Yahoo Releases Quality-Based Pricing
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Written By Kate Zimmermann | June 5, 2007 | Share This
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Yesterday evening, Yahoo added quality-based pricing to their Panama search marketing platform. From Yahoo’s press email,
“What is quality-based pricing? Essentially, it assesses the quality of a publisher’s traffic based upon the publisher’s ability to deliver more interested, high-value potential customers to Yahoo!’s advertisers. A few of the factors considered by quality-based pricing include publisher conversion rates, traffic source and implementation type. Depending on the quality of a given publisher’s traffic, the cost of an advertiser’s click can be automatically discounted by a certain percentage.”
Google Adsense already does this, in what they call “Smart Pricing.” JenSense observes that this is a gutsy move for Yahoo, because Panama is still dealing with relevancy issues. She writes,
“If I have a site about hockey yet am seeing ads for mortgages and long distance, those ads are definitely not targeted to those visitors. And as a result, the odds of a successful conversion - and value - for those advertisers is seriously impacted. So publishers who are showing irrelevant ads for their content could find themselves losing revenue through no fault of their own, but simply because Yahoo is not providing ads that are targeted to the content.”
On the other hand, quality-based pricing will decrease overall spend for advertisers. If you’re a long distance company and your ad is being shown on sites about hockey, of course you’d prefer to pay less for that traffic than for clicks coming through more relevant sites. As Traffick points out, Smart Pricing has been a big part of Google’s content network performance, and Yahoo has long needed a similar pricing structure to stay competitive.
Topics: Advertising: Online, SEM: Bid Management, SEM: Paid Search, Search: News, Yahoo! |