DirectNavigation.com wrote today about a notice that went out to anyone who advertised with Yahoo or the its prior service GoTo.com, on its PPC program(s) anytime from May 1, 2000 until September 22, 2009.
That’s a lot of advertisers.
The class action arose out of a suit by advertisers against Yahoo, alleging that Yahoo:
“””breached its contract with its customers by allowing Yahoo! ads to be displayed in spyware, domain name parking sites (also known as bulk registration sites), pop-ups, pop-unders, and typosquatting sites. Plaintiffs brought claims for breach of contract, unjust enrichment, misrepresentation, civil conspiracy, and unfair business practices.””
According to the settlement each advertiser is entitled to receive the earth shattering sum of $20.
Right $20 USD.
The lawyers, well they are getting only $4,170,000.00, in fees, plus reimbursement of expenses of approximately $100,000.
But I digress.
Back to how this settlement is bad news for domainers.
In settling this case, Yahoo basically agrees to allow advertisers to basically opt out of the domain channel starting sometime next year:
“””Yahoo! has agreed to develop and offer a new ad placement option that will enable Yahoo! Ad customers to control where their Yahoo! Ads appear.””
“”The Ad Placement Option will allow Yahoo! Ad customers to specify that their Sponsored Search ads should be displayed only on websites and other Internet properties owned or operated by Yahoo!, and the websites of certain “Premium” distribution partners.””
“”Yahoo! has agreed to make best efforts to launch the Ad Placement Option as early as the first quarter of 2010, but in no event later than September 30, 2010.””
“”Yahoo! will maintain the Ad Placement Option for at least two years from the date of its launch.”””
Moreover Yahoo says this change will carry over to its deal with Microsoft.
“”Microsoft will agree to implement ad distribution controls on the Microsoft paid search platform””
The problem is that there is general perception that the domain channel is full of typo traffic and generally undesirable traffic, as alleged in the lawsuit.
Unless Yahoo ad executive are trained to understand and educate their advertisers as to the difference between opting out of the domain channel completely, rather than selectively, keeping ads up on generic domains geared toward their business, all domains will suffer.
By the way, if you were an advertiser and want to check in on that $20 windfall, you need to submit a claim online by March 22, 2010.
Another solid reason to develop domains with fresh and relevant content…and target companies through direct advertising sales.
Not hard to tell who the only real winners were here.
Also, doesn’t Google allow advertisers to opt out of the domain channel now? If so, how did that effect revenue when it happened?
WQ
Yes Google does allow it and parking revenues have gone down since.
We have no way of knowing how much of the drop was caused by the opt out as Google has never released any info on this, including what percentage of advertisers have opted out (I asked the Google rep this question at a TRAFFIC show and got a “we can’t tell you” answer).
However allowing the opt out can only hurt the domain channel, I see no upside to it.
Yes, the opt out feature will definitely hurt…but was trying to see if there was any kind of stats out there when Google did this…guess that’s a secret.
I wasn’t using Google then myself.
This is bad news for Domainers? Which Domainers are we referring to? Our industry is now like two parties going on at the same hotel. In one room, people are laughing, toasting drinks and having a great time. These are Domainers who did the work, developed their portfolios, built their own advertising base and answer to no one. However, in the other room, though packed, it sounds like a funeral – relatively quiet except for the occasional outburst of tears and the continuous sound of empty boxes of Kleenex being tossed into a garbage can. These are Domainers who still believe in the Google and Yahoo Gods and are trying to subsist off a forever diminishing revenue stream.
DJC – harsh, but rings true.
@DJC
I could not agree with you more. The importance of owning a business user channel name is oh so important! If you own domain names that do not double as both a business address and a keyword target address you are barking up the wrong tree.
Rick Schwartz has said many times that if your domain name addresses are not business oriented and targeted at the same time, GOOD LUCK.
Gratefully, Jeff
MHB,
Thank you for the great analysis of the article.
larry
David,
I never developed 1 domain and retired from PPC years ago. I know others that have as well. We “did the work” long before most were even talking about development.
There are those newer to PPC in the past few years that are hurting but most that have developed are hurting too.
You do not have to develop domains to make money online. PPC isn’t dead either. Our PPC revenue is down 50% over the past 1.5 years but even with that, we are still laughing, toasting drinks and having a great time. The money is still good, just not as good.
Your comment might sound about right to newbies but to us old schoolers, at least to this one, it sounds boastful and ignorant.
Don’t worry about passing the box of Kleenex this way.
Just sayin….
Between David and WQ I’m expecting plenty of free adult beverages when I hit the NY TRAFFIC show.
WQ:
Trust me, I have no doubt many of you old school domainers are still reeling in the dough. And I apologize if I sounded boastful. Wasn’t my intention.
Internet publishers should always be required to provide information to online advertisers as to placement; however, since this is unlikely to be provided in the bulk of the cases, it is up to web and mobile advertisers to negotiate ad placement in their online advertising contracts. Too many advertisers get into Pay Per Click (PPC) deals with little understanding of where their ads will appear. While I agree that this settlement is an embarrassment to most lawyers, it may serve to push internet publishers for more disclosure. — by Online advertising lawyer — http://www.web20lawyer.com/page0/page6/online-marketing-advertising-compliance.html
Web 2.0
You raise a few issues:
“”Too many advertisers get into Pay Per Click (PPC) deals with little understanding of where their ads will appear.””
I totally agree. Advertisers need to understand what they are buying and what they could be buying but not.
The more educated the advertiser is the better it is for everyone.
But the problem as I see it is that advertisers don’t understand domains and when they read statements made by lawyers which combine:
“spyware, domain name parking sites (also known as bulk registration sites), pop-ups, pop-unders, and typosquatting sites.”
Into one category and then ask “do you want to opt out?” of course advertisers are going to opt out.
Of course we know that not all domains are created equal and while a Lawyer advertising on PPC spending $20 a click to be listed under “trial lawyers” on Google search, would not want to pay $20 a click for his ad to appear under 3mn4is8.com they should want it to appear on triallawyers.com.
Of course for an advertiser to understand that they must be educated and who is going to educate them?
Yahoo sales reps?
No
They will just opt out.
As for as the legal fees, we all know that in the vast majority of class action claims the “plaintiffs” wind up getting a nominal amount, a coupon or voucher they can use for something, while the attorneys rake in millions.
I don’t think that embarrassing for lawyers that were involved, its just embarrassing for the legal system.
I for one would not weep for the slow death of PPC income. It’s a very flawed business model for those who focus on that source of revenue. Yes I agree there was plenty of money to be made say 5 years ago from ppc, now the revenue must be paltry. We need to go back to basics!
why do you buy a domain name in the first place? To develop or hold as an investment and sell at a later date in the future.
However, I just learned of a new site DomainAdvertising.com, rolling out a “Targeted” domain advertising platform, to significantly leverage domain traffic to brands and companies across all industries. They are a very big consortium investment company, coming from the outside with more sophistication and creativity than what we currently have in the domain industry. If they get it right, then that will make all the difference for domainers and goodbye Yahoo or Google dependency PPC income for good!
It’s another reason to develop the domains. Parking craze is over people. Those who are new comer to this business are safe and go directly to the right path of developing Domains.
Others got to catch-up on that.
No, wrong.
You do not buy domains to plop up a bunch of garbage and throw them all on some server, then ‘sign up’ with every sponsor you can think of and try and get rich for free.
You do not buy up every domain name that anyone else could possibly even remotely want, so as to hold it hostage and hopefully one day make it ‘big.’
And you certainly do not combine the above two.
Because anyone who does that is spamming, at least that’s what the very same people said who are doing exactly that.
And that’s why the lawsuit exists.