New York — Struggling search pioneer Yahoo Inc. on Tuesday made a sales partnership with AT&T Interactive that enables the telecommunications powerhouse to sell Yahoo display inventory to U.S. businesses, the companies said.
The new alliance means that approximately 5,000 strong sales force from AT&T Interactive’s local sales affiliate with access to Yahoo’s APT platform and, will begin to sell Yahoo’s display inventory in local ad markets starting later this summer, the two companies announced Tuesday.
AT&T, with 1,500 workers in the Dayton area, and Sunnyvale-based Yahoo said the partnership adds Yahoo’s display inventory to AT&T Interactive’s local online advertising portfolio, and takes advantage of Yahoo’s audience reach and targeting technologies.
The group comprises of marketing agents who sell listings on AT&T’s YellowPages.com property, in addition to paid search placements and other local ads.
“Local businesses are seeking to drive in-store traffic, and our alliance with AT&T Interactive will help them target a local audience of highly engaged potential customers on Yahoo,” Jim Schinella, senior vice president, North American region at Yahoo, said in a statement.
Nevertheless, the deal comes as relief to Yahoo’s newspaper partners — more than 800 are involved in the consortium — roll out the APT platform. This alliance now enables newspapers to sell local Yahoo inventory and offer behavior targeting advertising to small and medium sized businesses.
“As local businesses shift their advertising spend to target the growing number of Internet consumers, AT&T Interactive and Yahoo can equip them with the tools and expertise they need to be successful online,” Schinella said.
“Our local advertisers are riveted on growing their business so they look to us to help find the most comprehensive and effective ways to reach consumers,” Matt Crowley, CMO of AT&T Interactive, said in a statement. “Adding Yahoo’s expanse through highly targeted display advertising enhances our existing portfolio of local advertising products, allows our advertisers another way to raise their visibility and reach more online consumers.”
The deal raises concerns about whether newspaper consortium partners might disapprove the AT&T deal on the grounds it could steal local inventory and advertisers from the newspaper sales teams.
Yahoo’s Schinella, defending the deal said it would not have that effect because Yellow Pages and newspaper sellers tend to court different advertisers. He noted Yellow Pages companies focus on services providers such as plumbers, dentists, attorneys, and florists, while newspaper companies focus more on retail and other product-oriented advertisers, and others such as entertainment advertisers.
The companies said “hundreds of thousands of local businesses, spanning thousands of business categories” have built online local advertising programs around AT&T Interactive’s yellowpages.com, online video ads, web sites and more. “These businesses can now add Yahoo’s targeted display advertising to their marketing campaigns through their relationships with the AT&T advertising solutions sales force,” the companies said.
“The newspapers and directory companies have competed in the same market for many years,” he said. “They do naturally gravitate toward different business partners.”
On his blog Content Bridges, Ken Doctor summarized the Yahoo/AT&T alliance in his words: “The Yahoo/AT&T deal represents new competition for beleaguered newspaper companies. Once AT&T sales reps got up to speed and that is certainly an intriguing question, given the newspaper company implementation experience, they will be competing head-on with newspaper reps.”
Anyhow, Yahoo is not the only display ad giant to set up a local sales partnership with a Yellow Pages sales force. AOL made a similar arrangement with IAC’s Citysearch, announced in early 2008, gives it a sizable footprint in regional markets. That deal also included an exchange of content, as AOL integrated user and editorial reviews, videos, and other content on Citysearch.
News of the deal came as Yahoo announced a 13 percent decline in second quarter revenues. While presenting Yahoo’s earnings call, CEO Carol Bartz boasted that the relationship means that Yahoo will now have 13,000 local ad sales reps located across the United States. She also said the company will increase its investment in products and marketing for the remainder of the year.
Both the companies said they anticipate Yahoo advertising to become available nationwide through a phased rollout. This partnership is the latest move in a longstanding strategic relationship between the companies.