Yahoo Still Has Friends on Madison Avenue

Yahoo may be struggling and in play, but it's not for lack of scale or a business model Madison Avenue approves of. The largest display advertiser still has the virtue of size in its favor, which goes a long way with agencies looking to make purchases online. And in display, Yahoo is still the name to beat.

Yahoo can press its advantages to combat the decline in display ad dollars online next year, according to ad executives who spoke to Ad Age today:

“Advertisers are looking at where’s the traffic, volume and value is today. And today is very positive for advertisers at Yahoo,” said Chris
Moloney, chief marketing officer at Scottrade, which in August was the top online-ad spender, according to TNS Media Intelligence. “Google is considered to be the 800-pound gorilla of the internet but it doesn’t have content the way Yahoo does. It receives a massive volume of traffic.”

Yahoo's impressive traffic numbers are still a boon to brand advertisers looking to make large-scale purchases online. According to those interviewed by AdAge, Wall Street analysts are undervaluing
Yahoo's stock by paying so much attention to its failures in search and social networking.

Its position as the top display advertiser should be a boon in the struggle for display dollars next year. "Yahoo has more levers to pull in this market than any competitor," says Joanne Bradford, Yahoo's new revenue chief.

The problem is that the margins are smaller for selling labor intensive display campaigns than with the automated process of purchasing search advertising. And of course there's the impressive ability of Yahoo executives to squander a good thing when they've got it as they might by, as Rob Norman, CEO of Group M Interaction, puts it, out Google Google by pursuing the automated market.

"The dominant gene in Yahoo is to think of advertising as a math problem -- machines talking to machines. If you reduce it to a math problem, we go to Ad.com."