Yahoo Rich Ads in Search: Paying A Premium for Brand?

Yahoo RAIS for Esurance

Last week, Yahoo publicly announced their new Rich Ads in Search (RAIS) program. Since at least the middle of last year, Yahoo has been testing a feature that would allow advertisers to add videos, custom search boxes or images to their traditional text search ads. According to the Yahoo Search Marketing Blog, the small group of advertisers who tested this last quarter "saw click-through rates rise by as much as 25 percent" along with "improved brand exposure and conversion rates".

On the surface, the concept piqued my interest. But as I learned more, the program seems more aligned with Yahoo's bottom line, than with those of their advertisers.

Initially, it appeared that the program might present opportunity to test and capture higher click-thru by using images to leverage brand awareness that has been generated by offline efforts. Unfortunately for now (the program is still in very limited Beta), Yahoo RAIS has limited the images, custom boxes and videos to "select" brand keywords. It's not available for incremental paid search terms where there's lots of competition for the traffic.

Search for "Staples" on Yahoo

As we've pointed out in the past, there's a distinct difference between traffic on your brand terms and traffic on your incremental (non-brand) search terms. If I search for a brand like "Staples" or "Staples Office Supply", I've likely heard about Staples from another source, before doing the search.

Fortunately for Staples, (and many retailers) the results pages for these brand searches are already dominated by Staples natural and paid search links. Clicking on just about anything on the page will get me to the Staples site. In these cases, the incremental value to the advertiser seems extremely limited by RAIS options. Perhaps most helpful for those in the midst of re-branding or logo change (Tropicana, anyone?).

I'd be curious to see how the CTR increase was measured by Yahoo for their test. Did the presence of an image increase the overall CTR of the SERP (meaning the total clicks on natural AND paid links INCREASED) or did the image in paid search simply attract attention and effectively move clicks away from the natural listing?

Anecdotally, we'd expect that having a presence on both paid and organic links for non-brand searches may help boost the overall SERP CTR for your ads, but I don't believe the same would hold true for branded clicks when the brand links are as omnipresent as Staples.

Even if I was in doubt about the incremental benefits of RAIS, it's probably worth testing, right? After all, brand clicks are typically cheap. Not so in this case.

Yahoo's been very quiet about the pricing for the program, but it doesn't appear to be charged on a cost-per-click basis - at least as it exists in Beta. Rumor has it there's a monthly fee to participate in the program that runs well into the five-digits!

If Yahoo would really like RAIS to work on a more broad scale, there are two changes they could make to create a more attractive program for advertisers:

Yahoo Search for "Office Supplies"1. Make the program available for any keyword, or at least any keyword above a particular traffic threshold. I'd love to test the incremental value in Staples placing their logo next to their ad for "office supplies", when the page is filled with competitive results. It should help to set their ad apart as searchers may recognize the logo from offline branding efforts.

2. Charge the advertiser a fair rate that they can tie back to ROI. Perhaps a distinct premium-per-click that they can opt in to, based on participation in the program. Whether it's an additional $.30 or 30%, the advertiser could then calculate their final CPC and understand the added value that RAIS is driving.

    Ultimately, Yahoo's bottom line will be best served by creating products that better align with advertisers' goals.

    Join the Discussion