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Yahoo Overhauls Paid Search Program

Yahoo’s paid search advertising platform will compete with Google’s AdWords program better after the company announced yesterday that it plans to launch a completely re-designed ad system.

The new platform, which will be rolled out in the third quarter, includes enhanced geographic targeting for advertisers and a new ranking system, so search results are based more on relevance than in the past.

“This is the most significant development on the platform side since MSN debuted with adCenter and demographic targeting built into it,” said David Berkowitz, director of strategic planning, search marketing firm 360i, New York.

In fact, Yahoo Search’s advertising program will include more targeting similar to adCenter in the future that could include demographic information or online behavior, according to the company.

“We’ve designed our new platform to allow advertisers to reach Yahoo’s audience through search, as well as take advantage of advertising opportunities across all of our unique marketplaces,” said Steve Mitgang, senior vice president of advertising platforms and products, Yahoo.

The geo-targeting features of the new program are especially important to advertisers, Gaude Paez, a spokesman for Yahoo, told DMNews. The platform will incorporate IP targeting and technology from WhereonEarth, a company Yahoo acquired last year, allowing Yahoo to match results with the searcher’s intent. For example, the system can understand whether users are searching for Soho, NY, or Soho, London.

It will also increase ad distribution options and ad formats that include graphics or rich media.

“Once the first version of the core platform is in place, we will be able to move quickly to build in capabilities that ultimately will provide advertisers deeper access to Yahoo’s more than 420 million users,” Mr. Mitgang said.

The new Yahoo Search also will include more tracking, forecasting, and reporting for search advertisers. The platform offers analytics that were previously offered to advertisers on an invitation only basis through its Search Optimizer. “The new platform now allows every advertiser to take advantage of those capabilities if they want to,” Ms. Paez said.

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