Changes to Yahoo Search Marketing - Big News!

As if to prove how quickly things can change in this industry, on Friday I wrote a blog post outlining strategies for Yahoo Search Marketing, which works on a different model to Google Adwords. That very same day (which was actually Thursday in the US) Yahoo announced their new search marketing ranking model, which will be launched on the 5th of February in the U.S and eventually rolled out over their entire network (including Yahoo UK and Yahoo Australia).

In a classic case of shoddy timing, it pretty much blows everything I said in my previous post out the window!

The big change in YSM's new model is that ad rankings will no longer be solely determined by the amount of money you're willing to lay on the table. Much like Google AdWords, YSM will now use a sort of quality index to determine an ad's rank. Quality will be determined by advertiser quality, relevancy, historical performance of the ad, and anticipated performance of the ad when compared with other ads that are running.



Yahoo's explanation of the new ranking system here.

So what does this mean for affiliates?

Good things:

• You might end up paying less for your ads if you can tickle Yahoo's quality standards the right way.
• You won't be trying to outbid advertisers whose ads/products aren't even relevant to the topic.
• It might lessen the amount of time you spend checking your listings to make sure you haven't been outbid overnight.

Bad things:

• If you're bidding on search terms that aren't completely relevant, or if your ad copy is less than completely appropriate, you might find yourself slipping in your positions (or paying more for the same position).
• Your landing page will now be considered when working out your Quality Index, although Yahoo say that the landing page forms just a "small" part of the quality index score -- compared with Google AdWords' emphasis, I guess.

The Quality Index:

Fortunately, unlike Google, Yahoo has designed their platform to be a bit more transparent. Advertisers using Yahoo's new "Panama" interface will able to see their ads' quality indexes (rated 1 - 5) as soon as they create the ads. Initial quality indexes are tempered over time by the ad's performance, and eventually  click thru rate becomes the most important factor.

Yahoo's explanation of the quality index.

Over at SearchEngineJournal.com someone has been nosing through Yahoo's patent applications, and extracted some interesting things that might also shed some light on Yahoo's method of working out quality index:

"Yahoo Search Marketing’s ‘Quality Ranking’ could look at these factors as being the most important:

    * Bid or Click Price
    * Historical click-through data
    * Conversion data
    * Organic Rankings of the said Advertiser URL
    * Whether the query word/phrase appears in the title
    * Keyword in URL
    * Keywords on Landing Page
    * Possibly other Keyphrases in Campaign
    * Comparison between other sites advertising for keyterm "
(http://www.searchenginejournal.com/?p=4306 )

The new interface:

I mentioned a new interface before... Yahoo will eventually be upgrading all advertisers to this new "Panama" interface, which will give advertisers a more informative view of their advertising campaign. A good overview of the new system can be found here .

Of course this is a huge step up from what was basically just a big spreadsheet full of ads before. Now we'll all be able to examine our Yahoo ad campaigns in all their nitty gritty detail, which is bound to excite the most statistics-obsessed amongst us. (That should be all of you!)

The big view:

It seems like Yahoo is making a big grab for the PPC market that Google has dominated with AdWords for the past couple of years. With more relevant ads giving searchers a better experience, giving better (maybe cheaper) listings for more relevant advertisers who create better ads, and giving advertisers better reports and statistics (as well as the ability to geotarget!) -- I don't think Yahoo Search Marketing is going to be gobbled up by the Google monolith anytime soon. In fact, in making themselves more like AdWords, YSM is likely to attract a lot more advertisers to their network because the learning curve won't be so steep.

Once the changes go live I'll be testing everything thoroughly and give you guys my own report. Affilorama members can definitely expect some videos! Until then ... if you haven't been spending much time over at Yahoo Search Marketing, it might be a good time to check it out.