eBay is preparing to announce a keyword-based content advertising system for sellers on its popular online auction website. The eBay AdContext service will help boost auction activity by displaying content-based ads on other websites, following in the footsteps of online advertising giants like Google and Yahoo. 
Speaking at a software developers’ conference last Saturday, Mr. Michael van Swaaij, Chief Strategy Officer of eBay, introduced the plan to “arm” sellers on eBay with a contextual advertising service that will appear on other websites.
The eBay system differs from the pay-per-click advertising systems currently operated by Google and competitors Yahoo and Microsoft in that the links will only point to eBay auction listings, rather than functioning as a broad online advertising network directing traffic to multiple websites.
This largest e-commerce website in the world has announced plans to provide hundreds of thousands of eBay bidders with simple code snippets that they can use to embed links to eBay auction listings on other websites.
According to Mr. Swaaij, the testing phase for the advertising program named eBay AdContext is scheduled to be introduced next week. The products featured in each specific ad will be determined by keywords present in the content of the respective website, a form of contextual advertising.
This advertising system will scan the content of a website to search for keywords and return a list of links related to items currently being auctioned on eBay. For instance, a sports website might automatically receive ads linking to sports equipment or memorable sporting events up for auction on eBay.
As the list of auction items on eBay changes, the ads placed on other websites will also automatically update to reflect new products or services being offered on eBay. These partner websites will receive a commission ranging from 35% to 60% of the revenue eBay generates from auction customers, depending on the volume.
Such advertising formats are expected to become a new method for website owners, both large and small, to monetize their sites, especially for personal blogs that often rely on small keyword ads from Google to cover operational costs.
eBay views the AdContext system as a complement rather than a competitor to online advertising services from Yahoo and Google. Many websites may offer both eBay ads and other advertising services.
M.H
