Tuesday, June 20, 2006

Why Yahoo is still not dead

I'm a fan of Google and frankly, I've always wondered why Yahoo is still around. I was given some evidence today of Yahoo's vitality via MarketingVox: "Yahoo Mail, MySpace Garner Half of Online Ad Impressions"

Yahoo Mail actually has 38% share of the ad impressions. What are ad impressions? Each time you see a banner ad online, that's an impression. Now if you think about all the places you see ads, the fact that Yahoo has 38% just in their mail property is amazing. That's like one TV network taking in a third of all the ads on broadcast television.

But being a numbers guy, I was at first impressed but then I tempered my own shock at this figure. Even if Yahoo has 38% of the ad impressions, that may not necessarily mean they are taking in 38% of the revenue. In fact, these impressions are more than likely not even close to premium inventory. How relevant are these ads when someone is just looking to check their email? They are probably selling these impressions at ridiculously low costs per thousand (CPM) rates. They do some behavioral targeting (more on that in another post) but that doesn't make the inventory that much more valuable.

Of course, no matter how low, it'll all add up to some real money. We don't know how much, but my wild guess is that Yahoo's market share for ad placement revenue is somewhere in the high teens.

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