Where Display and Text Ads Meet

With the the economy in recession, many businesses have begun to re-examine how they spend advertising dollars. Suddenly, return on investment is becoming increasingly important in today's market. Since display ads typically have a lower direct return on investment than search ads, companies have been focusing advertising dollars away from display and into search based ads.

This has had a negative effect on companies like Yahoo who are strong in display type advertising and weaker in search related advertising. According to Yahoo's fourth quarter results, display revenue had dropped 2% while search revenue had increased by 11%. In response to this, Yahoo came up with a really amazing idea, which are "rich ads in search". Basically, now you can search for something on yahoo and instead of a sponsored text add popping up, a picture with, perhaps a company's logo, will be displayed at the top of the search results along with a text based link. Video also has been included in this new program.

While, this new source of revenue is still in the testing stage (only big name companies have been allowed to participate), I thought it was a pretty innovative way of getting your strength (display ads) to work with the current market (a market which is currently seeing a high demand for text ads).

If you want to read more about this business idea, the NYT has a great article on it here.