Yahoo is wasting no time in leveraging its $1.1 billion acquisition of Tumblr, using the blogging platform to roll out sponsored web posts next month. The ads will integrate with user’s streams, which, until now, were only populated by user content on desktop versions. In-stream ads in Tumblr's mobile app have been active since last month.
The new dashboard ad units will be similar to the mobile ads currently on display, which are distinguishd by a small dollar sign in the upper right-hand corner of the post. Users can share and favorite the ads, which won't appear more than four times per day. Tumblr claims that the in-stream mobile ads have been shared more than 10 million times since launching in April.
Yahoo's first big step in increasing the monetization of the popular blog site is also the biggest concern of faithful users, many of which who supposedly jumped ship to other platforms soon after news of the acquisition was announced. “Tumblr has to make sure to carefully manage velocity—i.e. pacing of introduction so as not to alienate users,” Vik Kathuria, managing partner at GroupMtold Digiday.
But with a mere $13 million in revenue last year, Yahoo is pushing forward—and advertisers are ready. The new team headed up by Marissa Mayer and Tumblr founder David Karp has so far signed on such big names as Viacom, Ford, Universal Pictures, Capital One, AT&T, Purina and Denny's to try out the new in-stream ads.
Last year, Tumblr offered advertisers an option to buy the Radar section on its dashboard, which, for four advertisers a day, garnered 6 million Radar impressions. “The engagement rates on the Tumblr Radar and Sponsored Mobile Posts have been spectacular, and we have taken this same carefully architected approach to this new web in-dash opportunity,” Lee Brown, global head of sales at Tumblr told MediaPost.
As for managing Tumblr's unique mix of users and potential advertisers, Mayer told investors on a call that the diversity of Tumblr's content was "exciting" because it allowed Tumblr, and by extension Yahoo "to reach a far wider audience." After the deal was finalized, Mayer made sure toaddress the concerns of advertisers who were worried about their ads popping up on Tumblr's many blogs that contain explicit content.
As for Karp, who is destined to become the tech world's latest young billionaire, the deal with Yahoo provided him and his brand a shortcut through "all the very hard things that we are about to be going through," he told Bloomberg in a recent interview. Karp said he didn't intend on selling Tumblr this year, but when Mayer showed up in New York, "she walked me down a story of how we can do even more together."
And that's the way the cookie crumbles.
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