It’s no newsflash that search marketing is reaching out to intersect other forms of advertising and promotion: Just think of Google’s announcement last week that it will start offering coupons in its local search results.
Yahoo! too is growing beyond the PC query. Late last week the company announced that it has partnered with go2 to offer search ads in go2’s mobile directory services, offering directory-style listings of restaurants, movie houses, emergency care and other local services on several major U.S. wireless carriers.
The partnership will extend Yahoo! Search Marketing to the mobile handset for the first time in the U.S. Yahoo! already offers sponsored search listings over cellphones in Japan and the United Kingdom and says it has conducted successful trials of the service in the U.S.
“We’ve launched something called the Yahoo! Mobile Traffic Center that will enable advertisers to launch an original [search ad] campaign specific for mobile,” says Michael Bayle, senior director of business development for Yahoo! Search Marketing. “They’ll have a choice either to bring that traffic to a phone number, which of course is a common denominator for users of mobile phones, or to their wireless Internet protocol [WAP] site, should they have one.
“Marketers who are local merchants may be more accustomed to driving traffic to a phone number. But marketers who have been in the mobile space for a long time—such as ringtone providers, game providers or wallpaper providers—will send traffic to their WAP sites and engage the consumer there directly.”
Both approaches will involve costs per click; Yahoo! isn’t yet offering a pay-per-call option to merchants looking to get mobile phone traffic.
As for how the listings will look, Bayle says that will depend to some extent on what types of phones consumers are using to access go2’s directories. The company has deals with Cingular Wireless, Sprint Nextel and Verizon Wireless, all of which offer a wide array of phones with different screen sizes.
But in general, the Yahoo! sponsored listings will feature the names of advertisers who are geographically and category-appropriate to whatever go2 search the user is doing. Those listings will appear at the head of the screen and the top of the search results page. (Again, the size of the screen will be one factor determining how many Yahoo! ads are delivered—along with the number of advertisers for a term and location, of course.)
Bayle says the paid listings will be clearly set off from the algorithmic results of the search, and probably associated with the Yahoo! name. Users who click on one of these ads will be taken to a “locator page” offering details of the business, such as address, hours of operation, and credit cards accepted. Depending on the marketer’s choice, that page will have at the top either a link to a WAP Web site or a phone number. In either case, the user will be able to click on that element and be connected right away to the merchant site or phone. With older phone models without WAP browsers, users will have to open a menu and click on the link or phone number from there.
Yahoo! will sell the mobile ads at auction, just as it does its general-search keyword ads, and does not have plans to set a minimum for bids. “Given the nascent nature of the space, we’re confident that the fairest price will be one set by competitors of the local merchants in the market,” Bayle says. “So at this point, we’re not going to set an artificial floor.” Those prices will float depending on the value advertisers find in the product, he says, and they might even change seasonally—perhaps going higher in balmy weather or when folks are out doing holiday shopping.
Mobile marketing is poised to take off, if you judge by the number of advertising agencies and search-marketing firms that have set up dedicated mobile-ad divisions. Its takeup by users and advertisers remains a bit more uncertain. Everyone’s sure the users will get there in time; but whether that time is now remains a question, just like the specific ad formats users and marketers will gravitate to.
Part of the uncertainty comes from the involvement of the phone carriers in mobile marketing. In the past, carriers have tread carefully for fear of alienating customers that they’ve spent a lot of money to attract. Most Web sites on the Web networks run by the carriers themselves—the ones most people access when logging onto the Web from their mobile phones—carry no ads, even when the same company’s open Web site might have banners or pot commercials. Carriers have historically been unwilling to let their users become someone else’s profit center.
But call prices are dropping, leading carriers to look for other revenue streams. Meanwhile, more content is coming onto the mobile Internet daily, and some users—especially younger ones—are showing a willingness to choose free services that may run a few ads over subscription-based ones.
Compared to Yahoo!’s straight search business, mobile marketing is “a very different ecosystem,” Bayle concedes. But he says Yahoo! has learned a lot about what works for mobile users and advertisers from its more than two years’ experience serving up ads to mobile phones overseas.
“We pioneered in the Japanese mobile market about two years ago in partnership with Microsoft, and we opened in the U.K. after that,” he said. “We’ve seen a lot of trial and error over there, and we’ve been able to work out some of the kinks. We got some guidance from our Japanese colleagues on what marketers are looking for from mobile and to apply that learning in Britain. Now this represents our first U.S. effort to let marketers access consumers directly on mobile.”
What’s not in doubt is that more U.S. users are coming to the mobile Internet all the time. A recent report from Telephia found that more than 34.6 million U.S. wireless customers accessed the Internet over their mobile phones in the second quarter of 2006. The largest portion of those — 6.5 million — used cellphones to check their Yahoo! Mail accounts.
