Why did Yahoo choose Google over Microsoft for a search deal? The chief reason Yahoo executives cited was that the Google partnership let Yahoo continue to sell both search and display ads in package deals. Kellogg, a breakfast-cereal maker with a $1 billion marketing budget, just gave Yahoo's strategy a big vote of confidence.Kellogg's chief marketing officer Mark Baynes told a conference yesterday, "It's still relatively early in our learning, but analysis of the Special K initiative of the last 18 months showed digital media exceeding that of broadcast's return on investment." A large part of Kellogg's Special K success is a deal with Yahoo combining brand ads with search. Perform a search on Yahoo for "Special K," and you won't just find a simple sponsored text link to Kellogg's website, but a yellow box, a bit of text and a video ad. A brand ad, in other words — but one sold and placed like a search ad. Our Madison Avenue sources were skeptical about the notion of jointly selling brand and search ads, since advertisers often split those assignments between different agencies. Why pass up Microsoft's sweet deal for an opportunity that didn't exist? But Baynes, in dense CMO-speak, supports the idea that mixing search and brand advertising can pay off: "For the right opportunity, the [online] space offers fresh ways to commercialize new and existing brands, target specific audiences on needs more cost effectively." Telling, though, that an advertiser makes this argument more clearly and cogently than Yahoo's own executive team.
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