by Search Copywriter
B. Emirzian
If you're an avid bigmouthmedia newsletter reader, you'll remember early November's news that Google decided to 'spread its wings beyond the web'. That is, the search engine giant struck a deal which would offer advertising space in US newspapers to around 100 of its advertisers through the AdWords programme. But as Google's scheme gathers pace, it seems that rival Yahoo! is hot on its trail.B. Emirzian
Yahoo! has just struck a similar deal with seven major US newspaper groups and 176 regional newspapers across thirty-eight states. The search engine company will publish local classified ads across its network of sites, as well as power local events listings, maps and technology on the local newspapers' websites. The newspapers, on the other hand, will supply local news content for Yahoo! and use Yahoo!'s advertising platform to sell and host the targeted local ads on their websites. Those involved with the partnership are anticipating even more types of advertising, shared news content and search abilities to be put into effect in the near future.
The press groups involved in the deal include Cox Newspapers, Hearst Corp, MediaNews Group, EW Scripps, Belo, Journal Register and Lee Enterprises, and Yahoo! will be working with newspapers such as the San Jose Mercury News, The Dallas Morning News and the Atlanta Journal-Constitution. The agreement will not only enhance Yahoo!'s regional exposure, but will give papers a nationwide range in terms of exposing local ads and content.
So what prompted the deal? The similar gamble taken by Google earlier this month sets a clear precedent, for starters. But another reason for the deal might be related to Yahoo! report of a sharp 38% decline in quarterly profits last October, following slumped financial and car advertising revenues. And seeing that Google's shares skyrocketed when it snared a large share of US online advertising revenues through its deal, following suit seems to make sense for Yahoo!.
But how do newspaper companies feel about the deal? To put it simply, they appear to be thrilled. In recent years, newspapers have had to deal with shrivelling shares of the classified advertising market as a result of online competition. Press group Scripps reported that newspaper classified revenues were down 3.2% in October 2006 from the previous year, reflecting a general migration of attention from print to online advertising.
"Most local newspapers have done a pretty good job of generating local revenue into their sites," said Leon Levitt, vice president for digital media at Cox Newspapers. "[But] it's so much harder to generate national revenue because a lot of advertisers don't want to deal with 100 different newspapers. This [deal] will make it simple."
Many have criticised Yahoo! for not having beaten Google to the game and believe that Yahoo!'s ad revenues could suffer if US economic growth slows. But high hopes have risen from the deal, considering that more than 500 million people around the world visit Yahoo! websites each month.
So the competition for local ad dollars is well under way, as the various technologies powering local search push for the integration of different types of media. But who'll come out ahead? For now, that depends on how fast Yahoo! can flap its wings.
