After months of speculation eBay has decided Yahoo, to be its third party advertiser on its site. And in turn Yahoo will use ebay’s Pay pal as its third party payment means. This was a set back for Microsoft and Google, who were competing with each other along with yahoo. Ebay, one of the largest online auction houses, were having talks with the three giants on the advertisement front and had decided on Yahoo.
Yahoo plans to use the Click to see method in these advertisements, where a browser can get in touch with the advertiser directly. This has come in the wake of situations when the shares of both the companies were not doing good. After this announcement, shares of eBay had increased by 12% while that of Yahoo to 3.5% (according to NASDAQ reports). What is the advantage of the partnership? Well it is a win- win situation on both the sides. While eBay known as the largest auction site online, had virtually no advertisement banners. By giving the rights of advertisement to Yahoo, it is into lot of advantage, for one it stands to gain by the brand name, second Yahoo has agreed to use Pay pal as its third party payment medium. As far as Yahoo is concerned, it has got a huge potential market covered, given the fact that many people connect to eBay everyday and secondly it has used its new innovative technology which is the click and play method of advertising.
Let us see how this partnership works. Well MSN and Google have to try other areas to implement their online advertising strategies. Given the huge amount of budget for expenditures, one wonders where Microsoft erred. But of course guys I can see a counter attack coming.