Usable Clicks

Yahoo! Rich Ads for Search Misses the Point

Today Yahoo! came into the agency to talk about their new Rich Ads platform. It’s still in private beta, but you can see a few campaigns live now by searching for Pepsi, Victoria Secret Pink, or Esurance.   By buying into the Rich Ads platform, you are guaranteed the top placement for a handful of your brand terms.  Within that new Rich Ad placement you can add: a) click-to-play video or images, b) deep-link to multiple places on your campaign website, and c) offer custom search boxes or form submissions.

All of this might sound pretty good, right? so why is my first instinct to declare this a failed offering?

It really comes down to the buy structure and the limitations.  For starters, the Rich Ad unit has to be purchased as a fixed cost, a hefty five-figure per-month buy for the privilege of running an ad execution on a search page in addition to your normal search campaign against only a few specific terms.  The visual execution is being considered a branding play, and is therefore not being sold on the standard CPC model that is the de facto standard in search.  Straying away from the cost-per-click model means the value proposition of search is being lost.  It means defending a new model that requires an added spend to clients when they are moving money to search in order to get away from the less efficient display media.

In their early blog post, Yahoo is quoting an increase in CTR of as much as 25% from standard search ads.  However, they don’t speak of the efficiency of the campaign, which is typically the more important metric in search, or how many clicks the Rich Ads are simply poaching from the natural search listings.  Presuming good natural SEO against branded terms, advertisers might just be paying for the privilege of poaching their own free clicks.

Second, brands can only opt into Rich Ads for brand terms that they have the rights to.  This means the competitive advantage of locking in the top spot and offering video right in the search results is only offered when someone is already searching actively for your brand in particular.  At that point, the user is likely already looking for your brand and already intent on going to a site to learn more about your product.  If the Rich Ads are being positioned as a branding play, what good do they do when you can only target users who are already well aware of and actively looking for your brand?

Yahoo! is in a tricky situation here.  By offering a fixed-cost program that guarantees brands the top spot and pushes competitors to the right, they are disrupting the pure auction model that drives the search marketplace.  This is likely why Yahoo! won’t allow advertisers to buy in against non-brand terms.  The terms that advertisers can purchase Rich Ads against have minimal competition if any due to legal restrictions to bidding against trademarked terms.  This means, again, the value of the Rich Ads to the brand itself is limited as well.  It may only at this time be beneficial to deliver a highly timely message such as an apology by a CEO after a public mishap that drives thousands of users to search for the brand to learn about the news.  Delivering a defensive message like this in a video as quickly as possible to the person searching could be more important than any effective cost metric.

The Rich Ads offering is still in beta, so the offering could change.  The type of ad and the sales method might all evolve based on advertiser and consumer feedback.  I’ll be watching it’s development closely, and I’m very interested in hearing whether others agree with my preliminary opinion, or am I missing the point?