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April 25, 2005

Google Tests Non-Search-Related Ads

Courtesy of TechWeb News

Search giant Google Inc. on Monday branched out from its traditional model for selling advertisements, and started offering non-search-related ads for partner websites outside of Google's own network.

The ads would not have to be related to the content of the publishing site, nor would it have to be text-based, which is the traditional format used by Google when displaying ads related to search results. The ads could contain graphics and some simple animation.

Google launched a test of the new offering Monday with a select group of advertisers, a spokesman said. The service is expected to be generally available in the "coming weeks."

Google does not plan to sell non-search-related ads for its own sites.

Experts have said that Google, which became a public company last summer, would eventually have to branch out from search-related advertising, which is a far smaller market online than so-called brand advertising. The latter relates to advertising meant to build brand awareness, and not necessarily to lure consumers to a website to buy a product, for example.

U.S. advertisers spent more than $140 billion last year, according to researcher Media Intelligence. Of that amount, $8.4 billion found its way online, and $2.6 billion went for search-related advertising, according to JupiterResearch, a division of Jupitermedia Corp.

In the latest offering, advertisers would bid to display an ad on a site for which Google sells advertising. The bid would be based on the amount the advertiser is willing to pay on a cost-per-thousand impressions, or unique viewers. Google has traditionally charged advertisers based on a cost-per-click.

The ads could contain simple animation, which could not be too flashy or displayed as a continuous loop. The idea is to limit the distraction to site visitors, the spokesman said. Google would review advertisements before they are launched.

Advertisers could choose one site for their ads, or select a group of sites within a particular category.

Competition for online advertising is heating up between Google and rivals Yahoo Inc. and Microsoft Corp.'s MSN.

Yahoo currently sells both search-related ads and branding ads, and offers a far wider variety of content on its portal than Google. Microsoft in March launched itself in the keyword-advertising market with the unveiling of an online-advertising platform called AdCenter.

AdCenter would eventually cover all forms of advertising offered on MSN, including branded displays, paid search, e-mail marketing and other services. The first AdCenter service, keyword advertising, is expected to be tested in Singapore and France in late summer. General availability hasn't been announced.

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