Yahoo and Bing change the rules of their partnership: What to Expect

Recently, some terms of the Yahoo and Bing partnership were renegotiated. This means that their definition of the “unified marketplace” of advertising on search engine results pages, (while it still exists in some capacity), is changing as we know it and we’re about to get a lot more clarity into performance and traffic volumes on Bing and Yahoo individually.


Welcome Back Yahoo

For those that have been in the industry for more than a few years, you may recall that in 2007 Yahoo once had their own ad management platform that served ads in Yahoo search results and other Yahoo content network sites called Panama. (I even remember getting my Yahoo Ambassador certification!) That system went away with the Bing-Yahoo agreement in 2008, after which all non-premium ads were served by the Bing Ads ad interface.

However, last year the Yahoo Gemini ad platform launched, with the primary focus being on mobile and native advertising that is independent of the 2008 agreement with Bing. Enter 2015 and the renewal of the Bing/Yahoo partnership. Now not only is Gemini completely covering mobile advertising on Yahoo, we’re also seeing a big impact from the addition of product ads on desktop and mobile.

Yahoo and Bing Partnership Change: The Impact

From now on up to 49% of ads on desktop devices on and Yahoo partners and properties will be served from Yahoo Gemini instead of Bing Ads. For mobile, 100% of ad space will be served from Gemini, which includes native ads and product ads. The rollout for this shift in traffic serving between Yahoo and Bing is already happening, with full impact expected to land around mid-July. The most important thing to note: if you’re on Bing Ads now and you do not start and run a parallel Yahoo Gemini account, you could lose up to 49% of your Bing traffic, depending on how much was being served from Yahoo and what type of ad units you’re utilizing. If your program is heavily reliant on product ads or mobile, you’re likely to see a drop closer to 49%. If you’re just running text ads, the impact could be far less. The issue is that reporting from the platforms does not provide what the current traffic split is between the two – nor historically what it was – so if you do not have tracking set up in a 3rd party system to see the difference between the MSN and Yahoo CPC referrers it will be hard to say what the size of the impact will be on your own accounts.

Enter Yahoo Gemini Product Ads

While the impact sounds scary, there is now a new ad unit to help drive better ROAS (return on ad spend) than that of text ads. Now in beta, but with a general rollout expected in June, Yahoo Gemini now does more than just serve the native ad units that they’ve been serving for the last year. The product ads unit is feed based and the feed is submitted via a Dropbox account, not FTP or API, and it looks like even with the general access rollout, that won’t change for a while, which means that feed files will be limited in size. Meaning that it’s not as buttoned up as the Bing and Google shopping offerings in terms of process just yet.

An additional thing to consider is that there may be more searches performed these days and more people using search than before on multiple devices, but it’s not like we’ve uncovered an entire population living under the US in tunnels that we’ve just introduced to the internet. Bing and Yahoo are essentially splitting up that 20-30% that Google doesn’t have, at least for now. Hopefully, a product ad unit will prove to be more powerful and engaging than the ad units Yahoo was serving in 2007.

Yahoo believes that they will be able to fill their gap of traffic inventory from the split with more ad units on Yahoo properties, syndicated search partners and the item of most interest: Flurry. Flurry is a mobile app analytics platform that they acquired in July of 2014. I am cautiously optimistic as far as what that means for in-app advertising, advertising apps and mobile advertising ROAS in general.

Bing, on the other hand, appears to be focused on quality and enriched search results, in order to compete (and in some cases win) against Google, as well as exploring other areas in which to compete in the ad game; including improvements in the Windows 10 launch and most importantly feature parity with Google AdWords. (Including, but not limited to shopping campaigns, upgraded URLs and close variant matching on keywords.)


The Cost of Doing Business

It really comes down to the cost in advertising dollars on this new platform. It could be argued a few ways, 1) do you assume that you’ll be able to take the existing budget you have now and simply re-allocate, since technically it’s the same traffic right now (if you don’t count the additional Yahoo ad units and properties) or 2) do you treat this as a new platform, like social advertising platforms such as Facebook, Twitter and Pinterest that may arise outside of your budget planning period?

The one thing you shouldn’t do is outright remove budget in large amounts. Each account is going to react to this transition differently, but you certainly won’t be able to ignore it. The most likely scenario is that some advertising dollars will be shifted and added, but the biggest shift will be in managing your programs as advertisers strive to capture the right mix of Google-Bing-Yahoo users. Ideally, if the return is there, the argument for advertising dollars makes itself. More questions? Drop us a line and we’ll be in touch right away!