Words hold the key to Web ad packages

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Sponsoring search terms becomes a popular option

When Web Review's Erik Lundberg was planning promotions for a holiday shopping contest sponsored by his Web-based magazine, the first thing he did was buy the keywords "Christmas" and "present" on InfoSeek, a Web search service.

The move was a seemingly small step--words were $300 per month when he bought them in June--but keywords are a media buy marketers may make a lot more often this year to target online consumers.

Here's how it works: Users who search for the keyword "printers," for example, would see an ad from a printer company. An auto ad might appear during a search for auto sites.


InfoSeek this year will offer sponsorship of 3,000 words at premium prices, said Bill Peck, interactive advertising director.

Premium words will cost 4 cents to 10 cents per impression depending on the ad category. Other words cost 1.5 cents per impression. (An impression is recorded when a user downloads a page with an ad on it.)

At Yahoo Corp., 1996 rates will vary from 2 cents to 5 cents per impression, depending on the popularity of the word. Basic monthly rates are $1,000 per word.

Lycos, another Web search service, will sell keywords for $750 per month. Marketers also can sponsor keywords for 5 cents per impression.


Buying keywords by impression could be risky, however. Marketers that buy a popular word "could find it worse in that they don't know what that monthly bill will be," said Bill Townsend, VP-advertising at Lycos.

For editorial sites that offer search capabilities, like CMP Publications' TechWeb, selling by keyword carries the opposite risk: not enough traffic.

"The opportunity to segment by season, day of week, even time of day is there, but the cost of segmenting before you have mass is high," said Mitchell York, managing director of CMP Interactive Division.

Advertising on CMP's TechSearch service costs $1,000 per month for a combination of premium and regular words.


But what does an advertiser get for those words? Despite Info-Seek's claim that conversion rates on keyword buys range from 2% to as much as 36%, Mr. Lundberg, who's Web Review's director of advertising, isn't entirely convinced his purchase made a difference.

"The difference between [keyword-related] ads on InfoSeek and in other venues only showed a one-tenth percent response rate variance," he said. "I'm not as excited about it as I was."

Copyright January 1996 Crain Communications Inc.

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