Yahoo Sprays “Network B Gone” On Class II Inventory And Classically Stumbles: Good Idea, Bad Delivery
Posted by Joanna O'Connell on December 1, 2011
It started with the retargeters. A couple weeks back, Yahoo decided to shut off stand-alone retargeters, like Criteo and Dotomi, who were sourcing cheap Yahoo inventory just to resell it at much higher prices. This was a clear effort by Yahoo to take back control of its display ad business, a move increasingly common among large premium media companies. Tuesday’s announcement, however, goes much further: Yahoo has told DSPs, networks, and other buyers of “class II” remnant inventory that they’re no longer welcome to buy. Rather, their end clients – the marketers and agency trading desks using their tools – will need to get their own direct “seats” (i.e., contracts) if they want to continue accessing this inventory through the Right Media Exchange (RMX).
Is this a good thing for Yahoo? In the long run, absolutely. It means it's getting serious about cutting out undifferentiated middle men and focusing instead on more direct, transparent, and mutually beneficial relationships with big buyers. So for that, bravo, Yahoo!
But there’s still a major problem: Yahoo’s track record is terrible when it comes to communicating and executing on big strategic shifts, and this move appears to be no exception. To be clear, this is different than past blunders like Yahoo’s now infamous APT launch or even the more recent – but still murky – YAM (that’s short for Yahoo/AOL/Microsoft) alliance, where massive PR and marketing blitzes led to generally underwhelming follow-through. This time, Yahoo has taken clear and decisive action, but without much grace or consideration for timing. Specifically, it has decided to spring a major ultimatum on big buyers right in the middle of Q4. If you’re buying through a DSP’s seat today, prepare yourself. Yahoo says it will shut you off, and soon, if you don’t get your own seat ASAP.
Here’s what I am wondering: has Yahoo prepared itself for managing the flood of contractual discussions this will prompt? And will it be able to turn around those contracts quickly, or will programmatic buyers be bogged down in months-long discussions, all the while unable to access Yahoo inventory? From what little we know based on public remarks to date, there are no clear answers. And Yahoo’s history of provisioning RMX seats means big buyers can probably expect a lengthy and complicated process.
So, if you’re buying Yahoo inventory through a DSP today, I encourage you to get involved in the conversation immediately by talking to both your platform and (if you’ve got one) your Yahoo rep to get a handle on the planned DSP seat -> direct seat migration road map. Don’t be afraid to weigh in – you’re the customer, after all.
Search Forrester's Blogs
Lead BT Transformation
Develop customer-obsessed strategies to drive growth »
Forrester's CX Index
Predict how actions to improve CX will affect revenue performance.
Measure the customer experiences that matter most »
Free On-Demand and Live Events
Latest events from Forrester analysts, online and in person. »