Yahoo may be trading short-term revenue for long-term opportunity with its new Yahoo Shopping offering, says Rob Gallo, consultant with Columbus, OH-based Retail Forward Inc. Yahoo last week announced that it is including results from non-paying retailers in its Yahoo Shopping search. In the past, Gallo says, Yahoo has gotten 15 cents to $1 per customer brought to a retailer's site, whether a purchase is completed or not.
Gallo notes that by including retailers that will not pay it anything, "it is likely that Yahoo will receive less per click on average than before." He reasons that by providing better information to consumers, Yahoo! is hoping that it will have more clicks because it will be able to attract more customers to its service. "This a new way of generating revenue," he says.
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