Interesting post on Clickz this morning.  Are the search engines going to start offering vertical search advertising?  Rebecca Lieb’s post cited a conversation with Tanya Singer at Yahoo! who indicated that such a move was being considered. 

Vertical search engines have had the upper hand on this up until now.  If an advertiser wanted to capture a vertical audience they looked to a specific content-rich market like a book store or a product-based site or even a LookSmart, which offers vertical search engines.  Or they go to another site that offers a concentration of users based on its searchable content.  But if the major search engines start to offer vertical search capabilities by site are all bets off? 

What would the impact be if Google, Yahoo! and MSN start making it possible to buy search terms within their finance, auto and personal sections only?  This targeted form of search would obviously offer the majors an opportunity to increase their fees, diversify their inventory and further strengthen their positions in the search market, but would it also dilute the vertical search concept?  Does it make it less attractive to an advertiser to go to the specialized sites and search engines who offer the vertical search targeting capabilities or will they still go there for the option of capturing the unique audience? 

At the end of the day my guess is that the audiences won’t change on these other sites and search engines based on the advertising models of the majors and so the advertisers will not change their media selections.  But if the majors offer vertical options, their rates will be impacted and that could have a negative impact on the pricing models for the advertiser.  If they can charge more for vertical search, they would likely reserve better inventory for that rate category.  So advertisers would end up paying more for the performance levels they are accustomed to.  Who knows that could actually push advertisers towards other vertical search options!

Let’s watch and see. 

Reactionary with Insight.

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