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Follow UsEric Auchard
NEW YORK: Yahoo Inc., the world's biggest online advertising supplier, is aiming to fend off challenges from Google Inc. and Microsoft Corp. by helping corporate marketers use both keyword and brand-based ads, its advertising sales chief said on Thursday.
Greg Coleman, Yahoo's global sales executive vice president, told the Reuters Media and Advertising Summit in New York he is seeking to help Yahoo's stable of major corporate advertisers marry brand-advertising with ads based on keyword searches.
Six weeks ago, Coleman was named to head a newly combined global advertising organization that combines the two pillars of Yahoo's advertising business -- both text-based keyword search advertisements and graphical, brand-reinforcing ads.
"The biggest opportunity I see in the changing landscape (of online advertising) is the very significant lead that we have in both channels," the Yahoo executive said.
Google, which derives virtually all its revenue from keyword-search ads, is widely expected to be prepared to offer brand-based advertising. Meanwhile, Microsoft's MSN is testing its own keyword advertising system and will quit relying on Yahoo's keyword advertising system by next June, he said.
"There is no doubt in my mind that Google is going to be out soon with graphical advertising," Coleman said.
But the Yahoo executive believes that it will take some time for either rival to get its stride in businesses where Yahoo has had deep experience stretching back to the 1990s.
"I am going to take advantage of the time lag," he said.
Opportunities also lie in cross-selling the two types of advertising to corporate customers who tend to prefer one or the other of the two online ad categories. Only 50 advertisers of the top 200 in either advertising category rely on Yahoo for both services, he said.
WRINGING MORE OUT OF AD INVENTORY
Exploding demand for brand advertising space means Yahoo and other major Web sites are facing sold-out conditions on key days even a year ahead of time across their sites, he said.
Yahoo is responding on two fronts by looking to vastly increase the number of desirable pages on which brand advertisements can be featured. These include not just the most popular destination on the Web, Yahoo's home page, but also major sub-sections, hot pages in its sports and finance sections and by adding ads to the crevices of Yahoo Mail.
The other approach is to further segment how customers make planned advertising buys months in advance.
Options Yahoo is looking at include charging varying prices for key advertising real estate at different times of day. The company might also introduce some form of upfront advertising sales as is common in the television business. Some form of bidding for heavily trafficked spots is inevitable, he said.