Ready Or Not, Here Comes Panama: New Yahoo Sponsored Listings Ranking Model Coming Feb. 5th

Jan 24, 2007 - 6:53 am 1 by

We all knew that Yahoo! would be releasing the new ranking model for their sponsored listings in the first quarter of this year, but honestly, I am surprised it is towards the beginning of the 1st quarter. Word comes via a Yahoo Press Release that the new ranking model will be in place February 5, 2007 - that is right around the corner, less than two weeks!

So what do you need to know? Well, instead of reading my detailed notes on Panama, maybe you want a quick summary... A WebmasterWorld thread has a post by poster_boy with a great summary:

Here's a quick summary of this important change: * Both bid amount and ad quality will determine an ad's rank in search results beginning February 5, 2007. * This will replace the current method, in which ads in search results are ranked by bid amount only (bid-to-position). * This is designed to allow you to focus less on competitive bidding practices and more on the quality of your ads. * By improving the quality of your ads and making them more relevant to users, you may be rewarded with a better ranking and/or a lower cost for your ads.

What is "Ad Quality"? Ad quality is determined by:

1. The ad's historical performance - its click-through rate relative to competitors and normalized for position. 2. The ad's expected performance - determined by various relevance factors considered by Yahoo!'s ranking algorithms, relative to other ads displayed at the same time.

Overall ad quality is displayed in graphical form by the quality index.

Other Important Things to Know

* We recommend that you review your current max bids. Keep in mind you may be charged up to this amount. * Standard match type ads will no longer receive priority placement over Advanced match type ads. * Fewer Sponsored Search results may now appear at the very top of the page for certain search terms.

Now, there are a lot of advertisers that are not happy about the change. Honestly, Yahoo! had no choice, they had to make this change to compete. Overall, in my opinion, this is the best move for Yahoo! and the market, so advertisers will have to learn how the new Yahoo! bidding environment works and capitalize on that. Yes, change sucks - but it can also lead to many rich opportunities for you - so embrace it and take advantage of it.

Oh, Yahoo! also released their 2006 financial results, even though profit is down, profits did increase and the ranking model was announced also, and YHOO is up in pre-market trading.

Forum discussion at WebmasterWorld, Search Engine Watch Forums, DigitalPoint Forums and Search Engine Roundtable Forums.

 

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