Sponsored Links Extend Their Reach

Google and Kanoodle give online publishers options for incorporating sponsored links into everything from Web pages and e-mail newsletters to Weblogs and RSS feeds.

Sponsored links may be a mainstay alongside search results and on Web pages, but the advertising format is increasingly appearing in new places and taking on new forms.

Faced with advertisers who want to place more ads and publishers who seek more revenue, sponsored-link providers such as Google Inc. and Kanoodle.com Inc. are trying out approaches ranging from putting sponsored links in e-mail newsletters and syndication feeds to letting users choose the ads they read.

Sponsored links have been credited with helping to revive online advertising. They work in an auction model where advertisers bid on the keywords or topics that will trigger their ads. Advertisers then pay a per-click rate based on the number of clicks on a listing.

Just this week, Google confirmed that it is testing a refinement feature for its AdSense contextual ad program for publishers. The feature, appearing below the sponsored links on an unknown number of publishers sites, allows a user to change the AdSense results by clicking on a series of similar keywords or by entering a search term.

A Google spokesman declined to provide details about the test.

"Were always looking for new ways to give publishers new features, and this is a test and is a result of those efforts," the spokesman said.

Googles latest tweak, though, follows a broader shift in sponsored links. Publishers are incorporating the ads into more of their online content.

/zimages/6/28571.gifRead more here about Googles plans to give advertisers more access to its ad system.

About a year ago, Google quietly began placing AdSense ads into the e-mail newsletters of publishers with which it has direct relationships. Meanwhile, competitor Kanoodle, a New York-based startup, plans to widen its publisher options this year by letting them choose among various types of sponsored links that are targeted to a pages content, user behavior or local information.

Google began offering AdSense for e-newsletters because of demand from publishers, said Brian Axe, a Google product manager. The ads work similarly to the contextual ads that Google offers for content-heavy Web sites.

They can be added to HTML-based newsletters. When a reader opens the e-mail, AdSense returns sponsored links based on the context of the content in the newsletter, Axe said.

"Its essentially a no-brainer to add this to existing newsletters, and they get incremental revenue without having to do anything," Axe said.

Google plans to eventually expand the newsletter option beyond its direct AdSense partners to include the smaller publishers who use AdSenses online self-service program.

"Its a goal, but we havent put any dates around it," Axe said.

Next Page: A broader approach from Kanoodle.