Overture Should Offer Advertisers More Choice

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The Yahoo-Overture partnership raises an important point: wouldn't it be great for smaller advertisers if they could turn their Overture advertising Overture, formerly known as GoTo, recently announced their search listings will be featured o­n Yahoo whenever someone performs a search. Overture has become a rare dot-com success story by allowing advertisers to bid o­n rankings within search listings. In turn, they have expanded the reach of their listings by partnering with other popular search engines, such as AOL, AltaVista, Lycos, Netscape and now Yahoo. When o­ne of these companies partners with Overture, they usually agree to feature the top three listings for each keyword as a subset of search results. These are known as Overture's Premium Listings. It is beneficial for advertisers to be listed in the top three because more traffic usually comes from partner sites rather than Overture's own site and results. In this case, Yahoo will be featuring the top five results, with three at the top of the page and two at the bottom. This raises an interesting question: Is Overture alienating their customers by requiring them to spend more money to be featured o­n partner sites? Being featured o­n Yahoo will no doubt increase traffic to advertisers’ sites significantly, but this traffic comes at a cost. Overture makes money by charging the advertiser when someone clicks o­n their link. Therefore, being featured o­n Yahoo will not o­nly result in an increase in traffic and potential sales, but also an increase in the cost to the advertiser. Overture had earlier been criticized when their minimum cost per click was raised from 1 cent to 5 cents. And at the same time, Overture increased the minimum monthly spending amount to $20. While this resulted in a significant cost increase for advertisers, Overture stated it o­nly removed advertisers that were not willing to spend a lot of money. o­ne could argue that they are doing the same thing by partnering with more highly trafficked search engines. For example, Overture's partnership e-mail announcement to current clients urged them to "make sure your business is listed in the top three positions" and "check that you have adequate funds in your account so your account will stay o­nline." Being listed in the top three positions requires outbidding the competition that is ranked above you, meaning your cost per click that Overture charges will increase. Overture stands to profit heavily from this, but some users, most likely small businesses with low advertising budgets, will not be able to afford to continue with Overture. Being listed there will generate large amounts of traffic, but the cost may prove to be more than they can afford. There is a way that Overture can avoid potentially losing advertisers: They should let users choose which partner sites they are featured o­n. This will allow the businesses that can afford it to be featured o­n sites that will get them the most traffic. At the same time, it will allow smaller businesses to continue using Overture listings to compete at a similar level. Please Click if you like this on google plus.