Will a Yahoo Google deal cost you more in PPC?
Yahoo’s search advertising agreement with Google could result in more than a 20 percent jump in keyword prices for advertisers, according to an independent report released Tuesday by SearchIgnite. This could make your search engine marketing budget skyrocket. The report claims the cost could go up as much as 22 percent. This would really cut into profits over time. On average, the cost per click for bidding on the same tail keywords on Google, compared with Yahoo, costs 12 percent more for the No. 1 position on a search result page, and as much as 28 percent more for the No. 5 spot.
An excerpt from the report:
“The price difference for bidding on tail terms on Google vs. Yahoo increases as the ad’s page rank decreases. Therefore, it would be economically advantageous for Yahoo to outsource a significant amount of their tail term inventory, paying closer attention to the outsourced inventory’s rank rather than the keyword terms themselves. Acting this way, Yahoo should be able to better monetize the majority of their tail terms with the Google partnership. ”
SEM folks should pay close attention to this deal. The same could be true if Microsoft buys Yahoo. Either way there will be one less major player in Tier 1 PPC.
