• by Aaron Goldman , Op-Ed Contributor, June 16, 2010

In my forthcoming book, "Everything I Know about Marketing I Learned from Google," I cover the "Googley" lesson, "Test Everything," in chapter 8.   

From the selection of its now-ubiquitous logo to the shading of the blue in its toolbar -- which went through 41 gradations, mind you -- Google is fanatic about testing every possible combination of variables when releasing and improving its various products and assets.

SEM professionals know all too well the importance of testing and iterating. Every element of a PPC and SEO program must be continually refined and optimized. Keywords, copy, landing pages, oh my!  

For its part, Google has made it easier -- emphasis on "er" -- for SEM'ers to effectively test everything. Products like Google Analytics and Google Website Optimizer feature tools for marketers to conduct and analyze tests.

As we all know, though, Google, as a business, has aspirations well beyond SEM. In fact, the lesson from chapter 20 of my book is, "Don't rely on SEM alone." Accordingly, Google has fought (and bought) its way into other marketing and media channels such as TV, radio, and print. However, two of those ventures failed and, while .333 might be a good batting average for Major League Baseball, it doesn't keep shareholders happy. That said, if we consider online display media, the average gets bumped to .500  -- and that's not too shabby.

Indeed, in the display world, Google has fared pretty well of late. YouTube will turn  a profit this year. And the Google Content Network enjoys 80% reach globally, becoming a staple on most every media plan that includes online ad networks.

Google's success in display can be largely attributed to incorporating key features of SEM. In my last column, I shared four of those attributes by way of speculating about what ads will look like on Google TV. When it comes to the online display world, the three most crucial SEM-like variables are:

1.     Precision targeting.  In SEM, marketers can target specific individuals based on their intent as overtly expressed through keywords. In display, marketers can now target specific audience profiles based on intent inferred from data collected through computer IP addresses. There are a number of third-party data aggregators such as Axciom, eXelate, and BlueKai, that track online browsing and purchase behavior to build advanced audience profiles. 

2.     Mass customization. This refers to the ability to show a different ad to each person based on what they're looking for. In SEM, this is accomplished by customizing copy at the campaign, ad group or even keyword level, often using dynamic keyword insertion. In display, this is done via dynamic creative testing tools like Tumri, Dotomi, and Google's recently acquired Teracent.

3.     Dynamic, performance-based pricing. In SEM, marketers can bid in a real-time auction for individual keywords. In display, marketers can bid in real-time auctions for individual ad placements (tied to specific audience profiles) via ad exchanges like Yahoo's Right Media, Microsoft's AdECN, and Google's DoubleClick Ad Exchange.

Managing all these variables requires innovative technology. In the SEM world, this led to the rise of bid management and, now, campaign management tools like Google's DART Search, Microsoft's Atlas Search, Kenshoo, Marin Software, Search Ignite, Clickable, Efficient Frontier, etc.

In the display word, this led to the development of demand-side platforms (DSPs) like Turn, X+1, DataXu, MediaMath, Appnexus, and Google's latest acquisition, Invite Media.

DSPs allow marketers and agencies to perform a number of critical tasks in managing display media, including:

1.     Direct access to ad exchange inventory

2.     Centralization of data across each of the afore-mentioned tools and providers

3.     Custom algorithms to determine the proper bid price for each available ad impression based on the marketer's goals

4.     Detailed reporting down to the placement level to see what's working and apply those insights to other channels

By purchasing Invite Media, Google is providing its advertisers and agency partners with yet another tool to leverage key aspects of SEM beyond the SEM channel.  Or, as fellow Search Insider Roger Barnette put it in his column covering the Google/Invite Media deal, "This acquisition will eventually have more impact on search marketers than any single event of the past several years."

Indeed, this transaction, and the rising tides of DSPs in general, should serve to elevate the roles of SEM pros within their organizations. After all, no one is better equipped to manage a DSP than someone accustomed to managing SEM bid/campaign management tools.

Along the same lines, look for SEM agencies to take the lead in managing more online display media. Assuming Google can effectively integrate Invite Media into the DoubleClick for Advertisers (DFA) suite -- and it appears to have every intention of doing so -- SEM'ers stand positioned well to be the ones pushing the buttons.

Overall, Google's purchase of Invite Media should help boost display ad spending across the board. If it can provide the tools to make display inventory as efficient and effective as search, then the Big G should have success inviting the majority of its millions of SEM advertisers to buy display media as well.

So, to all the SEM'ers out there: If DSP is not part of your daily acronym soup, you may be SOL. To make display media your BFF, RSVP as soon as you get your invite.