Monday, February 05, 2007

A Long-Delayed Ad System Has Yahoo Crossing Its Fingers - New York Times

Running to stay in the race 

In its simplest terms, Panama is Yahoo’s attempt to place ads in front of users that are more likely to be clicked on. Until now, Yahoo gave top billing to the advertisers who were willing to bid the most to have their ads listed alongside a particular search result.

Google has a different formula, which Yahoo is trying to emulate. It ranks ads on a mix of bid prices and relevancy to the user. That leads users to click on ads more frequently, and since advertisers pay only when a user clicks on their ad, Google, on average, makes more money on every search than Yahoo does.

Source: A Long-Delayed Ad System Has Yahoo Crossing Its Fingers - New York Times

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