The next time you see a video advertisement on Yahoo, it will most likely be tied to search data and other information that Yahoo has about you through a new partnership with Starcom USA.
Yahoo and Starcom have struck a deal to deliver video ads across Yahoo’s properties that are targeted at viewers based on audience data from both Yahoo and advertisers.
Yahoo has already launched other ad targeting products, but this deal marks the first time that Yahoo's consumer data will be used to determine which display or video ads to run.
“This is the first time we’ve combined data and insights about consumer behavior with an advertiser or agency who can also bring insights about consumer engagement with advertising,” said Andrew Snyder, VP of video sales at Yahoo.
To target the video ads, Starcom will help Yahoo combine its first-party consumer data with advertisers’ data to deliver “smarter” ads, explained Mark Pavia, EVP of digital at Starcom USA. Yahoo has “decades of data on how people look for content and they know how people consume content,” Pavia said. “What we can do is build rich profiles about the users so that the video content that might work well for them gets surfaced and it gets smarter.”
In September, Yahoo had more than 800 million monthly unique users. The targeted video ads could be rolled out as early as Q4, according to Pavia, and Starcom clients like Allstate, Kraft, Kellogg’s, Hallmark and others are potential launch partners.
Yahoo recently partnered with Viacom when it launched a new app, Yahoo Screen, that enables users to browse through video clips and online shows similar to the way people switch between TV channels.
But as Ad Age noted, Yahoo has made few deals with media agencies since Marissa Mayer took the helm. Under Mayer’s leadership, Yahoo has dedicated much of its focus to product development and acquisitions.
As Yahoo pursues increases in user engagement and traffic, it has seen its ad revenue drop. The company reported a 7% decline in revenue from its display ad business to $470 million between Q3 2012 and this year’s third quarter. During the third quarter, search ad revenues fell by 8% year-over-year to $435 million.
Yahoo’s deal with Starcom could be part of the company’s attempt to strengthen its bonds with advertisers and boost revenue. Snyder declined to comment on whether deals with other media agencies are in Yahoo’s future.