Earlier this month, Yahoo! and Google announced their non-exclusive display partnership. And while this isn’t breaking news today, I thought we should take some time to reflect a bit more about what this actually means.
When reflecting on the announcement, my first thought naturally went straight to what the best celebrity couple name would be for this partnership – I settled on Yahoogle . My second, and some might argue deeper thought, was what this actually means for not only for the Yahoo!/Google relationship but also for the Yahoo!/Bing relationship.
For Yahoo! and Google we see a win/win for both players. Yahoo, who has had a 10% year-over-year decline in display ad revenue, wins because they will now be able to sell un-used ad space to Google with a simple split of the revenue. And because Google has such a substantial wealth of advertisers, Yahoo! will also benefit by having more targeted, relevant ads for their users which will drive their display ads to have higher clickthrough rates.
In this partnership, Google also wins more than just the split of the profit. They win the opportunity to display their ads across Yahoo!’s network of loyal users who are known to be actively engaged to with their content. The Yahoo! users trust this property’s content, which will ultimately lead them to drive more clicks, more conversions, and more advertisers wanting to spend their money on Yahoo!’s network through the Google’s Display Network (I’m certainly watching my placements, hoping to see higher conversion rates come in from Yahoo!’s network so I can bid up).
It seems pretty obvious that there’s something to gain for both partners. So obvious that upon the announcement of the partnership, Google saw a stock increase of 26.84%, while Yahoo! saw an increase of 27.29%. Yet another plus for both accounts.
So what does this mean for the Yahoo! Bing Network, otherwise known as Bing Ads? I’m going to go ahead and say that I don’t think it’s good. It wasn’t too long ago that the two launched a display network with Media.net. And what has that brought this partnership? A fairly large amount of un-used inventory that could be making them money. While this doesn’t mean that Yahoo! and Bing will be parting ways tomorrow, it does add another item to the list of Yahoo! Bing fails.