against that content. Since its a CPC network, poor optimization leads to less revenue, which leads to less publishers.
5. API. The API and the web site do not have the same functions. One example, through the management interface, I can run a report that shows me what URLs the clicks went to. There is no API function for that report.
6. Constantly Behind the Game. It still takes forever for humans to approve ads, despite their promise of faster ad approvals. And, even worse, we are constantly having words/ads declined for campaigns that ended months ago! Yahoo, take those people reviewing old ads, and put them on the new ones.
7. Difficult Human Editors. We’ve actually had the term “High School Musical” declined for a campaign for the High School Musical soundtrack. This 1 term took 3 revisions, and three calls with Yahoo’s human editors. Some of their editors are great, reasonable and smart - there are some that are just difficult.
8. Prepay billing even with a credit card. The concept of a declining balance is lame for a company as large as Yahoo. You have an authorization with Visa, Mastercard, Amex to charge the card. Why do you need to insist on holding money, and to make matters worse, insisting that we put in a minimum of 3 days worth of money into the system?
9. API again. Our Chief Architect says ‘You have to generate the Java classes to talk to the API. Google does this for you.”. Whatever that means.
10. My biggest pet peeve is: No display ads. Google lets you run text ads, video ads and banner ads on a CPC-basis with no minimum spend. Yahoo, the clear 2nd place company, doesn’t allow banner or video ads. If you want to use those, according to one of their reps, its a min. of $50,000! Google made its billions $.10 and $.15 at a time. Yahoo is trying to make up that ground $50,000 at a time. Sometimes, you have to follow the leader and in this case, I would beg Yahoo to realize that creative is only a hook to get a click. Do everything in your power to get a click! If that means better creative, allow it.

Thoughts?

As most of our clients know, I don’t like site-targeted ads.  I think that online advertising is less of a creative process, and more of a technical process in which millions of data points are analyzed and an optimum mix of of creative/pricing/placement is developed. That being said, I understand that sometimes you have to buy advertising on certain sites. So, we are happy with Google’s recent announcement that CPC site targeting (i.e. placement targeting) is officially live.

This features allows us to offer clients a chance to target a specific site, but retain the hallmarks of SEM campaign - no minimum spend, control of creative, control of flight dates, etc.

However, I wonder how top publishers will react to Placement Targeting and if they understand the implications for their business model. Google built AdSense on two principles: First, their technology will deliver highly targeted ads which will increase CTR and thus the advertiser’s satisfaction & publisher’s revenue. Second, the network was double blind in that publishers don’t choose advertisers and advertiser’s don’t choose sites.

Now, placement targeting rolls out of beta and voila, Google is THE rep for every site that uses AdSense. Forget your salesperson’s relationship with an advertiser or the years of working together. When that advertiser realizes that they can buy advertising on your site and pay per click, instead of per impression - they are GONE! And, anyone who thinks that Google isn’t wickedly clever, hasn’t followed the story. Here is how you own the online ad space.

1. Roll out *cheap* targeted text ads that convert very well and deliver top-notch results. (AdWords)
2. Take those same cheap targeted text ads and 100,000’s of advertisers and expand beyond your domain. Now, everyone can share in your windfall, except that they don’t know their % share. (AdSense)
3. Expand the advertising creatives available to advertisers from text ads to banner ads to video ads (AdSense Image Ads and Click-to-Play Video Ads)
4. Get rid of the double-blind nature of your ad exchange and give access to 100,000’s of sites, as your technology serving as the easiest and most cost-effective way to buy advertising - severely undercutting the CPMs on the publishers’ rate card.

This is very much a game changer and it will be interesting to see which sites opt-out of site targeting or worse, opt-out of AdSense. There is no doubt that this makes Google’s platform much more compelling for advertisers, and less compelling for publishers. As an advertiser focused agency, we’re ecstatic, but we realize that the power of the Google platform is that we can reach great sites like CNN. It would be a shame if this development drove quality sites out of the network.

I have a major problem with Google playing high & mighty and scoring landing pages/sites and factoring that QualityScore into an advertiser’s minimum bid. Google has standardized the lion’s share of their advertising on a CPC-basis. The basic premise of a CPC pricing model is that an advertiser buys the visitor from Google, and are free to do with that visitor what they want.

I applaud Google for not allowing ads that link to pages with pop-ups, phishing sites, etc. They have certainly made the web a safer place to surf by imposing their limits. I was talking to a client about Google’s implied editorial endorsement. Your ad benefits from being in a box that says “Ads by Google”. Its a very easy way for Google to transfer some tiny bit of brand equity to your site. It says “Google has deemed your Ad good enough to run on our network”. Admit it, if Google opened a coffee shop or auto dealer in your town, it would immediately be the coolest lounge (for geeks) or the most fair car dealer. Everything Google touches turns to Gold.

However, with their post today on the AdWords blog, they are starting to show that its not about protecting their users (their “true north”), its about protecting their users for the right price. For me, this one line said it all “The following types of websites are likely to merit low landing page quality scores and may be difficult to advertise affordably”. You can still run your scams, you can’t just do it affordably. Or, read differently, we realize that your site is probably a scam, but we’ll still sell you a user if you pay us more.

If Google asked, and they have not, I would propose the following:

1. If you want to protect user experience, have a standard and stand by it. If its not good enough for Google, don’t run the ad, regardless of price. The user doesn’t know/care if Google charged $.10/click or $10.00/click.
2. If you are going to score websites, you should give them clear-cut guidelines on what you are looking for. If changes are made, allow them to see how that change affects their QualityScore either negatively or positively.
3. The min. bid could be high for a number of reasons, most are due to campaign set-up, structure, negative matching, ad text, etc. If those are the issue, fine. If its the landing page, alert us!
4. Come out with clear-cut details on how rich-media pages are scored. Is Flash positive for user-interaction? Is it a negative?

Would love to hear from other agencies out there - do you think that Google is being overreaching and under-informing?

Welcome to SearchParty! We had well over a 100 submissions for naming our blog. We chose “SearchParty” because its a whimsical name and a fun double-entendre. We’re hoping that the comments will be like a cocktail party of super smart people talking about online marketing & that, like us, you’ll always be searching for better ways to advertise your sites, artists, shows, movies, games, events and products!

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