Marketplace Report: Google-eBay Ad Deal

Google will begin selling advertising on eBay with an aim of helping to connect buyers with sellers. Steve Tripoli of Marketplace talks with Alex Chadwick about the details of the new deal.

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ALEX CHADWICK, host:

Back now with DAY TO DAY, and news of a huge advertising deal between two of the biggest names online, eBay and Google. eBay, the online auction site, has hired Google to sell ads on pages seen by eBay users outside of the United States. Steve Tripoli from MARKETPLACE joins us.

Steve, why has eBay hired Google to sell these ads, and what is it going to mean to eBay and Google users?

STEVE TRIPOLI reporting:

Well, I guess it means, first of all, that eBay users get more ways to find what they want, which is good for them and good for eBay. But you know, Alex, this is also kind of a pilot project about future commerce. That's because people looking at these Google-sponsored ads, which are going to be next to the eBay products just like the paid ads next to your Internet searches now, they'll have an option known as click to call, and that means that if you have the Internet telephoning system known as VoIP, or voice over IP, and you're looking at one of these ads, you can just click on the ad and it will dial the merchant.

So the world of selling is always looking for news ways to not an impulse-buying opportunity get away.

CHADWICK: So if I have this right, if I'm looking, say, for a waffle iron online on eBay, Google might put an ad there for new waffle irons and call this number to get it.

TRIPOLI: That's right.

CHADWICK: Okay, well maybe that makes things easier for shoppers, I suppose, but what else is important about this?

TRIPOLI: Well, it's a way of getting folks used to using two new ways of doing business simultaneously. I spoke with Shar VanBoskirk, who's an interactive marketing analyst at Forrester Research near Boston, and she describes it this way.

Ms. SHAR VANBOSKIRK (Forrester Research): If this model would actually help consumers get used to using voice over IP capabilities and would also help them get used to using a click to call, where I click and I actually instigate a telephone call to an advertiser, that would be a very interesting trend that could trickle into other advertising models.

TRIPOLI: Of course that's if this works well. Now, click to call has had its problems in the past, but the thinking is that with two companies of this size using it, that will change.

CHADWICK: How about this phrase trickle into other advertising models, Steve?

TRIPOLI: Well, by that she means that this is a sign of how media is evolving. It's another way of expanding the traditional search engine model. Shar VanBoskirk says this goes beyond shopping on eBay. There may be a time before long when you can use a search engine like Google to find content or make a purchase while you're listening to the radio or watching TV.

CHADWICK: Don't Google and eBay compete in Internet payment systems and net-based phone services? Why this cooperation?

TRIPOLI: Well, there's money in it for both of them, and competitive advantage too. You know, Google gets to, you know, elbow aside Yahoo and Microsoft a little more for interactive supremacy, and eBay gets some international presence, which they need, and so they also get immediate money from the merchants who get these click-to-call transactions.

By the way, Alex, later today, coming up on MARKETPLACE, as the first anniversary of Hurricane Katrina approaches we'll examine how New Orleans' biggest company is still struggling to stay afloat.

CHADWICK: Thank you, Steve. Steve Tripoli of Public Radio's daily business show MARKETPLACE, from American Public Media.

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