The Search Marketing Advisor Newsletter Article: May 2004, Volume 3, Issue 1

Tawadros Tid-Bits: What Yahoo!’s CAP Program Means to Search Marketers

by John Tawadros, Vice President of Client Services & Technology, iProspect

Until February, 2004 Yahoo! had been serving its users search results that were provided by the Google search engine. In fact, searches on Google and Yahoo! had been virtually identical and indistinguishable for nearly two years. But with Yahoo!’s switch from Google’s results to those provided by Inktomi (a pioneer of the paid inclusion model) – and with recent the launch of Yahoo’s new Content Acquisition Program (CAP) to replace it’s previous paid inclusion program – search engine marketing has changed forever.

Yahoo! clearly recognized that they needed to compete head-to-head with Google to ensure their market share did not suffer further erosion. For this reason, they acquired Inktomi and Overture – an algorithmic based search engine that offered paid inclusion, and the leading pay per click search advertising platform. Another benefit from the acquisition of Inktomi was that their paid-inclusion component was Yahoos!’s answer to how to monetize its natural search results. And fortunately for Yahoo!, Overture had also just acquired AltaVista and Fast Search Technology and so was able to use the best of each search engine and paid inclusion program to create the Overture Site Match and Overture Site Match Xchange programs (OSM/X). Both of these fall within the larger CAP program umbrella.

How This Impacts Your Search Engine Marketing Campaigns: Remember, AOL and Netscape are powered by Google’s search results and both Yahoo! and MSN are dominated by OSM/X search results – meaning that both results from Yahoo! and MSN are mostly paid-inclusion based. So today, roughly 46% of all Internet clicks will come from a paid inclusion based search engine. And now, due to the launch of CAP, most of these paid inclusion results will be delivered on a cost-per-click basis.

This has a few important implications and risks:

Search marketers will need to set aside additional budget for this program due to the high volume of clicks produced by Yahoo!’s traffic volume (previously, paid-inclusion clicks from Inktomi came predominantly from MSN, but Yahoo! has tripled the traffic). that when clicked, do not lead to a conversion.
Search marketers must ensure that they are intentional in determining which pages of their website(s) they want to include in the OSM/X programs because they can each incur substantial charges.
Pages submitted through pay-per-click programs must be well optimized or the page will never attain any top rankings or significant traffic – remember, the program promises “inclusion in a database” not visibility or rankings on any keyword. Pages must still be properly optimized to ensure high rankings.

There are a few potential landmines that need to be considered as a paid inclusion program proceeds. Companies who decide to use Yahoo!’s CAP should avoid paying to submit pages:

that may accidentally attain rankings on keywords not targeted by your campaign – keywords that are entirely unrelated to the searching audience.
that when clicked, do not lead to a conversion.
for products that are out of stock – so that even when clicked, no conversion is possible due to the oversold condition.
for products where the pricing has changed, but that price change is not reflected in the price on the page found in the search results – resulting in the company having to honor an unintended discount. if the increased costs associated with monitoring, refreshing and updating the pages being fed into the index exceed the revenue generated by the conversions from those programs.

Conclusion:

The OSM/X database now powers search results for both Yahoo! and MSN which represents 46% of all Internet searches. While their emphasis on paid inclusion means marketers will need to set aside rather significant budgets for inclusion and cost-per-click traffic, the upside is that participation in this program ensures greater control over how the site is described in the search results, as well as better data on click-throughs by URL from the search engines through the iProspect reporting interface. The program ensures regular, frequent re-indexing and updating of the submitted pages. Best of all, paid inclusion means near-instant inclusion in the search index and if the pages are properly optimized, near-instant top-10 rankings for newly launched websites.

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