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2008 has not been a good year for Yahoo. Microsoft's failed acquisition of the company was a royal mess and led to a showdown with shareholders.

CEO Jerry Yang and other board members aren't very popular. And in what essentially amounts to an admission that it simply can't compete in certain areas, Yahoo is planning to turn over part of its search advertising business to Google.

But Yahoo executives still haven't lost faith and a new product has them making bold statements.

APT is a new display advertising platform that Yahoo will launch later in the year with its more than 700 newspaper partners. A larger roll-out will occur in 2009.

Yahoo's press release describes APT:

"As a Web-based solution with the potential to allow unprecedented ease of cross-selling across the largest open network of publishers, advertisers, ad networks and agencies from a single integrated interface, APT is a single platform for connected digital advertising, including ad serving, ad network and ad exchange. It is designed to streamline advertisers' ad-buying process for multiple accounts across multiple publishers, and enable creative testing and campaign optimization.

"It is also intended to help advertisers precisely yet easily identify audiences through geographic, demographic and interest-based targeting while enabling publishers to better monetize their content as well as making better connections across the Web."

As reported by AdWeek:

"At the heart of Apt is the ability for advertisers to easily find their desired audiences on Yahoo! and hundreds of other Web sites. The Internet-based platform is designed to take the headaches out of buying, selling and measuring digital advertising."

Hillary Schneider, the EVP of US Operations at Yahoo, isn't mincing words. She stated that the launch of APT will be a "seminal moment in the industry." According to AdWeek, Yahoo executives are "likening its effect on advertising to the advent of color television and introduction of the DVR."

Those are some big claims.

The $64m question, of course, is - will it really work as promised?

There's no doubt that there is a lot of room for improvement when it comes to ad-buying processes.

And Yahoo's attempt to give advertisers the ability to shift advertiser focus from discrete properties to "audiences" is an interesting one. If the APT platform can accomplish this, Yahoo just might have something.

Yet whether APT will live up to the expectations Yahoo has set is questionable in my opinion for several reasons:

  • Yahoo was extremely optimistic about its much-hyped search marketing platform, Panama, yet that has largely been a flop, as evidenced by its capitulation to Google. Yahoo's ability to execute is therefore a valid concern.
  • Because of the situation with Microsoft and shareholders, Yahoo has seen its fair share of chaos as an organization this year, giving rise to the possibility that Yahoo rushed APT. It's also possible that the internal drama at Yahoo was not beneficial to APT's development.
  • As AdWeek notes, it appears that APT may provide more benefit to publishers than advertisers. Obviously, advertisers will also need compelling reasons to buy in to APT.

All of this said, Yahoo does have some things going for it:

  • Yahoo has always been stronger on the display advertising side and therefore predicting the failure of APT based on the failure of Panama may not be entirely deserved.
  • The pressure it faces in the wake of Microsoft's failed bid may have given Yahoo the kick in the arse it needs.
  • Yahoo's huge audience coupled with the large audiences controlled by its newspaper partners is extremely attractive and if the APT platform gives advertisers better access to those audiences, it will be hard to ignore.

At the end of the day, the success or failure of APT boils down to one thing - execution, execution, execution.

Yahoo has proven that it can still produce the hyperbole. As APT rolls out over the next year, we'll see if it has the ability to successfully implement big ideas.

Drama 2.0

Published 1 October, 2008 by Drama 2.0

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