Panama, Yahoo!'s new ad ranking system, was launched yesterday. Highly anticipated before by both advertisers and the company itself, the initial feedback is a bag of mixed feelings. The new system has been appreciated by users for the easy to use digital dashboard as well as tools for better insight into the campaign.
But Yahoo! has also drawn flak for introducing the "quality" factor into ad placement calculations, which is surprisingly followed by both Google and MSN for long now. Previously, higher bids in Yahoo! ensured higher placements. But with the introduction of the quality feature, waters have become murkier for advertisers.
However, according to a post at Search Engine Land, Tim Mayer, senior director, global web search at Yahoo! has said that:
The system is going to cause advertisers to work harder to make their listing more relevant, just as SEO's have been doing in the algorithmic section for a long time,
Equally valid point of view would be that the Yahoo! guys pondered "How is Google making as much as 4.5 cents to 5 cents while we make a meager 2.5 to 3." Allowing for the long time that Yahoo! took to notice the huge gap, they discovered that the answer lay in high quality, relevant ads.
Therefore, Panama makes it tougher for advertisers to be placed high unless they are really good. That is good news for searchers who will not be subjected to useless advertisements which have been paid for very highly. This is also good news for advertisers as this will help them raise conversion rates by forcing them to create more relevant ads.
Searchers can look forward to better results but they will have to use narrow, specific search terms. Time Mayer also says that relevant sponsored results will make "people will start looking at the results more as a whole, we hope," not as two distinct sets of results.