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Yahoo! and Google deal comes at a cost to marketers

Alex Christie

18 July 2008

With the price of petrol, food, electricity (in South Africa) sky rocketing, it now looks like online marketing will follow suit with reports that the Google/Yahoo sponsored search deal will increase Yahoo keyword prices.

The deal currently only
applies to the US and Canada but a rise in overall search
advertising costs is speculated following the news of a Google/Yahoo sponsored
search partnership, reports
Mediaweek.
US search company
SearchIgnite recently released a study
into the pricing impact of the proposed Google/Yahoo sponsored search
deal.

Titled “Potential Impact of Google-Yahoo Partnership &
Cost to Marketers” the study
(.pdf),concludes that Yahoo’s keyword ad prices should increase by an
average of 22 percent. This assumes a profit maximization strategy is
implemented.
Again this currently only
applicable in the US and Canada but its
worth keeping an eye on as its likely to result in search strategies being adjusted somewhere down the line.

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