July 1, 2007 11:20 PM PDT

Yahoo launches customizable ad tool

Yahoo just upped the ante in the display advertising space.

On Monday the Web giant launched a new display advertising product called SmartAds, which allows marketers to offer ads that are customized according to the Web surfer's age, gender, location and online activities.

For instance, instead of just seeing a generic ad for a Toyota Prius, a woman in San Francisco who conducts research on hybrid cars on Yahoo Autos could be served an ad for a local San Francisco dealer, along with information on the types of Priuses in stock and their purchase price. The ad, which is configured on the fly, could also feature a background color targeted for women in her age range, as well as a Golden Gate Bridge logo.

Someone searching for flights between Dallas and Phoenix, meanwhile, could be served an ad with specific up-to-the-minute fares from a particular airline, along with a button that says "buy now," all within the ad, said Yahoo spokeswoman Gaude Paez.

"We do behavioral targeting now," she said. "This makes display (advertising) more of a direct-response vehicle than just branding."

Yahoo SmartAds combines Yahoo's demographic, geographic and behavioral-targeting capabilities with a new patent-pending creative ad assembly platform that allows the company's ad system to create customized ads in real time. Yahoo will get different backgrounds, logos and other features from the creative agencies that can be reconfigured with ad copy based on who is seeing the ad and what they are interested in.

The company is launching ads with two major airline companies as well as some travel aggregators, none of which wanted to be identified, Paez said.

The ads will appear on Yahoo's network of owned and operated sites and eventually will be expanded to the newspapers Yahoo has partnered with, as well as Yahoo partners Comcast and eBay. Once Yahoo's purchase of online ad provider Right Media is completed, the companies will work to display the SmartAds on sites on Right Media's advertising network. Yahoo has agreed to pay $680 million for Right Media.

The move gives Yahoo, already the leader in online display advertising, an added edge over competitors and could eventually help offset slowing growth in display advertising. Executives warned recently that second-quarter results would come in at the low end of guidance.

Yahoo is in transition, struggling to reverse a slowdown in revenue growth and a stock price slide after losing the search and search advertising race with Google. Chief Executive Terry Semel stepped down in mid-June and passed the baton to co-founder Jerry Yang, shortly after getting blasted by shareholders at the annual stockholder meeting.

Yahoo's rivals aren't sitting still when it comes to display advertising. Google is buying online ad company DoubleClick for $3.1 billion, and Microsoft has agreed to pay $6 billion for Aquantive.

See more CNET content tagged:
Right Media Inc., Yahoo Launch, Yahoo! Inc., online advertising, San Francisco

11 comments

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360 degree effort is needed
This seems to be an interesting tool for advertisers since it would definitely reduce the spill. It?s always best to target, both contextually and behaviorally.

The only concern which I see here, as an online advertiser, is the volume of search done by my target group on Yahoo as compared to Google.

I did a search on Yahoo and Google for the same word - yahoo smartads. As a user, the results which I got from Google gave me a better understanding of this.

Though I would like to try and test SmartAds, hope it?s not too much of an experiment.
Posted by pallb (2 comments )
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Zimini already does this....
Yahoo might be late to the game again as there is a company called Zimini that already does this type of advanced targeting (e.g. geographic, demographic and interest-based targeting). Yahoo needs move more quickly to regain search leadership.
Posted by techforward (14 comments )
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Zimini?
The way zimini works and the way yahoo smart ads work is completely different. Correct me if I am wrong but, the way zimini works is you have to install a software on your desktop and select what your interests are and you'll be targeted with best deals. Now, that seems to me as a complete ripp off from newsletter subscription via email. On the other hand Yahoo Smart Ads will track your interests on yahoo and other properties and display targeted deals tailored based on things you were recently reading/searching. This in a way yeild more CTRs on display ads for yahoo. As an advertiser I don't see any value in placing ads in zimini where as Yahoo being second largest search engine with only 1.8 billion searches per month, more than 130 million unique visitors per month and the leader in display ads is definitely worth investing (for now).
Posted by flickrz (239 comments )
Link Flag
Privacy and Betrayal
How long before monitoring of online behaviour by Yahoo gets people in trouble again? Their partner in crime, AT&T, has already proven to be a danger to the those they spy on for the government and now the record companies want to know what we do. From copyrights to terrorism, Yahoo will collect our information, then turn in anybody like a chinese journalist for content they monetized. Whether you think you are innocent doesn't matter when people can make up crimes at a later date. Once the data is collected you're already guilty. Invasive marketing is a trick. Don't fall for it.
Posted by fed_up (4 comments )
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chinese journalists
But, don't you think even without that your identity is only a subpoena away? You are entitled to your opinion and paranoia but, it is always been the same. The moment we go online our info goes into hands of our ISPs, email providers and google. Besides, people are now sick of talking about jailing of chinese journalist. Why talk about chinese journalist/government when our own US government picks up people randomly from around the world and puts them in jail indefinitely without trial? Nobody talks about that. Why? So, when US government jail an innocent he is labeled "terrorist". why? US has jailed more innocents and kept them there without trial than chinese government so US should first clean up their own acts before finger pointing at other nations.
Also, it would be naive to think US government doesn't already monitor everyone's activities online.
Posted by flickrz (239 comments )
Link Flag
CityWaboo also dose that.
There is this website <a class="jive-link-external" href="http://www.citywaboo.com" target="_newWindow">http://www.citywaboo.com</a> that dose that also. their main goal is not to make things so complicated for the visitors to search for something. Thats why they try to keep the site as simple as possible. But if you do look at their tools and services, they had that planed since September of 2006. Its just that the site is on beta and it is taking them a while to get to where they need to be. But lets not forget that Yahoo is seating on money.
Posted by Armen100 (1 comment )
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Very lame site.
Enlighten me please. I went there and put in my city and state and it directed me to a packaged site that "supposedly" shows me all information about my city. What does this have anything to do with SmartAds? or you are just doing free promotion for the site. None of the categories have any listings either!!!! It seems completely rip-off. I can put more info using RSS feeds on my myyahoo or igoogle page than using this site.
Posted by niravabhavsar (74 comments )
Link Flag
Yahoo Ads Can Get Smarter
Smartads is Yahoo's attempt to leverage the depth of their online profiles with a more flexible creative solution. But does it really solve the big problem for the creators of advertising - how do we create mass personalized ads with a tool that is easy to use and integrates easily into our workflow. Can you really see the Guardians of the worlds leading brands accepting restrictions on their creative executions dictated by Yahoo's Smartad program? They will want total customization flexibility, across any creative element and across any medium. The folks at Qmecom have perfected this application and make it easy for agencies to create literally millions of unique versions of ads. Smartads might be Yahoo's solution today, but tomorrows solution will be Smarter Ads - and my guess it will be one of Yahoos competitors who will launch it very soon!
Posted by Founder_and_CEO (2 comments )
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Yahoo Being Smarter
Smartads is a good step forward, but its why Yahoo didn't land the Golden Goose Ad Serving company Double Click - they don't think as big as they should ! Customizing text and images within the confines of a pre-rendered template sounds impressive, but it significantly limits the potential of true customization. How about customizing as many creative elements of an ad that you think will deliver a more engaging message. Brand advertisers are calling out for this kind of direct response application to branded display advertising. The folks at Qmecom have perfected this application and make it easy for agencies to create literally millions of unique versions of ads. Smartads might be today's solution, but tomorrows solution will be Smarter Ads - and tomorrow is now!
Posted by Founder_and_CEO (2 comments )
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Smart Ads? Nothing new.
This has been done for years by a British company (www.connextra.com). Effective, but still limited to how banners work in general.

I don't see anything unique here for Yahoo that can't and won't be easily imitated by their competitors (i.e. Google, MSN).
Posted by smeyler (1 comment )
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