Google + DoubleClick + Clear Channel = Advertising OS
At first blush, Google's acquisition of DoubleClick seems to be the perfect match. Each company's client base and products (see chart below) seem mutually exclusive, and together seem to control the whole online advertising pie. What warrants the nose-bleed price of the acquisition? Many reports suggest the deal's motivation as defensive - Google gets the display ad leader that Microsoft wanted and Double Click is a bonafide competitor to Yahoo's new search advertising system Panama. To further justify the high price, Google will need to pull DoubleClick's Web 1.0 ad delivery model into the more efficient ad auctioning model characteristic of today's Google. Google's ad systems' ease of use created mass product acceptance, and it could do the same for all facets of ad delivery... call it Google's Ad OS (thx to GigaOM )
| Double Click | Google | |
| Client base | Fat Head clients - Ad agencies, top 1,000 web publishers, mass media | Long Tail clients - do-it-yourself Adwords/Adsense clients |
| Advertising metaphor | Television - mass marketing works best for generic products like movies, cars and household goods | Local cable microprogramming - targeted marketing works best for "long tail" clients |
| Real estate client | National real estate brokerage | Real estate agent |
| Ad type | Rich media, banner ads | Text ads |
| Ad delivery | Simply put, banner ads can be served to multiple websites | DoubleClick is one feature to building an Online Advertising OS |
| The challenges | ||
| Business philosophy | Web 1.0 pioneer already representative of the established order for online advertising | Web 1.5 - consumer
centric ad placement model threatens to disintermediate ad placement
professionals (i.e. ad agencies) who are DoubleClick's clients |
| Developing new business models | Google will pull DoubleClick much quicker into its new Advertising Exchange auction model to complement Google's auction based Adwords | With the online ad market locked up, Google will aspire to automate ad placements in the mass media markets. They announced today they would be placing radio ads for Clear Channel. |
| Business integration | Will DoubleClick's client base (Yahoo is one) be spooked by Google's monopolistic hold on online advertising ? | Can Google sell its consumer-centric ad server model to its new DoubleClick clients? Ad auctioning is revolutionary and efficient, but it can disintermediate. |
Technorati Tags: Google, DoubleClick, ad server, Microsoft, yahoo, panama, banner ad, adwords, adsense
That means more opportunities for us and more business "fun". I have become dependent on Google more than I want and now I am working to turn this dependence into a prosper relationship.
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