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WHAZ UP
2]
http://www.nytimes.com/2003/08/04/technology/04ECOM.html
Two Internet companies, Google and Overture, have made a brisk business of
selling ads that appear alongside Web search results. But so far, the big
customers for these ad services have been online merchants and operators of
search sites. Now, though, online publishers are beginning to sense the
possibilities of having Google or Overture serve ads to their audiences.
Publishers, including The Washington Post's Web site, which is owned by The
Washington Post Company, and the car-buyers advice site Edmunds.com, have
turned to Google or Overture to sell ads pegged to the content that each
visitor selects. When a visitor goes to the Book World page on
WashingtonPost.com, for example, the person is likely to see a text ad for
a self-publishing company or some other book-related advertisement, placed
there by Google's advertising service.
"This is a very important trend, particularly for Web publishers who've had
a hard time selling out their banner ads," said Jordan Rohan, an analyst
with the Soundview Technology Group, an investment firm. "This is the
bridge between Web content and search."
The new service is an extension of the bid-for-placement service pioneered
by Overture, in which marketers pay for their ad to appear atop search
results whenever an Internet user types a certain word or phrase. Under
that approach, when an Internet user enters "airline tickets" as a search
query, for example, the text ad of the merchant who has bid the most will
appear atop the results on Overture.com. The same approach works on
Overture clients like Yahoo Inc., which recently agreed to acquire
Overture, and the Microsoft Corporation's MSN. Bids range from a dime or so
to $1.50 or more for terms like airline tickets. The average fee is 40 cents.
A similar system is used by Google on its own Google.com site as well as by
clients that include Ask Jeeves Inc. and AOL Time Warner Inc.'s America
Online.
When serving ads for content sites, both Overture and Google employ
technology that infers the topic of a page by scanning for words and
phrases, searching through a database of tens of thousands of advertisers,
then delivering a relevant text ad. In some cases that is not difficult.
For instance, on Weather.com's golf forecast page for Norfolk, Va.,
Google's service - which it calls AdSense - can deliver ads for marketers
who had bid to have their ads appear above Google search results whenever
users type "Norfolk Virginia golf courses" or some similar phrase.
Joe Fiveash, the senior vice president for business and product development
at Weather Channel Interactive Inc., which operates the site Weather.com,
said that while the site had no shortage of large national advertisers, it
did not have the sales force or the technology to efficiently insert ads of
smaller advertisers in niches left open by the large advertisers.
Mr. Fiveash noted the prospect of finding local golf ads on the Norfolk,
Va., golf forecast page, and said: "We don't call on the Norfolk golf
courses. That's the gap we've been able to fill."
Neither the privately held Weather Channel Interactive nor Google would
disclose financial details of the advertising agreement, but Mr. Fiveash
said the revenue generated by the program "is certainly material to us."
The technology is not yet foolproof. The online edition of The New York
Post, which is owned by the News Corporation, ran an article last month
about a murder in which the victim's body parts were packed in a suitcase,
and Google served up an ad for a luggage dealer.
"We are working with Google to fine-tune this program," said Suzanne
Halpin, a New York Post spokeswoman. "We take it on a case-by-case basis
and do our best to remove inappropriate ads."
Susan Wojcicki, Google's director of product management, said the company
was learning from experience and refining its technology to recognize
situations where marketers would not want their ads to run, while also
letting publishers delete inappropriate ads.
Despite the occasional stumble, Ms. Wojcicki said Google's AdSense program
had performed well, both technically and financially. Google does not
release revenue figures, but Ms. Wojcicki said the company has attracted a
growing number of publishing clients, which it would not disclose. "We
believe it'll be a significant part of our revenue going forward," she
said. "We've seen a lot of demand from publishers who've not had an easy
way to monetize their pages."
Google's AdSense program is open to large and small publishers alike,
although publishers who serve fewer than 20 million pages to users each
month must use a self-service method to register and set up their pages to
accept the Google ads.
Overture, meanwhile, argues that a fully automated program like the one
Google offers is unreliable.
"Technology will never do the job of a human in making sure this ad makes
sense in this news story," said Bill Demas, Overture's senior vice
president and general manager of the partner business and solutions group.
Mr. Demas said Overture's service, Content Match, had a promising start.
The service was rolled out five weeks ago with five online publishers, and
last week added a sixth, Knight Ridder Digital, which manages 32 Web sites.
Knight Ridder Digital is a unit of Knight Ridder Inc.
Can Overture guarantee that its service will not place inappropriate ads on
the pages of its publishing clients? "Mistakes are inevitable," Mr. Demas
said, "but a high percentage of the time, we'll get it right." A staff of
nearly a dozen editors, he said, helps screen inappropriate ads, or those
that may violate exclusive agreements a publisher has struck with existing
advertisers.
As other search companies develop paid search capabilities of their own,
Overture and Google will have plenty of competition, analysts predict.
Indeed, they already face competition, most notably from Sprinks, part of
the About Inc. unit of Primedia.
Lance Podell, the general manager of Sprinks, said the company had taken
the guesswork out of placing an advertiser's message by requiring marketers
to bid on specific topics, like computer peripherals, that would appear on
a network of online publishers, rather than simply choosing key words or
phrases. Mr. Podell acknowledged that such an approach could possibly
result in inappropriate ad placements. But he said they could be found and
fixed more quickly than on Google and Overture, because the ads appear on
discrete categories of pages, not on all possible pages of a publisher's
site. Advertisers also have a mechanism to pause their ads immediately if
they see an incorrect placement.
The approach is a variation on what the industry refers to as "contextual
advertising." Since its debut last October, Sprinks has attracted clients
like CNET, iVillage, Forbes.com, America Online and CBS MarketWatch.
Sprinks may have been among the first to employ this particular technique,
but the concept of contextual advertising has been an elusive goal of
online marketers for years. During the dot-com boom, advertising companies
like Doubleclick tried to use personal information and other data to
display ads more closely aligned with a consumer's interests, but were
rebuffed by privacy advocates and an unreceptive advertising market.
Now, contextual advertising is becoming the norm, as more newspaper Web
sites, among others, require readers to disclose personal information, then
track their surfing behavior to understand whether readers may be
interested in buying, say, a car - and if so, what type might fit their
budgets.
Combining such information with a visitor's search queries would seem to
promise more relevant ads for consumers and better responses for
advertisers. Stephanie Krebs, marketing manager of ForRent.com, an
apartment listing service operated by Trader Publishing, said she began
advertising with Google's AdSense in March, bidding on thousands of terms
like "apartment" or "apartment for rent in Dallas."
Ms. Krebs said that Google did not disclose which publishers had run her
ads, and that only about 0.5 percent of users who see the ads click on
them. That compares with 3.5 percent of those who see them on Google search
pages. But of those who do click, she said, about 12 percent actually turn
into ForRent.com customers, compared with about 10 percent of those who
come from Google.com. "So," she said, "it's definitely working in the
positive for us."
http://www.nytimes.com/2003/08/04/technology/04ECOM.html
Two Internet companies, Google and Overture, have made a brisk business of
selling ads that appear alongside Web search results. But so far, the big
customers for these ad services have been online merchants and operators of
search sites. Now, though, online publishers are beginning to sense the
possibilities of having Google or Overture serve ads to their audiences.
Publishers, including The Washington Post's Web site, which is owned by The
Washington Post Company, and the car-buyers advice site Edmunds.com, have
turned to Google or Overture to sell ads pegged to the content that each
visitor selects. When a visitor goes to the Book World page on
WashingtonPost.com, for example, the person is likely to see a text ad for
a self-publishing company or some other book-related advertisement, placed
there by Google's advertising service.
"This is a very important trend, particularly for Web publishers who've had
a hard time selling out their banner ads," said Jordan Rohan, an analyst
with the Soundview Technology Group, an investment firm. "This is the
bridge between Web content and search."
The new service is an extension of the bid-for-placement service pioneered
by Overture, in which marketers pay for their ad to appear atop search
results whenever an Internet user types a certain word or phrase. Under
that approach, when an Internet user enters "airline tickets" as a search
query, for example, the text ad of the merchant who has bid the most will
appear atop the results on Overture.com. The same approach works on
Overture clients like Yahoo Inc., which recently agreed to acquire
Overture, and the Microsoft Corporation's MSN. Bids range from a dime or so
to $1.50 or more for terms like airline tickets. The average fee is 40 cents.
A similar system is used by Google on its own Google.com site as well as by
clients that include Ask Jeeves Inc. and AOL Time Warner Inc.'s America
Online.
When serving ads for content sites, both Overture and Google employ
technology that infers the topic of a page by scanning for words and
phrases, searching through a database of tens of thousands of advertisers,
then delivering a relevant text ad. In some cases that is not difficult.
For instance, on Weather.com's golf forecast page for Norfolk, Va.,
Google's service - which it calls AdSense - can deliver ads for marketers
who had bid to have their ads appear above Google search results whenever
users type "Norfolk Virginia golf courses" or some similar phrase.
Joe Fiveash, the senior vice president for business and product development
at Weather Channel Interactive Inc., which operates the site Weather.com,
said that while the site had no shortage of large national advertisers, it
did not have the sales force or the technology to efficiently insert ads of
smaller advertisers in niches left open by the large advertisers.
Mr. Fiveash noted the prospect of finding local golf ads on the Norfolk,
Va., golf forecast page, and said: "We don't call on the Norfolk golf
courses. That's the gap we've been able to fill."
Neither the privately held Weather Channel Interactive nor Google would
disclose financial details of the advertising agreement, but Mr. Fiveash
said the revenue generated by the program "is certainly material to us."
The technology is not yet foolproof. The online edition of The New York
Post, which is owned by the News Corporation, ran an article last month
about a murder in which the victim's body parts were packed in a suitcase,
and Google served up an ad for a luggage dealer.
"We are working with Google to fine-tune this program," said Suzanne
Halpin, a New York Post spokeswoman. "We take it on a case-by-case basis
and do our best to remove inappropriate ads."
Susan Wojcicki, Google's director of product management, said the company
was learning from experience and refining its technology to recognize
situations where marketers would not want their ads to run, while also
letting publishers delete inappropriate ads.
Despite the occasional stumble, Ms. Wojcicki said Google's AdSense program
had performed well, both technically and financially. Google does not
release revenue figures, but Ms. Wojcicki said the company has attracted a
growing number of publishing clients, which it would not disclose. "We
believe it'll be a significant part of our revenue going forward," she
said. "We've seen a lot of demand from publishers who've not had an easy
way to monetize their pages."
Google's AdSense program is open to large and small publishers alike,
although publishers who serve fewer than 20 million pages to users each
month must use a self-service method to register and set up their pages to
accept the Google ads.
Overture, meanwhile, argues that a fully automated program like the one
Google offers is unreliable.
"Technology will never do the job of a human in making sure this ad makes
sense in this news story," said Bill Demas, Overture's senior vice
president and general manager of the partner business and solutions group.
Mr. Demas said Overture's service, Content Match, had a promising start.
The service was rolled out five weeks ago with five online publishers, and
last week added a sixth, Knight Ridder Digital, which manages 32 Web sites.
Knight Ridder Digital is a unit of Knight Ridder Inc.
Can Overture guarantee that its service will not place inappropriate ads on
the pages of its publishing clients? "Mistakes are inevitable," Mr. Demas
said, "but a high percentage of the time, we'll get it right." A staff of
nearly a dozen editors, he said, helps screen inappropriate ads, or those
that may violate exclusive agreements a publisher has struck with existing
advertisers.
As other search companies develop paid search capabilities of their own,
Overture and Google will have plenty of competition, analysts predict.
Indeed, they already face competition, most notably from Sprinks, part of
the About Inc. unit of Primedia.
Lance Podell, the general manager of Sprinks, said the company had taken
the guesswork out of placing an advertiser's message by requiring marketers
to bid on specific topics, like computer peripherals, that would appear on
a network of online publishers, rather than simply choosing key words or
phrases. Mr. Podell acknowledged that such an approach could possibly
result in inappropriate ad placements. But he said they could be found and
fixed more quickly than on Google and Overture, because the ads appear on
discrete categories of pages, not on all possible pages of a publisher's
site. Advertisers also have a mechanism to pause their ads immediately if
they see an incorrect placement.
The approach is a variation on what the industry refers to as "contextual
advertising." Since its debut last October, Sprinks has attracted clients
like CNET, iVillage, Forbes.com, America Online and CBS MarketWatch.
Sprinks may have been among the first to employ this particular technique,
but the concept of contextual advertising has been an elusive goal of
online marketers for years. During the dot-com boom, advertising companies
like Doubleclick tried to use personal information and other data to
display ads more closely aligned with a consumer's interests, but were
rebuffed by privacy advocates and an unreceptive advertising market.
Now, contextual advertising is becoming the norm, as more newspaper Web
sites, among others, require readers to disclose personal information, then
track their surfing behavior to understand whether readers may be
interested in buying, say, a car - and if so, what type might fit their
budgets.
Combining such information with a visitor's search queries would seem to
promise more relevant ads for consumers and better responses for
advertisers. Stephanie Krebs, marketing manager of ForRent.com, an
apartment listing service operated by Trader Publishing, said she began
advertising with Google's AdSense in March, bidding on thousands of terms
like "apartment" or "apartment for rent in Dallas."
Ms. Krebs said that Google did not disclose which publishers had run her
ads, and that only about 0.5 percent of users who see the ads click on
them. That compares with 3.5 percent of those who see them on Google search
pages. But of those who do click, she said, about 12 percent actually turn
into ForRent.com customers, compared with about 10 percent of those who
come from Google.com. "So," she said, "it's definitely working in the
positive for us."
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