Yahoo acquires Dapper

Dapper provides a platform for creating dynamic display ads, as Yahoo shows weakening ad impressions

As Yahoo! licks its wounds after several of its SVPs have left in a massive management overhaul, it refocuses its energy on ads (perhaps looking to get back on top?).  The company announced late Tuesday that it had agreed to acquire Dapper, a technology platform for creating dynamic display ads.  The platform allows advertisers to build dynamic ads that leverage data (what is happening on a website) to automatically display the most relevant product or message to the viewer.  In other words, user behavior prompts certain ads to display depending on the context of a website, thus delivering ads based on user intent.

For example, if a user browses a page on refurbished laptops, only ads related to laptops will appear, which will change if the user begins browsing a different page on desktop PCs or tablets.

“Smart Ads” have been on the rise as of late.  Recently, Adchemy launched its new WordMap program for search engine marketing, which condenses keywords in ad campaigns to include variations (words that indicate size, value, use, and more) so that relevant ads appear based on user intent.

The acquisition is significant in that Yahoo had, until fairly recently, been on top of the display ad game.  In May, Yahoo sites as a whole were vanquished when comScore revealed that more banner ads were displayed on Facebook than any other website in the first quarter of this year.  Facebook’s total display ad count for the first quarter was 176.3 billion, while Yahoo came in second with 131.5 billion, followed by Microsoft with 60.1 billion.  In the first quarter of 2009, Facebook came in behind both Yahoo and Fox Interactive Media (parent company of MySpace).

So it appears as though Yahoo is looking to annex the potential at Dapper to recharge its display ad game.  Dapper’s display ads also auto-optimize in real time.

According to Yahoo’s press release, the acquisition is expected to strengthen Yahoo’s Smart Ads: “The acquisition builds upon Yahoo!’s current display advertising leadership and will accelerate the adoption of Yahoo! Smart Ads. Yahoo! currently partners with Dapper, along with others in this space, and owning this technology will help the company deliver innovative solutions to an even broader range of advertisers and integrate dynamic ad serving into key Yahoo properties.”

The terms of the deal were not disclosed, but in 2007, Dapper raised $3 million in series A funding led by Accel Partners and Mitch Kapor.

Dapper could not be reached for comment.

It will be interesting to see whether or not this acquisition improves Yahoo’s numbers in the display ad race against Facebook.

Image source: dapper.net