Google to Supply Search Ads to EBay
Web search leader Google Inc. will supply online auctioneer EBay Inc. with Web search advertising outside the United States, and the two will join forces on “click-to-call” ads that link online shoppers to vendors, the companies said Monday.
Paid search advertising lets marketers bid for ad space next to keyword search results.
EBay said that for international online text advertising, it would rely exclusively on Google instead of Yahoo Inc., which in May struck a parallel deal to handle EBay’s U.S. ads.
The contract is part of a string of deals for Google this month. The company also plans to begin testing an ad-supported Web video syndication system with Viacom Inc.’s MTV Networks, and it has struck a deal to supply ads on social networking site MySpace.com and other Web properties of News Corp.
The deal with EBay “is the most important of these areas,” Google Chief Executive Eric Schmidt said.
“You can now see Google’s strategy in each of these new markets,” Schmidt said of the MTV, MySpace and EBay partnerships. “These are very large businesses for us.”
The EBay partnership indicates that “Google continues to grow not only through rapid innovation but also through partnerships with premier online properties,” Oppenheimer & Co. analyst A. Sasa Zorovic wrote in a research note.
Financial terms for components of the deal involve revenue sharing, but the companies did not disclose details.
EBay said it did not expect the agreement to have a material effect on its financial results in 2006 or 2007. Analysts said the deal was also unlikely to have a material effect on Google during that period.
Through its deal with Yahoo, EBay has begun testing ads that appear when U.S. customers fail to locate what they want on an EBay auction search, EBay CEO Meg Whitman said.
The Google pact expands this to international sites.
EBay and Google said they would jointly offer click-to-call advertising using the instant-message and Web phone-calling services of two companies, EBay’s globally popular Skype and Google’s nascent Google Talk service.
Click-to-call merges advertising into e-commerce. It allows potential buyers to click on Web-phone ad links and talk directly to sellers or their representatives.
The technique is seen as a promising way to reach merchants or advertisers who may not have a website or who rely on potential customers finding them through Yellow Pages phone directories.
EBay shares rose 49 cents to $25.79, and Google shares rose $7.69 to $380.95.
