Yahoo will partner with consumer reviews site Yelp in an effort to increase market share of local queries on its search engine -- a move that is likely to attract higher paid-search ad spending from brands. Yahoo CEO Marissa Mayer announced the news at an employee meeting Friday, according to reports, citing a representative who attended the meeting. The timing and terms of the deal have not been disclosed.
Increasing organic search traffic could mean additional paid-search advertising revenue. Mayer continues to push Yahoo toward mobile services and take greater control of the design and layout of
the Web pages. The company appointed Laurie Mann, senior vice president of search products at Yahoo, last year.
Although the search giant continues to struggle, the increase in local recommendations and business listings could reverse the company's fortunes.
Yahoo has a 10-year search agreement with Microsoft to serve paid-search ads on Yahoo's engine that the two companies signed in 2010. Under the terms of the deal, Microsoft gets 12% of the revenue Yahoo generates from paid-search ads appearing next to search query results. The Sunnyvale, Calif. company remains in control of the page layout and design.
The ability to pull in Yelp results will not pose a problem in Yahoo's agreement with Microsoft. But it does aim to drive more organic queries and traffic to Web sites that would likely prompt an increase in paid-search budgets on the site for both desktop and mobile.
Yahoo took 10.8% of the search market in December, compared with Google's 67.3% and Microsoft's 18.2%, according to comScore. Search ads comprised a little more than one-third of Yahoo's revenue, growing 8% to $461 million in the fourth quarter of 2013, after revenue payouts to Microsoft.