Google wants to simplify the process of buying and selling display advertising across the Web in 2010, and has set up a strategy to achieve the goal. In a Webcast Tuesday, Googlers laid out the plan to simplify the buying and selling process, increase performance, and maintain an open platform to serve ads across PCs and mobile phones.
Display advertising is on track to become one of Google's next big businesses, according to Susan Wojcicki, vice president of product management, who defines the ads as videos, images, banners, Flash and other interactive ads.
Wojcicki explained during a Webcast Tuesday how the amount of time people spend on the Web is disproportionate to the percentage spent for online media. People spend about 12 hours per week online, but online advertising only makes up about 13.6% of advertising dollars spent in the United States.
The biggest problem has been that while the online audience continues to grow, it's fragmented across hundreds -- if not thousands -- of sites, Wojcicki says. Google believes this gap exists because of the complications involved in buying and selling display ads.
Simplifying the process will attract more marketers to online display advertising -- a medium that has become easily measurable in clicks, impressions and conversions. Google believes running display ads on the Google content network of more than one million Web sites helps marketers optimize campaigns and measure results.
J.P. Morgan analyst Imran Khan points in a research note to the fact that the Google Content Network reaches 85% of global users and can host CPM or CPC ads.
Opening the display marketplace to more companies means Google has the ability to support a variety of companies that want to advertise. Today, Google products range from DoubleClick Ad Exchange, which creates an open marketplace for display ad space, to Display Ad Builder, a self-serve tool within AdWords for small advertisers.
Google also introduced real-time bidding for display ads. The real-time feature supported by the exchange results in the most effective placement across Google's content network.
Then there are two ad-serving products: DART for Publishers (DFP), a tool to manage the complex products of how ads appear on Web sites, and DART for Advertisers (DFA), which helps plan, schedule and optimize display ad campaigns.
In November, Google announced the acquisition of Teracent, a display advertising startup that developed machine learning algorithms designed to deliver optimized Web ads in real-time. Ari Paparo, director of product management at Google, says the company plans to incorporate Teracent's technology into DoubleClick products.
Google director of product management Brad Bender describes some of the technology investments made during the past year that should help Google see success in display advertising in 2010. Refusing to call it behavioral targeting, he says the company introduced "interest-based adverting" in March.
The interest-based tool, in beta, lets marketers match ads with people based on their interests and activity online, and serve up ads across Google's content network. More than 600 interest-based categories are based on the sites the computer's browser visits. Ads preference manager lets people opt-out or opt-in.
Google also has begun making changes to ad formats served up on search pages, such as ads with embedded maps, or entertainment companies with videos in line with search results.
Finally, Google sees mobile display advertising as an "exciting" opportunity as more consumers adopt smartphones. Some of the features that Google will focus on in 2010 include location-based targeting, and click-to-call. The AdMob acquisition focused on display ads that will "enhance" efforts.