What does this mean?

This means that while Yahoo currently looks at the quality and relevancy of your ads by looking at your CTR vs your competitor’s on a keyword and rewards quality with higher rankings and lower costs, the new policy will allow advertisers to achieve a lower CPC than $0.10. Wow, that’s great news you say? Hold on, they’ll also try to determine for what they call the keyword “Value” by looking at how many advertisers are competing for that keyword and how much they’re willing to pay. If your keywords have a low quality or/and your bids don’t meet the minimum value – get ready to see some of your keywords become switched off (deactivated).

What should I do?

First thing, read up on the changes and Yahoo’s best practices. If you’re already focusing on increasing the relevancy of your ads and are maintaining optimized bids in your Yahoo campaign, the new changes should reward you. If you’re not, then expect to be forced to pay more to stay in the game or clean up your campaign. If you are affected negatively, the good news is that Yahoo provides grace period of a few days for you to raise your bid to keep the keyword active. You’ll be notified in the Dashboard via alerts and they plan to update the account interface to help track keyword status.

• Keep a close eye your top performing keywords – use the “watched keywords” feature to do this. If you can do this early, you’ll be able to quickly react to any minimum bid changes and minimize any negative impact
• Before simply increasing your bids because Yahoo tells you so, make sure it still remains within your acquisition targets and budget
• Above all, make sure you focus on relevancy and quality by having a well structured campaign and relevant ads.

Is this a good thing?

In short, yes. It will force advertisers to focus on quality ads and relevance that should improve user experience with Yahoo’s paid search results. We’re looking forward to seeing the impact of the changes. Let’s hope the implementation of this by Yahoo goes smoothly.

Can you give me an example?

Let’s say you sell a variety of cell phone brands and models including the Apple iphone and bid on both the following keywords, “buy cell phones online” and “apple iphone on sale”. Now let’s say that a potential customer first clicks on one of your ads after searching for “buy cell phones online” but doesn’t buy anything on their first visit to your site and then refines their search to “apple iphone on sale”, then clicks on another one of your ads and goes on to purchase an iphone on your site.

What you’ll see in the interface is 1 assist for the keyword “buy cell phones online”, and 1 conversion for “apple iphone on sale”. The system will track this trail of clicks, which Yahoo calls “lead events”, for up to 30 events over a 45-day period (if the cookie is enabled on the searcher’s computer of course).

Taking Advantage of Conversion Assists

Before the conversion assists feature was activated, you might have drastically lowered your bids or completely paused keywords that you thought had no value because they weren’t driving any direct conversions. Now, not only can you adjust your bids according to keywords that deliver direct conversions but now have the additional data to also adjust your bids for keywords that mainly assist other keywords in converting. What’s more is that you can also use this information to identify patterns where certain keywords are predominantly assisting others and test different messages in your ads to see if you can get these keywords to convert directly. You might be surprised to find some opportunities that you can start benefiting from immediately.

If only Google and MSN would activate this feature on their search marketing platforms…