Semel “Laser-Focused” On Search Business

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Yahoo ended its fiscal year by announcing an early arrival for its Panama search advertising platform, and CEO Terry Semel thinks it will help their overall search business.

There is no sugar coating or cautionary talk from the embattled CEO about Panama, the project that may define the future of Yahoo. He called the disclosure that Panama would officially launch on February 5th “probably the most important news you’ve heard from us in a long time.”

Panama brings contextual relevance to Yahoo’s search advertising, in a big way. Yahoo ad placement has been defined by the dollar; pay more and get better placement. Meanwhile, Google’s slavish devotion to relevance has propelled AdWords to dominance and Google to search ad riches.

Semel summarized in his post on Yodel Anecdotal, Yahoo’s official corporate blog, what he believes Panama’s impact will be in their search monetization business:

Advertisers will have more control over and visibility into their campaign performance, giving them greater confidence in (and potentially greater return on) their investment.

It also means that the millions of consumers who come to Yahoo! to search for information on the Super Bowl, Lindsay Lohan or tax deductions will find text ads that are even more relevant to their searches. It’s a self-reinforcing cycle, a win-win for advertisers, publishers and consumers. And we hope for our shareholders, too.

Making shareholders happy will stave off the calls for a change at the top of Yahoo. Net income for the fourth quarter of 2006 fell in year over year comparison, and traffic slipped as well. A boomlet of profitability from Panama is virtually a necessity to keep the hounds of Wall Street at bay through the summer.

That laser focus Semel spoke of may have been broken up by the shining prism of Google’s ad success. In one little corner of the web, the Got Ads? blog noted how testing out Panama had left John K wanting a lot more from the service:

I’ve been using it for a month, and from a usability standpoint it’s not that great. Overall, I give it a C+.

Someday I’ll write a detailed post on my experiences with Panama, but this punchlist gives you an idea of how Panama usability feels incomplete…

•  Emailable reports missing! MUST HAVE! Need automatic daily runs of reports emailed to me in CSV format!
•  Can’t put a keyword substitution in the destination URL. This is limiting for tracking conversion. Hard to send subid’s directly to affiliate networks. Yahoo does have automatic keyword insertion, but the parameter names aren’t changeable.
•  It’s hard to find things. QUICK – how do you change your campaign daily spend limit? Not easy to find. Shouldn’t that be under “Campaign Settings” at least?

The list goes on for a number of other items, but the main idea is that Google has these issues addressed to a point where a marketer expects them to be.

Panama has been several years in the making. Unless advertisers find their experience much different than what John K experienced, this summer could see an unmaking take place in Yahoo’s Sunnyvale home.

Focused lasers that are aimed inaccurately can leave quite a burn.

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David Utter is a staff writer for WebProNews covering technology and business.

Semel “Laser-Focused” On Search Business
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