Almost any type of targeting and personalization has a degree of creepiness to it from the consumer perspective. iTunes recommending music based on songs purchased through iTunes was acceptable; recommending music based on one's library stored on the desktop generated a mini-uproar. MSN targeting paid search ads based on demographics of registered users is fine, but any search engine targeting based on user behavior on other sites will make some users uncomfortable. Yahoo Mail banner ads are a fair price to pay for the free account, but Gmail's targeting text ads based on message content was panned during initial trials.
Now, Google Talk and Gmail are becoming one and the same. Cool or creepy? Both. But the biggest issue for marketers is a lack of control over where their ads appear. Saving IM conversations is nothing particularly new. Google Desktop has offered IM archiving, and my friend Devin Cohen reminded me that AOL-owned ICQ has offered IM archiving for years. Storing the conversations within e-mail is the twist, one that makes the conversations much more accessible and front of mind, available within a "chats" folder on the left-hand side of Gmail. Additionally, the conversations come up in mail searches. Contextual ads run alongside the saved chat transcripts.
Presumably contextual inventory won't rapidly increase now that Gmail is archiving chats. Yet if Google expands the program to live chats as opposed to archived versions, inventory could skyrocket. A case study from a rich media company sheds some light. In September 2005, Unicast announced that it served over 2 billion ad impressions on AOL Instant Messenger. Unicast wasn't even in an exclusive relationship (though it did serve some proprietary formats). Given that AIM has been free for years--while AOL opened up its portal to the public relatively recently--it's possible that ad revenues were so strong that AIM was the tail wagging the AOL dog.
Rich media ads ran atop the IM client itself, not alongside conversations. Ads targeted to the IM conversations can quickly cross over into the creepy. Right now, the ads along Google Talk conversations stored in Gmail don't actually serve much of a purpose. They'll rarely be seen, thus not providing a material increase in ad inventory. The most significant impact from the Google Talk-Gmail pairing is that it is now easier for Gmail users to access the IM client. Expanding the user base comes before expanding the inventory.
This can be a building block for something bigger. If there's not much of a backlash to ads targeted to archived chats, then building a text ad into Google Talk isn't a stretch. It's really just a matter of tweaking the minimalist Google Talk interface. But there'd have to be more of a hook for consumers to win them over. Google Talk evolving into a real competitor to Skype, offering consumers free international phone calls, is one juicy piece of bait Google could realistically dangle.
Meanwhile, the missing piece for marketers is more control. Google currently allows AdWords advertisers to opt out of running ads on its contextual (or Content) network, which includes Gmail. However, contextual advertising is an all-or-nothing proposition. While some media buyers I surveyed don't think it's a big deal right now whether ads appear alongside Google Talk conversations, the possibility of consumer backlash to this additional level of targeting could reflect poorly on the advertisers whose ads are displayed.
I don't actually expect advertisers to flinch so quickly. Yet, much as I've tried to avoid writing a Valentine's Day-themed column, this is a day to think about how relationships work. One thing successful and unsuccessful relationships have in common is that they hinge on the little things. A heartfelt handwritten note can be the deciding factor in a major account, and a single slight can make one realize an entire partnership has been built on shaky ground. Now, returning to the case at hand, Google has a history of erring on the side of offering less control to its advertisers; it needs to set a new precedent to foster these long-term relationships.
Integrated Gmail and Google Talk have their cool factors, and it would also be cool to expand contextual ad inventory with chat-targeted ads. Yet cool's counterpart must also be considered. What would be worse: Google creeping out its consumers or its advertisers?