Reply.com has launched an interesting pay-per-click (PPC) advertising marketplace called the Click Marketplace. It aims to give small businesses without huge ad budgets access to highly targeted advertising.

Here’s how it works. A user clicks on an ad and is immediately taken to a page that prompts them for basic information related to the category of the ad. For example, a real estate ad might prompt users to enter their zip code.

Based on the user’s input, the Reply system will then direct the user to the website of one of its pool of advertisers in the Click Marketplace. Which advertiser’s website the user will see will depend on the outcome of a real-time auction between the various advertisers.

If my interpretation of Reply.com’s click funnel is correct, Reply.com estimates that out of all the raw clicks on your ad, 30 to 50 percent will be filtered out at the ‘qualification’ stage i.e. when users are prompted for more information. This means that, if you win the real-time auction, about 50 to 70 percent of the original prospects - who, in turn, are more qualified – will arrive on your website.

Source: Reply.com Launches Secondary Click Marketplace: Get Geo Targeted Ads On The Cheap 26 Commentsby Jason Kincaid on December 3, 2008

Yahoo has released a new zip code targeting feature for Panama search advertisers that allows them to direct ads to searchers based on their zip codes.

The service comes with an interactive mapping interface that allows advertisers to specify cities and zip codes and is more precise that the geo-targeting feature in Google Adwords which is only city-specific.

Yahoo’s service - like Google’s geo-targeting feature in Google Adwords - is based on identifying a searcher’s IP address, as well as some other factors. As such, it’s not fool-proof and Yahoo notes that the accuracy of its geo-targeting is not guaranteed.

Currently, the service supports cities and zip codes in approximately 3,500 municipalities in the U.S and Canada.

Source: Zachary Rodgers, “Yahoo Adds Granularity to Local Search Ads”, The ClickZ Network, October 20, 2008