Yahoo! recently made a huge change to benefit search advertisers by finally (after getting around intellectual property restrictions) allowing reasonable geo-targeting. Yet Yahoo! has not made a big deal about it. My data suggests that the prior lack of reasonable geo-targeting really hurt Yahoo! vs. Google among knowledgeable search advertisers. My data also predicts that Yahoo! search revenue could dramatically shrink because of it but this is necessary because prior Yahoo! search advertising costs were unnecessarily high before the geo-targeting initiative.
Yahoo! will have to prepare for lower search revenue while also considering unique patentable ways to get Internet users to choose it for search over Google. This could include a points system like that used by the credit card companies.
Categorised in: Dr. Dorfman on WSJ.com
This post was written by Dr. Jeffrey Dorfman