• by March 8, 2004

Yahoo!'s debut of a paid inclusion program last week wasn't all that surprising. But neither is the backlash on its decision not to specify the difference between paid placements and other content. Yahoo! advertisers that participate in the paid inclusion program will have their listings mixed in with other search results. In order to find out whether search listings have been paid for by advertisers, web surfers must click on a special button to access Yahoo!'s explanation.

The furor over Yahoo!'s program is starting to build, and it's legitimate.

The problem is that by mixing paid listings with natural results, consumers are likely to be confused, as Mark Naples pointed out in Friday's Online Spin. Apart from failing to engender consumer trust and goodwill, it's a shady business practice. And shouldn't the fact that Yahoo! isn't readily disclosing the difference between the two kinds of results bother marketers? After all, it's a matter of trust and anything that could potentially damage consumer trust, not to mention brand credibility, should always be a concern for marketers. Where are the marketers that are opposed to this practice--I have yet to see anyone come forward on the issue.

If Yahoo! hoped its newly boffo search capability will close the gap with Google, maybe it should think again. Google offers no paid inclusion program. It does offer marketers a paid search program, but the listings are separated from the majority of its search results. That's a good thing. Google, which continually emphasizes its position of staying true to the "user experience" and offering the most relevant listings, delivers sponsored listings on a cost-per-click basis and by click-throughs.

The lack of clear distinction between paid placements and other listings will almost certainly create trouble for Yahoo!. It's an issue that merits continuous attention from the Federal Trade Commission, which ought to come up with a solution for labeling and full disclosure.