lundi 2 juin 2008

The Googlization of the Advertising Market

Google is the leading worldwide sales rep in number of clients and in turnover. The first one to be deliberately worldwide (cf. the language and transliteration tools, the number of languages covered, and so on). Any major resistance comes from a Chinese search engine (Baidu, 百度). Nobody can avoid Google anymore.

Google’s most important impact is indirect. Adsense and Adwords are training advertisers and sales forces to acquire new professional habits while buying keywords, optimizing websites for search (SEO), analyzing traffic, landing pages, quality scores, PageRank … Moreover, Google ergonomics, user interfaces, vocabulary, etc. permeate our culture. Google has become a “habit-forming force”, building a habitus (“principle that regulates the acts”), which in turn paves the way to generating mindsets and actions that conform to Google’s grammar (sort of affordances or "action possibilities"). Planners and buyers employ the same modus operandi when using the numerous Google tools (Maps, Apps, Docs, YouTube, Search, Gmail, android, etc.).

We now all speak “google” more or less fluently.

Then comes the Google syllogism:

  • Internet is the model for all digital media
  • All media are becoming digital (switchover)

Ergo …

What works for the net will sooner or later work for all media.

The digital advertising market is based on two main principles: automatization of the advertising chain (creation, planning, buying, adserving, analyzing) and self-service. All of this is nothing but the reduction of transaction costs (cf. R.H. Coase about the emergence of the very small firm, and about barter). It translates into an ad market place (auction-based, no more rate card) and opens the advertising market to a wide number of new advertisers: small, hyper-local, niche companies and SMEs (the “long tail”). Almost no barrier at the entry: pros and amateurs (Pro-Ams) can come to the market.

So it should be no surprise that Google tests the water by joining the American ad market for print, radio and TV. Europe is probably next. And the Mobile Internet. Same tools, same methods, same reasoning. A new generation of planners and buyers, Internet geeks, Web 2.0 aces: all Google natives accomplish the mutation from the GRP culture to Internet culture: it is less about reach and frequency, more about interaction, call to action, behavioral targeting …

Should we worry? Should we start a conservative crusade against Google? We could, but it would be hopeless since it is not just about Google; it is about the Internet and we cannot fight the Internet. Instead, let's take advantage of what Google has done and reinvent the advertising profession.


About these concepts see Erwin Panofsky, Gothic Architecture and Scholasticism, 1951 and the Postface of the French translation by Pierre Bourdieu, 1967; see also Noam Chomsky, Aspects of the theory of syntax, 1965 and James J. Gibson, The Theory of Affordances, 1977.

(Some of these ideas were presented at the EGTA conference in Dublin for European Television and Radio Sales Houses, May 30, 2008).

3 commentaires:

Romain Desmonts a dit…

Google looks very much like the Microsoft of the mid-90s. It is growing fast, it is taking over an overwhelming market share when it comes to advertising on the Internet and it has become close to being the alpha and omega of search engines, almost becoming THE search engine for Western countries.

Like Microsoft, they should and most likely will become, and for a long time, the advertising giant on the Web. A theory says that when it comes to new technologies and digital markets, hyper-competition prevails and leads to the birth of giants occupying a specific segment of the market: this is Microsoft for operating systems, Google for advertising and search engines.

Therefore, one should not be surprised at Google's domination even though some potential competitors try to react. However, we should keep one thing in mind: on a long term basis, Internet is not competition-friendly. Its userbase prefers monopolies that define and make standards. Thus, people claiming that we should not repeat the mistake we have done with Microsoft (as in let the company establish an unyielding monopoly) tend to forget that we have not reacted much back then, and we are not that unhappy looking at what it has become now. It is very likely that people will not act much again.

Instead of going against a trend against which there is nothing to be done, trying to benefit from it is and remains the best option. Google has changed the way we use the web, and made it better. Only Yahoo or whatever minor search engine die hard fan would tell you otherwise.

The only thing that could be a true object of worries is the data Google has acquired over the last few years: search requests, GoogleMail user information etc. A couple of years ago, it was even made public that Google had terabytes of information stored on hard drives. Google finally gave in to the pression of the public and discarded this information but one never knows what may happen again. This type of information is worth solid gold. Google may be tempted to build such databases once again.

Regarding TV, radio and print, we should expect great improvements in the way advertising is done. Those who have failed to innovate in these sectors may be afraid of what is due next. But that is what competition is all about. The best gets the lion's share. And without any reaction, this is what Google should get.

Charles-Edouard Delettrez a dit…

Internet, les mots-clés et et autres liens sponsorisés ne sont plus les seules sources de revenus de Google en termes de publicité. Google est en perpetuelle quête d'expansion, cherchant de nouveaux marchés, de nouveaux supports pour assurer son emprise sur le marché publicitaire mondial.

Ainsi, pour étendre son développement et ne plus compter que sur Adwords et Adsense, Google envisage de nouvelles formes de publicités sur divers supports, allant de la télévision à la radio.

Nous pouvons maintenant détailler la stratégie de Google autour de deux points essentiels:

- Toute sa croissance repose sur une avancée technologique dans le monde publicitaire: une relation efficace entre les annonceurs et les supports via une plate-forme automoatisée qui permet d'assurer
les ventes, la livraison et le suivi des campagnes.

- D'autre part, sa stratégie de croissance repose sur une croissance externe avec le rachat de start-up innovantes ayant développer des outils fiables et surtout très utiles, à l'image de dMarc Broadcasting pour les solutions radio ou encore de DoubleClic, pour les solutions marketing.

Google s'est donc recentré ces dernières années sur un coeur de métier spécifique: la publicité comme moyen de rentabiliser chaque média, et Google est ainsi devenu un acteur majeur de la publicité mondiale.

L'exemple le plus probant est l'apparition d'Android, le googlephone, dont les revenus proviendront principalement de la publicité,via la présence de liens sponsorisés sur les sites mobiles d'Android.

François MARIET a dit…

Which theory are you talking about (2d §) ? FM