Yahoo! and eBay form alliance on advertising -- but it's no big deal

Posted May 25th 2006 9:50AM by Brian White
Filed under: Deals, Rumors, Press Releases, Industry, Consumer Experience, Internet, Blogs, Competitive Strategy, Yahoo! (YHOO), eBay (EBAY)

Apparently the rumors from yesterday were, well, a little on the money. Yahoo! and eBay this morning announced a "web advertising alliance." That's a great phrase by the way. But let me re-phrase nonetheless: Yahoo! and eBay announce a strategic, web-based partnership to thwart Google's advances. That probably doesn't cut it with the PR people.

Yahoo and eBay will collaborate on web advertising directly on eBay's site, as Yahoo! will provide all the ads itself. Additionally, Yahoo! will also provide all the sponsored search text ads for complementary products on eBay auctions. And the bigger juggernaut of this announcement -- eBay's PayPal division will become the de-facto payment standard for all Yahoo!'s services, including services for its direct consumers, publishers and merchants.

Um, okay. All this makes for some nice press release-type material, but is it material? Having PayPal as the payment option for Yahoo! services just contributes more cash to eBay's coffers.

Having Yahoo! provide sponsored ads alongside eBay auctions is somewhat questionable. Do we even know from eBay how effective these are? What will eBay shoppers and sellers think of them? Sure, Google has made an entire business of this -- but in another realm, Internet search. The online auction marketplace could be different altogether.

This announcement sounds more like horn-blowing that anything of real significance to me. Ok, maybe it's a semi-story -- I'll give it that. But, Amey's post from yesterday holds true for this announcement -- I just don't think there is substance here.

Tags: EBAY, GOOG, Google

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Reader Comments (Page 1 of 1)

5-25-2006 @ 10:28AM

Timon said...

The companies will also develop and deploy "click-to-call" advertising technologies on Web sites, which is a product feature link included inside an advertisement allowing consumers to directly contact the advertiser to pursue a transaction.

5-25-2006 @ 12:56PM

ma said...

I don't think it's hornblowing.

I think it's about time ebay and yhoo combined to combat goog. Ebay and YHOO have been around a lot longer and are successful companies. I hope to God people don't pay attention to these blog comments.

You have Nike and AAPL.. NOK and GOOG.. now EBAY and YHOO. MY money is on EBAY and YHOO and a hope that you people who blog can cover other stocks and make more knowledgebale comments.

5-26-2006 @ 1:42AM

Joe Beaulaurier said...

Kudos for not following the "Yahoo & eBay join forces to battle Google" lemming pack.

5-26-2006 @ 10:27AM

Kris said...

I think that the alliance between Yahoo and Ebay is what both companies needed. Both companies need more exposure (in the U.S. and worldwide) to compete effectively against google and other internet auction sites. This alliance does not seem too expensive for either company and can only help both tremendously.