As we have known for sometime, Yahoo have announced that they will be moving to a ‘quality based’ algorithm similar to that of Google and MSN adCenter on the 5th of February in the US. A copy of the mail can be seen below;
Bid Amount and Ad Quality will Determine an Ad’s Rank in Search Results Beginning February 5, 2007 in the U.S.
With new features like ad testing, geo-targeting and fast ad activation, the new Sponsored Search gives you more ways to connect with customers searching for what you sell.
On February 5, 2007, we are introducing a new ranking model in the U.S. that considers an ad’s quality and bid amount. The new model is designed to help you spend less time in bidding wars and more time creating the most relevant, effective ads, which can help drive better results for your business.
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 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:
The ad’s historical performance – its click-through rate relative to competitors and normalized for position.
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 a 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. Learn More
Standard match type ads will no longer receive priority placement over Advanced match type ads. Learn More
Fewer Sponsored Search results may now appear at the very top of the page for certain search terms. Learn More
Starting on February 5 there will be a transition period during which forecasting tools will accumulate more data about the new ranking model to provide better traffic estimates. Learn More
To learn more about the quality index, the new approach to ad ranking and helpful tips, please click here.
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Further Questions?
If you have questions, please contact our Customer Solutions department via the Support Request Form or call 866-YAHOO-98 (866-924-6698).
Its interesting to see from Yahoo!’s patent application that they are also considering calculating the quality/relevancy scale based on conversion data. This is something Google, so far, have stayed away from as it would provide an advantage to users of their conversion tools (generally small to medium search spenders) over others who use their own analytics tools.
An extract from the patent filed on January 18th 2006 states : “Features for the results from the sponsored listing database may be calculated to help determine which results are to be displayed……factors such as historical click-through and conversion data. Historical click-through data includes information on the number of times a user 110 clicks through to the advertisers’ site when the site is provided as a result. Conversion data includes information from the advertiser regarding whether the user 110 performed an action desired by the advertiser, such as making a purchase when the user 110 visiting the advertiser’s site”
I think conversion should be left out of the calculation for ad relevancy to create a more even playing field. What do others think?
Wilko
January 25th, 2007