Google had made a preparation to grab Internet Display Advertising from Yahoo, a lucrative market that had long been enjoyed and dominated by Yahoo!. Google’s chief executive, Eric E. Schmidt, has said repeatedly that display advertising offers one of the company’s best prospects for expansion, now that growth in its text ad business has slowed significantly. The new advertising exchange is a cornerstone of Google’s display strategy, and one of the main reasons Google bought the ad company DoubleClick last year for $3.1 billion.
Google executives say the new system, called the DoubleClick Ad Exchange, will greatly simplify the process of buying and selling display advertising, allowing many more publishers and advertisers to benefit from it.
Currently Google finds itself in the unfamiliar role of underdog. As one of the Web’s biggest publishers, and a seller of ads on a network of top sites like eBay and hundreds of newspapers, Yahoo is the king of the display advertising business. In 2007 Yahoo bought Right Media, a pioneering ad exchange whose business has grown steadily since, in part because many of the ads that run on Yahoo are brokered through it.
Still, analysts say Google’s push into the business could shake up the market. DoubleClick has had an ad exchange for some time. But the new system will automatically allow hundreds of thousands of advertisers and publishers who now use Google’s AdWords and AdSense systems to run their ads and ad space through the exchange.
“Marketers are going to be able to effectively reach 100 percent of the Internet audience and do so at a high frequency,” said William Morrison, an analyst with ThinkEquity Partners. “That is very difficult to do on the Internet right now, outside of a handful of major Web sites like Yahoo and a few others.”
Ad exchanges have been hailed as the future of the industry for some time, yet Mr. Morrison said that they only account for between 10 and 15 percent of the display advertising business. He said it was unlikely that the DoubleClick exchange would catch up with Yahoo’s exchange within the next year. But the Google exchange could become dominant over the long term, especially among premium brand marketers and publishers, he added. (source: NYT)
Google executives say the new system, called the DoubleClick Ad Exchange, will greatly simplify the process of buying and selling display advertising, allowing many more publishers and advertisers to benefit from it.
Currently Google finds itself in the unfamiliar role of underdog. As one of the Web’s biggest publishers, and a seller of ads on a network of top sites like eBay and hundreds of newspapers, Yahoo is the king of the display advertising business. In 2007 Yahoo bought Right Media, a pioneering ad exchange whose business has grown steadily since, in part because many of the ads that run on Yahoo are brokered through it.
Still, analysts say Google’s push into the business could shake up the market. DoubleClick has had an ad exchange for some time. But the new system will automatically allow hundreds of thousands of advertisers and publishers who now use Google’s AdWords and AdSense systems to run their ads and ad space through the exchange.
“Marketers are going to be able to effectively reach 100 percent of the Internet audience and do so at a high frequency,” said William Morrison, an analyst with ThinkEquity Partners. “That is very difficult to do on the Internet right now, outside of a handful of major Web sites like Yahoo and a few others.”
Ad exchanges have been hailed as the future of the industry for some time, yet Mr. Morrison said that they only account for between 10 and 15 percent of the display advertising business. He said it was unlikely that the DoubleClick exchange would catch up with Yahoo’s exchange within the next year. But the Google exchange could become dominant over the long term, especially among premium brand marketers and publishers, he added. (source: NYT)
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