Stream Success: Yahoo! Rolls Out Stream Ads
It’s no secret that Yahoo! has struggled to compete against the Goliath that is Google in the search arena. So with Marissa Mayer at the helm, the company is steering their ad strategy in a new direction that aligns with their content streaming formula. Back in April, Mayer announced on her blog that Yahoo! would be rolling out Stream Ads. This ad format supplements the news stream structure the company incorporated on its homepage in February 2013. This change in layout resonated well with users, as Yahoo! saw an increase in unique visits, time spent on the site and user engagement; they even overtook Facebook claiming the #2 spot on April’s unique visitor list according to Fresh Data.
Yahoo!’s Stream Ads are intertwined with news content appearing after every 12 or so news stream stories. The program launched at a flat $0.05 CPC, but recently rolled out in a more traditional bidding model. Bids can now go as high as $2.00 and the entered bid is the cost-per-click that advertisers will pay. Rankings within this program are determined by a combination of quality (CTR) and bids. We are anxious for some targeting capabilities, assuming Yahoo! will integrate sophisticated contextually relevant or user based targeting. As I stated in my previous post, our tests with the program have been successful – despite the low CTR, the conversion rates and ROI are promising. How high will the CPCs go? This will determine long term success.
A sample of the Stream Ad format is outlined in red below:
Here are some things to keep in mind:
• More is Definitely More: If you devote more of your budget and submit more ad formats, Yahoo! will in turn grant more impressions and your ads will appear more frequently in the stream.
• Pictures: It’s obvious that your ad needs to include a picture to grab a user’s attention, but in the program’s preliminary stages, we have found that incorporating a relevant lifestyle picture is far more effective than tacking on your brand logo.
• Opportunity: Yahoo! homepage premium display space is expensive and Stream Ads provide a great opportunity for your brand to maintain a presence on the Yahoo! homepage without breaking your budget. The impression volume for these ads is significant! Ads are rolling out as well on Yahoo!’s other portal pages such as sports.yahoo.com and news.yahoo.com.
Yahoo! is being careful not to overload the stream with advertising; they understand that this format plays into user’s existing behaviors – people are visiting Yahoo! to consume content and the company has found a way to monetize this routine. In this new era of the company’s history they are finding their identity as a content source, and positioning Bing as their search arm. The streaming format seems to be working for Yahoo!, and it will be interesting to see if Stream Ads prove to be a successful advertising structure as the program evolves over time.