The groundbreaking Web auction site has been experiencing slowed growth in its auction business, but continues its push into text-based advertising and click-to-call functionality.
Posted Aug 28, 2006
Ebay and Google have entered into a multiyear deal that will make Google the exclusive provider of text-based advertising for eBay outside of the United States The increasingly competing companies didn't disclose specific financial details, but did say that the financial terms for certain components of the deal involve revenue sharing. The companies also plan to integrate and launch click-to-call advertising functionality. Ebay and Google plan to begin testing the text-based advertising and click-to-call initiatives in early 2007.
The click-to-call announcement, according to Leslie Ament, director of the Customer Intelligence Research Practice at Aberdeen Group, is "a welcome step in allowing advertising to directly track the ROI from their marketing investments." According to the companies, users can click on a link or icon within a product or service advertisement to initiate an Internet voice call to participating eBay merchants or Google advertisers directly from either company's sites. Skype (acquired by eBay last year) or Google Talk are the call methods on offer. Skype will tender its users the option to download the Google Toolbar, to which Skype will add a custom button. The companies will also explore interoperability between Skype and Google Talk via open standards, to enable text chat and online presence.
Companies like eStara, a provider of hosted voice-enabling B2C communications solutions, specialize in click-to-call capabilities. Other companies that deliver click-to-call functionality include LivePerson and VOIP5000's wholly owned subsidiary Clixme. Ebay at this time doesn't expect the agreement will have a "material impact" on its financial results in 2006 or 2007.
"We're pleased to expand our long-standing relationship with Google to explore new market opportunities, like click-to-call advertising, that benefit both our communities of users," Meg Whitman, president and CEO of eBay, said in a statement. "People continue to evolve how they shop, communicate and advertise online. By combining the power of eBay in ecommerce and Skype in communications with Google's leadership in search and advertising, we can increase the usefulness of the Internet for shoppers, merchants and advertisers around the world."
"This agreement underscores how much we value eBay as a partner," Eric Schmidt, CEO of Google said in a statement. "Our technologies will allow us to connect users to relevant advertising across eBay's international properties. By working together to promote click-to-call functionality through Google Talk and Skype, we are offering advertisers another innovative way to connect with customers."
The deal is the latest in a cluster of moves to get more ads on the radar of Internet users. Microsoft announced last week that will be the exclusive provider of banner advertising and sponsored links on Facebook, and Google announced on August 7 that it will be the exclusive search and keyword targeted advertising sales provider for Fox Interactive Media's MySpace.com, among other Web properties.
It also comes three months after eBay unveiled a similar partnership with Yahoo!. Under that multiyear agreement Yahoo! was tapped to become the exclusive third-party provider of all graphical advertisements throughout the eBay.com site, and selected PayPal to be integrated and promoted as Yahoo!'s payment solution to Yahoo!'s merchants and publishers. Other elements of the deal include integrating Yahoo! Web-search functionality and Yahoo! site links into a cobranded version of the eBay toolbar, and exploring and deploying click to call advertising functionality on their Web sites in the U.S.
Ebay "is testing the waters in both the US and aboard with this strategy," Ament says. "It makes perfect sense for them to assess the return on their investment through "A/B testing"--similar to what direct marketers have done for years when sourcing, coding and measuring ROI from various lists they've utilized for campaigns."
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