Yahoo's new Panama search advertising ranking system has been both appreciated and criticized by advertisers. Appreciated, because the new system is streamlined, easy to use and offers much more control over campaign management. Criticized, because the previously relatively simple system of the more you bid the higher the placement has been replaced with a more complex formula which includes factors like ad "quality," brand recognition and other things that have reduced the transparency of the system for many advertisers.
Although bids are and will remain a factor in the new ad ranking algorithm, Yahoo is also following Google and Microsoft in analyzing other factors to determine placement of ads in sponsored results. For example, the algorithm analyzes both ad copy and landing page copy, in the same way as web pages are analyzed to determine their rankings in organic search results.
At this point, more emphasis is being placed on ad copy than landing page copy, but landing page quality will become more important in the algorithm over time. Yahoo is also encouraging advertisers to use the "excluded keyword" feature to more precisely target ads.
As a searcher, this means that using precise, specific queries will give you much better sponsor results than in the past. Use words with narrow meanings in your queries rather than general search terms for better search results.
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