While Google controls up to 73% of the search advertising market revenue in the US, Yahoo has only 13%. On the other hand, Yahoo controls a third of the display market (worth $7.1B last year), while Google has barely made a dent in the display market, and most of its revenue comes from search, while Yahoo’s (not exactly stellar) revenues are far more diversified.
The days of Yahoo’s dominance, however, may be numbered. Google is whittling away at the perception of Yahoo’s display supremacy, and Yahoo isn’t doing enough to fight back in display or search, according to a survey covered by Ad Age:
“Perceptions of Yahoo are strong and are improving, but what’s surprising is how well Google’s display efforts have succeeded in creating equally strong perceptions on Yahoo’s turf,” said Advertising Perceptions CEO Ken Pearl. “Since positive perceptions lead to increasing ad revenue, it will be interesting to see how the online-display market plays out over the next several months.”
Other key findings from the survey include:
- Advertisers surveyed said that Yahoo was 29% better than the average, but Google was 43% better (compared to the 150 online media companies in the survey).
- Yahoo still wins out in marketing services, rated at 42% better than average. Google only got 7% better than average.
- Advertisers perceive virtually no difference between display ads audiences on Google and Yahoo.
- Google scored 19% above the industry average for customer service, while Yahoo ranked 9% above average.
Note that none of this says that anything has actually changed. Instead, the survey looks at people’s opinions—because, like the Revolutionary War, this battle is fought in the minds and the hearts (but this time it’s the minds and hearts of advertisers and consumers).
Meanwhile, Ad Age concludes that the best way for Yahoo to keep control of display is to do better in search:
Ironically, [VP of Analytics for Omnicom's Organic Steve] Kerho said he believes the best way for Yahoo to protect its display-ad business is to find a way to succeed in search. “When you look at how people consume media online, it’s search and display. Their ability to give end-to-end solutions is hampered if they have to outsource part of that,” he said.
New CEO Carol Bartz seems to see this as well. So far, she’s said that she realizes how key search is to Yahoo’s business.
What do you think? How can Yahoo maintain its control of the minds and the hearts of advertisers, and thus the display ad market?