Yahoo(s yhoo) today announced a revised news feed that adapts to your taste, based on what you like and what you share. The concept is part of the company’s effort to have its content streams evolve from big verticals like “Sports” and “Finance” into more a bespoke offering — a so-called “fluid graph” consisting of customized news topics alongside social updates from Twitter, Facebook(s fb) and so on.
It’s a nice idea but how does Yahoo plan to make money from all this? Recall that, under new CEO Marissa Mayer, the company has been on a media buying binge, laying out princely sums to acquire Tumblr and news app Summly. Meanwhile, though, Yahoo’s display advertising business, which is its bread-and-butter, is as anemic as ever.
According to the company’s VP of Sales, Patrick Albano, the advertising market has yet to catch up to the trends of personalized news and content — meaning that some of the same old ads will appear next to the sparkling new Yahoo pages.
Speaking on Thursday at the Native Advertising Summit in Atlanta, Albano acknowledged that the ads appearing on the updated News product are largely repurposed from other areas of Yahoo — search, display and so on. But he predicted that the ad industry will soon catch up and devote more resources to making custom ads.
“As the web becomes more relevant, our native ads will have to be even more relevant,” he said, adding that ad makers will have to put more emphasis on format as well as text and brand message.
Will all this result in a flurry of customized ads that revive Yahoo’s flagging display business? It’s too soon to say — “native advertising” achieved buzz word status months ago, but many people still aren’t sure how much is hope and how much is hype. (Though it’s worth noting that native ad progenitor, BuzzFeed, also unveiled a custom news stream for its app today).
Albano also said that Yahoo is working with Denny’s and dozens of other brands to develop ad options on Tumblr. He also pointed to Vine and Instagram ads by the likes of Lowes and LuluLemon to predict that “photo and video-based native ads are the next big thing.”