Yahoo! Search Advertisers Learn about Shrinkage

It’s been said that brevity is the soul of wit. For Yahoo! Search Marketing, brevity is also the key to user satisfaction and advertiser conversions. Starting Jan. 18, the search engine power will cut the text ads that appear in its “Sponsored Listings” blue boxes on top and at bottom of its search results pages down from 190 characters to a lean, mean 70-count.

The change will bring Yahoo! in line with Google’s recommended length for paid search ads, and also with the pilot pay-per-click (PPC) ad program taking shape at MSN Search, the new big kid on the block.

According to an e-mail notice sent out to YSM advertisers in mid-December, next week’s format change will “make the search results displayed on Yahoo! even easier for consumers to read.” The notice recommends that advertisers “begin your description with one short sentence that includes your keyword and focuses on your most important information in the first 70 characters.”

But the notice adds that advertisers don’t necessarily have to shorten their listings, because “they’ll be automatically shortened for you when displayed on Yahoo!”. And it goes on to explain that most of the Web partners that display Yahoo! paid-placement ads, including MSN, CNN ESPN and Infospace, will continue to show long-format Sponsored Search listings.

Basically the shorter ad format will take up less space at the top of the typical Yahoo! search results page. Right now, before the change, searchers on popular terms such as “digital camera” or “iPod” often see three bulleted “Sponsor Results” ads, each of which may run to 190 characters, taking up three lines of text (including title) and a fourth line for the URL. Adding that blue box to other top-of-page features Yahoo! offers, such as a line suggesting related search terms and another of shortcuts to relevant Yahoo! content sites, can result in as few as two organic search results appearing “above the fold”—that is, the bottom of the screen. Eye-tracking studies have shown that searchers pay much more attention to the results that appear above the fold and resist scrolling down the page.

While Google also offers a “sponsored links” box, shorter ads mean those listings each take up two lines (including the title), or at most two and a partial, leaving more room on the page for natural search listings. As illustration, a recent Yahoo! search on the term “skiing” showed 12 lines of sponsored listings at the top, a shortcut to Yahoo! Shopping and only one organic result above the fold; a Google search on the same term showed no sponsored links in the blue box and five organic results. (Comparisons are slightly skewed because users can see different results pages if they use applications such as desktop search or personalized news.)

“We release a lot of changes very iteratively over time—some of them pretty noticeable and others very subtle,” says Tim Cadogan, Yahoo!’s vice president of search. “This one will be relatively noticeable. The idea is to better lay out the page for superior scanability by the user, and to be able to see more search results above the fold, before the user has to scroll down the screen.”

Cadogan says that Yahoo! tested the shorter-format paid listings by serving them up to a selected “bucket” of users and tracking their movements, including scans, click-throughs and conversions. The results, he says, were enough to convince Yahoo! that shortening the paid ad format would create a more usable page for readers while still preserving advertisers’ conversion rates. If Yahoo!’s research proves out, the change may even increase ad click-through rates, he says.

Right now, ads that appear on the right side of the Yahoo! results page—the “right rail”, as it’s known– are limited to 75 characters. Since most advertisers submit one ad for both the blue box and the right rail, many of those side ads break off abruptly into ellipsis dots. Cadogan says cutting off blue box ads with an ellipsis may be one of the “automatic optimization” techniques Yahoo! uses on ads that don’t fit the new 70-character template.

He points out that Yahoo! will watch the downstream metrics for both users and advertisers after the change and may fine-tune the exact character count—upward, but probably not downward—to achieve the best outcome for both parties.

“We have users and we have advertisers, and we want to make sure we’re doing the right thing for everybody,” Cadogan says. “In general, the right thing for one is also the right thing for the other. When you give the user a satisfying search result, they’re going to be happier with the Web site they click to, whether it’s a sponsored ad result or an algorithmic result.”

Many search engine marketing (SEM) firms agree that the shorter, tighter Yahoo! search ads will be a good thing for advertisers. In fact, many firms have been advising their clients that even though they were allowed 190 characters of text in their Yahoo! ads, the strongest sales propositions should occur in the first 70 characters. Ben Perry, manager of paid search for iProspect, says this is because many of the content partners in the Yahoo! Publishing Network already run the shorter Google-sized ads.

“Some Yahoo! partners like CNN and ESPN make use of the longer description length,” Perry says. “But many of them, such as MSN [which still distributes Yahoo! ads alongside its own], are allowed to format them as they want and use the shorter descriptions. So if you’re running ads on Yahoo! and their content partners, you want whatever you say to pop within those first 70 characters.”

many. To this school of thought, marketers will benefit by being relieved of the task of creating search ads in a short form for Google and MSN and then writing another more than twice as long for the same search term or category on Yahoo! Recent research from the Search Engine Marketing Professionals Organization determined that about 46% of SEM advertisers placed with both Google and Yahoo!

Alan Rimm-Kaufman, whose Rimm-Kaufman Group LLC provides SEM help to online retailers, says his firm has customarily written both long and short ads for Yahoo! While the extra 120 characters weren’t exactly fluff, he says, they usually contained ancillary material about brands in stock, satisfaction guarantees or how long the retailer had operated—things off to one side of the primary sales message.

“For our clients, we’ve always front-loaded Yahoo! copy with the most important, strongest selling propositions because it would probably get shortened elsewhere on the network,” he says. “Seventy characters is almost crossword-puzzle-esque, but the Google model shows that it can be done effectively.”

Recent research from the Search Engine Marketing Professionals Organization shows that about 46% of SEM advertisers place ads with both Google and Yahoo! For these advertisers the change should prove “phenomenal”, says Danielle Leitch, vice president of marketing and analytics for MoreVisibility: It will save them from having to create two entirely different ads for the same search term or keyword category on the two top engines.

“From an ad perspective, more is not always better,” she says. “When you’re creating ad copy, it’s best to keep it concise, simple and easy to read. I think the shorter form serves that purpose best.” Advertisers who wrote to 190 characters on Yahoo! usually saw their text trail off in a cloud of ellipsis dots along the right rail. “If the important part of your message—‘free shipping’ or ‘10% discount’—was in the middle or at the end, chances are no one ever saw it anyway.”

Leitch says Yahoo’s move to shorter search ads may be motivated in part by a wish to introduce an element of standardization to a search industry that’s still searching for standards and short on shortcuts.

The fallout from the Yahoo! change may be more complex for some advertisers. While click-throughs may remain steady or even increase at the shorter ad lengths, some firms suspect that many of those clicks will be less qualified because the searchers don’t have as much information in the ads. As a result, they’re worried conversions to sales and return on investment (ROI) may suffer at 70 characters.

“We are going to be actively looking at bringing our bid prices down on Yahoo! Search Marketing, based on our belief that our conversion rates will probably go down for some of our clients. While we will not move our bids down until we have data and results, our hypothesis is that we will probably need to reduce our click prices to achieve the same ROIs for our clients.” While Daly says his firm “holds out hope that what Yahoo!’s telling us is correct,” they will also need to see metrics to show that conversion rates are sustained at the shorter ad length and thus the potentially higher click-through rate.

All the SEM experts say that mapping the Google short-form ads to the same keywords on Yahoo! could be an acceptable interim measure for coping with the new length guidelines, particularly for marketers who do their own SEM in-house and may not have time to build a Yahoo! ad from scratch by the Jan. 18 deadline. But they also recommend that advertisers then watch carefully to measure how those transplanted ads work on the Yahoo! network, which shows some significant performance differences from Google.

To Daly’s mind, advertisers need to go further and start learning to use Yahoo! all over again. It’s his expectation that everything they’ve learned in the 190-character past may not apply to the 70-character present. “Every advertiser needs to consider washing away their old data about Yahoo! performance and starting from scratch,” he says. “It’s not the same Yahoo! you once knew.”

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