A Google Scenario

The media industry has been abuzz recently over Google's foray beyond the Web and into the brokering of print ads. The size of the trial is miniscule, as far as anyone on the outside can tell, but the possibility of what's to come is where things get really interesting.

Search industry watcher Danny Sullivan wrote on his blog last week, "Not only doesn't the move surprise me, but I personally expect we'll see more of it." I happen to agree.

Okay, suppose we will see a lot more Google in traditional media. Google makes nearly all its money from advertising, and as a public company the pressure to grow revenues is intense, right? Imagine for a moment that Google cracks the code and extends its yield-managed auction not only to broker print, but also radio, television, out-of-home, and new media formats like podcasting and handheld devices. Aren't Google and other search leaders already racing to effectively search and index many of these other media?

Next, assume that Google was able to successfully extend the utility of its model from direct response and classifieds to large-scale brand and image advertising across all media. And imagine that across all these advertising strategies, Google was able to provide unprecedented measures of performance for major and micro advertisers alike. Finally, picture a Google that even achieved critical mass -- attaining both significant buy-in from media-property owners, and a major share of total dollars that transact for media sponsorship.



Such a picture would have serious ramifications for our evolving media and marketing ecosystem, which already is in flux as digitization, personalization, and fragmentation take hold. This scenario -- albeit entirely hypothetical and excessive -- implies a media landscape very different from the one we have today.

A Google Cross-Media Infrastructure First, such a Google scenario could cause a major shift in allocation and pricing across all media. Increasing use of the auction-based performance model would help rid the current system of biases and inefficiencies that exist today. The concerted efforts by individual publishers (or other media property owners), savvy salesman, and channel-specific lobbying groups to tout their self-interests will never go away, but the playing field would become far more reflective of reality and ROI.

Making more media formats and titles comparative, accessible, and performance-based would only counter unevenly distributed spend and, in many cases, inflated demand. This trend would accelerate tremendously the ongoing erosion of mass media and the budget shares they currently command.

Paid search and contextual advertising would further accelerate the introduction of many more micro-advertisers across all media. Their dollars and demand would create an entirely new dimension. One notable difference already observable with Google's print experiment is the entrance of smaller advertiser collectives to more premium pages in the magazine -- once the exclusive domain of larger advertisers with much bigger budgets. These collectives could start to tilt the overall demand equation.

Assuming buy-in from publishers and their peers in other media formats, Google could leverage its contextual capabilities to aid in media planning and selling. JupiterResearch analyst Gary Stein poised the question on his blog last week: "Would a publisher be willing to let Google crawl their pre-published content, so that it could place better ads there? Magazines already inform advertisers about upcoming features. Why not automate this whole process, especially if it results in higher ad revenues?"

Given the importance of human relationships and the fact that there is somewhat of an art to all we do, I doubt selling could ever be entirely automated. But introducing this type of automation to more effectively match buyers and sellers -- and realize premiums for the media assets that truly matter most to advertisers -- would seem a likely progression. And as all media become more digitized and searchable, this concept could extend to radio, television, and most other channels.

Finally, if Google actually became a powerful bridge to all media, it would encroach on the space of the big media-buying agencies, if not alter their world. Google could use its massive databases of audience behavior to directly help advertisers optimize buys within its vast multi-channel network. It could institute and democratize all kinds of media and marketing models to suit advertisers of all different sizes and industries. In effect, it could bring a form of user-friendly econometrics to the masses.

On the flip side, media agencies could become more important for the larger and more sophisticated advertisers; they could help navigate and spend more wisely across a more diverse, unpredictable landscape. Google and media agencies would be partners in some cases, and competitors in others. If anything, Google's role of middleman would be more complex.

Back To Reality, Please! Thankfully, this hypothetical Google scenario has little chance of playing out exactly so -- and, admittedly, Google only claims to be "experimenting." While some publishers will embrace this Google experiment, others -- like many already in the newspaper and magazine industry -- will strongly object to any loss of control over their pricing models and relationships with advertisers.

What's more, cracking radio or television will be challenging. Google has a long way before significantly disrupting the overall media demand equation. Finally, while Google is considered the search king, it also has some very savvy competitors at its heels.

But at the end off the day, this truly is an interesting experiment. Media and marketing professionals should consider at least two critical points: First, Google's expansion beyond the Web justifies the viability and importance of traditional media. Second, Google's move suggests that the future of media is one that is vastly more interconnected, database- and search-driven. Consequently, this move should be yet another wake-up call to advertisers and their agencies to develop strategies and infrastructure that are more integrated. Search and its related functions eventually will be entirely intertwined in the overall media mix.

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