Yahoo testing pop-under advertising

Ads hawking credit reports and a miniature video camera from X10 have begun launching in hidden browser windows on Yahoo's news and travel sites. A Yahoo representative told CNET News.com on Friday that the ads are a "test" as the company considers whether to sell pop-unders on its sites, which collectively draw one of the largest audiences on the Web.

The move promises to increase the number of pop-unders consumers see online--a figure that has already climbed into the billions, according to Dave Gross, a partner with Santa Barbara, Calif.-based Fastclick.com, which sells and serves the ad format for a growing roster of marketers.

"The fact that Yahoo is running (the pop-under) is pretty significant validation of its use," he said.

Although Yahoo has yet to fully endorse pop-unders, the experiment could add rocket fuel to a flare-up between Web surfers and unprofitable dot-coms over in-your-face advertising. Under pressure to maintain revenues, Web companies have begun offering reluctant advertisers new ad formats aimed at grabbing reader attention. But those formats have drawn barbs from some Web surfers, who say the ads detract from their Web experience.

Pop-unders, which automatically launch a Web page underneath an open browser window, have been at the center of the debate, thanks to campaigns on prominent sites such as The New York Times on the Web, AltaVista, MSNBC.com, the Chicago Tribune Internet Edition and GeoCities. Camera-maker X10's pop-under campaign made the company the fourth-most visited site on the Web in June, according to Web measurement company Jupiter Media Metrix.

The New York Times on the Web, one of the first mainstream sites to sell the ads, finished its campaign with X10 last week. Its newest advertiser for the pop-under is NextCard. New York Times spokeswoman Christine Mohan said the pop-unders have been a success, particularly for branding X10.

Ad executives downplayed the importance of branding, saying that pop-unders have become popular because of their low price and their similarity to traditional direct-mail campaigns, in which marketers blanket consumers with a promotion in the hopes that a fraction of those who receive it will respond.

More for less
Like low-end banner ads, pop-unders are cheap, making them attractive at a time when companies are trying to deal with an economic slowdown by slashing costs. Pop-unders cost on average $5 per thousand impressions, according to John Bohan, chief executive of online ad network L90.

Many of the campaigns using pop-unders are sold on a "cost per click" or "cost per acquisition" basis, which means the publisher gets commission on a consumer signing up for a service or buying a product in the event they acted on the ad. For marketers, this is an attractive proposition because they pay the publisher only when a consumer clicks the ad or buys the product.

"They're not beachfront property; they are like buying the back of the magazine or an infomercial running in the middle of the night," he said.

Flastclick's Gross said his company has served more than 2 billion pop-under ads since November, when it started running the ads. He said its ad volume has grown month to month an average of 93 percent. It has 20 active clients running ads on approximately 4,000 sites, most of which are small. However, the company has signed deals with Discover Card, NextCard, NutriSystems, Synapse and Network Solutions.

Most Web sites use a "frequency cap" on the ads that restricts the number of times they appear to once a day, to avoid annoying consumers. Despite such measures, many Web surfers have stepped forward to complain about the ads.

Lindsay Stevens, an events executive for a San Francisco-based marketing agency, says she's often disturbed by pop-under ads when using the Net for researching new projects.

"Getting a pop-under is really annoying, especially during the workday. If I'm sitting here doing research and writing up a proposal, it totally distracts me and my train of thought goes out the window," Stevens said. "I know they're providing a service and all, but hey, I didn't ask for it."

Some have even taken steps to bypass pop-unders with software such as Popup Stopper that blocks ads from displaying on their browsers.

"Pop-unders are a general annoyance, but besides that, I've learned to ignore them pretty well," said Mike Brittain, a graduate student living in Denver.

X10 pressing on
Despite consumer criticism of X10's ads, the wireless camera company is continuing its online marketing efforts. X10 did not return several phone calls seeking comment.

But a source familiar with the company said it has hired a seasoned media buyer to coordinate online advertising campaigns. The source added that the company is closing a factory in New Jersey to replace it with a larger one because of increased sales.

At least one Web study released this week tells a different story.

A report from Jupiter Media Metrix issued Thursday found that the format increases brand awareness, but at the cost of the company's image. It also found that 73 percent of consumers close pop-under windows after 20 seconds or less, indicating they do not lead very many customers to actually look into the product or service.

However, Gross defended pop-unders, saying they perform relatively better than banners in driving actual sales.

"All advertising is annoying to a certain extent, and the effectiveness of the pop-unders is driven by their ability to generate sales, not by their branding or traffic-driving effect," he said.