Yahoo Strikes Ad, Content Deal With Gannett

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Yahoo Friday announced a new advertising and content partnership with Gannett that will allow the media company's newspapers and TV stations to sell Yahoo inventory as part of their digital ad offerings.

Under the agreement, Gannett's 81 newspapers and seven of its broadcast sites nationwide will be able to package Yahoo ad space with their own online inventory using Yahoo's APT platform for delivering targeted display ads. Gannett will also provide editorial content across Yahoo properties including the home page through the initiative that will roll out starting this quarter and continue into 2011.

The deal builds on the newspaper consortium Yahoo launched in November 2006 and now encompasses more than 800 members including The San Jose Mercury-News, New Haven Register and The Dallas Morning News. To date, the consortium has sold more than 40,000 ad campaigns onto Yahoo totaling more than $100 million in sales to date, according to Lem Lloyd, vice president of channel sales at Yahoo.

"It's really in the last 18 months that we've gotten this up and running," said Lloyd, acknowledging the time it has taken to get local newspaper ad sales forces up to speed on its APT system and selling advertising into Yahoo. With the Gannett alliance (which doesn't include USA Today), he added that Yahoo is now working with partners that represent 75% of the country's newspaper circulation.

The APT allows local newspapers to target consumers according to geographic, demographic and behavioral factors in ads that appear on Yahoo properties from mail to sports to news. "So now Gannett's thousands of local representatives can put together digital ad solutions that involve newspaper and broadcast assets plus Yahoo," said Lloyd.

And with local advertising accounting for about half of the $245 billion in total U.S. ad spend, Yahoo is keen to capture a bigger slice of the pie by teaming up with local media outlets. While applauding the deal, Gordon Borrell, president of local media research firm Borrell Associates, said Yahoo may find it especially challenging to work with Gannett's TV stations, since the TV industry is even less accustomed to selling digital inventory than newspapers.

"Television hasn't been as threatened by digital as newspapers, and so hasn't reacted as aggressively in adapting," he said, adding that TV stations typically have smaller ad sales staffs than newspapers to begin with.

Borrell also noted that Yahoo's newspaper consortium overall has been slower to roll out than expected. "We've heard from a number of clients that implementation has been a bit slow, so they're still holding onto the excitement of the deal -- but there are so many newspapers that wanted to jump on, it has left many waiting [for training and technology] and that's led to unmet expectations," he said.

Lloyd, however, emphasized that that on-the-ground training is a key part of the Gannett deal. "It's not our goal to work with every local media co. out there," he said. "We're more about strategic relationship and putting muscle behind that deal to make it work. This is a big commitment from Gannett and from us."

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