Google rising in display ads, but Yahoo leads as a 'starting point'

Google may be rising in terms of search relevancy and advertising reach, but Yahoo already leads other portals as a "starting point" site. So an industry panel today concluded these two titans may -- for now, at least -- be equals.

NEW YORK CITY (BetaNews) - While Google has built up a formidable presence in online advertising, up until its acquisition of DoubleClick finally closed, it hasn't really had a presence in display advertising, the more conventional approach to purchasing space from an available publisher. Both Yahoo and Microsoft, by virtue of timely acquisitions, had been leaving Google in the dust in that department...until now.

Such was the tone of the discussion today among search industry researchers in a panel discussion today at the SearchEngine Strategies Conference and Expo.

Analysts expect Google's display ad sales to be "going up exponentially from a very small base" with the European Union's decision last week to clear the remaining legal blockade for Google's purchase of DoubleClick, said Heather Dougherty, an analyst at Hitwise.

Meanwhile, Google has also expended a lot of effort over the past year on increasing the relevancy of user searches, noted Jeremy Crane, director of search and online media, Complete. Now, that investment seems to be paying off, since users are typically accomplishing Google searches more efficiently, using fewer search terms, according to Crane.

For its part, Yahoo is now honing in on a variety of ways to raise revenues as it continues to fend off the advances of Microsoft as an unwelcome suitor.

For instance, Yahoo CEO Jerry Yang recently articulated plans to focus on Yahoo's strengths as a "starting point." There, Yahoo is already the leader among all search sites as a "starting point," or destination site, according to Dougherty.

Dougherty attributed Yahoo's leadership in this space to the fact that Yahoo combines a search engine with other kinds of services, such as Web-based e-mail and user forums.