eBay all set to enter Web advertising market

The major auction service on the Web-eBay is all set to unveil keyword advertising - where internet users will be directed to specific auctions linked to words on the web page they are visiting.

eBay Inc., which manages an online auction and shopping website, where people buy and sell goods and services worldwide, is about to enter the web advertising market space with a new context sensitive system for affiliate website publishers.

California, USA based EBay's new system, called AdContext, may prove popular with blog site publishers who would be able to use it as an extra generator of revenue, according to the analysts.

This novel system will work in a similar fashion to Google AdSense, which recognizes keywords on a web page and serves up ads connecting to websites that are relevant to the content. The plan includes, site owners hosting the adverts for the online auctioneer will get a slice of the product sale price.

Revealing the plan at a conference of software developers in Las Vegas, EBay's chief strategy officer, Michael van Swaaij, said, “We want to increase the number of times buyers come to particular sites."

In a fundamental example of a context sensitive system, a web page containing an article about computers is possibly to serve ads from computer manufacturers. The eBay AdContext works in a similar way except that it will only serve up ads on partner sites which link to auctions on eBay.

According to the analysts, EBay is one of the largest advertisers on both Google and Yahoo and the recent plan could reduce its reliance on these sites, however, eBay reportedly insists the new eBay AdContext is not in competition with Google.

Industry analysts still say that it's in the interests of both Google and eBay to be nice to each other because eBay is possibly Google's biggest advertising customer, while eBay obtains a huge proportion of its traffic from Google.