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| UPDATED: 2006-05-12 |
 Online Ads Reach The Crossroads 
By: David Utter 2006-05-12 As three prominent Internet companies fight harder for the paid search dollar, the brand advertising market faces a new threat, and it comes from the advertisers themselves.  "Why should we pay you when we can do it ourselves?" could be the question asked by powerful brand name companies. For firms like Google, Yahoo, and Microsoft, the answer may be an astonished look of shock.
One part of online advertising could become a land of confusion. Display ads, purchased on a cost-per-impressions basis, have been marketed to big-name brands for premium prices. Those ads run in very visible locations on pages within a site's network, whether it is the Yahoo home page or across Google's myriad network of AdSense publishers. Publishing 2.0 blogger Scott Karp, also managing director of research and strategy for Atlantic Media, suggested "advertising is in a death spiral" and the time of advertising supporting content providers will draw to a close. Philips (PHG) demonstrated how it can create advertising and content for a product called the Norelco Bodygroom. It isn't a facial razor, but a razor for everywhere else. And it isn't an advertisement that, despite its humorous overtones, would run on TV. It can run on the Web, though, and probably achieve a brief viral status as people visit it to see what the fuss is about. That illustrates the point being made, though. There is no premium priced ad on MSN's homepage, or an orchestrated CPM campaign dominating the AdSense blocks of Google Network sites everywhere. Philips offers just one example of companies engaging agencies to build advertising and keep the content within their sites. How are they driving traffic to the ad? Word of mouth has helped, but Philips also hedged its bets by purchasing keywords with Google that bring up a top-of-page sponsored link to the site when searchers look for "Philips shave everywhere." Yahoo balanced out its recent financial quarter with display ads offsetting a loss in paid search revenue. Google of course blew away analyst projections, and 99 percent of its revenue comes from advertising, mostly with paid search. Microsoft has been feverishly unrolling its adCenter self-service ad product, to formally launch in a month; its focus will be on paid search ads. Quick quiz: which company will suffer the most if more brand names keep their display ad campaigns to themselves? Right now it looks like Yahoo. However, Terry Semel and company may beat the devil at the crossroads of online advertising, if their newest search algorithms improve the relevance of the ads they serve on the Internet. --- Tag: Advertising Add to | DiggThis | Yahoo! My Web | Furl Bookmark IFN - 
View All Articles by David Utter About the Author: David Utter is a staff writer for InternetFinancialNews and WebProNews covering technology and business. |
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