As Google pulls out of the newspaper and radio ad business, it seems loyal to its TV efforts, but several shortcomings are holding it back, according to a BusinessWeek story. Excerpts:
“In the past two months, Google has abandoned its efforts to sell newspaper and radio advertising. Will it pull the plug on its initiative to sell TV ads, too?
Given the coming convergence of TV and the Internet as well as advertisers’ hunger for Web-style measurements for their TV commercials, chances are good that Google will stay the course. But it faces a tough slog. A range of companies are also developing technologies that do a better job of allowing advertisers to target TV viewers. Then there is traditional media’s deep-rooted suspicion of Google.
When Google announced its television venture—dubbed Google TV—nearly two years ago, it sounded promising. The search giant is trying to replicate its Web model for TV, offering a self-service, auction-based system for advertisers. Advertisers can choose shows that best fit what they are selling. For example, a travel agency can visit a special Web site, type in, say, "cruises," and Google finds programs through guide information that might mention cruises, like an episode of King of Queens in which the characters Doug and Carrie go on a cruise. Advertisers bid on the ads available for that program, decide what they are willing to pay, and upload their commercial, which is delivered directly to the TV network.
Being able to target more effectively and buy on the spot is what attracted Chinese PC maker Lenovo, one of the first big advertisers to buy commercials through Google. "We needed to be super-efficient," says Deepak Advani, Lenovo’s chief global marketing officer. "With Google, we were not forced to buy a package of ads at the same time. We could buy one ad at a time, and bid on the spot we wanted, and see it air two days later."
Lenovo, however, is one of only a handful of big advertisers to use Google TV; others include Jenny Craig, Priceline, Buy.com, and some Johnson & Johnson brands like Lifescan and Centocor. Because the Big Four broadcast networks have shut Google out, the company has partnerships with relative small fry, including Dish Network, Hallmark Channel, Bloomberg TV, and NBCU cable channels such as CNBC, Sleuth, and Thriller. These outlets don’t provide the number of viewers and reach that national advertisers require. Dish Network, for instance, is in only 13 million of America’s 112 million TV households.
Some advertisers also say the slots Google is trying to sell are often at the most undesirable times of day—the middle of the night, say, when self-help guru Tony Robbins rules the airwaves. "The challenge for [Google] is scale," says Russ Klein, chief marketing officer at Burger King, which buys Web search ads through Google but zero TV time. "We don’t see anything seismic here right now."
Another shortcoming of Google’s automated system, say marketers, is that its technology, while impressive, usurps relationships that still mean a lot among Madison Avenue, advertisers, and TV companies. "There are important relationships and discussions that go on about how to develop programming and how to present your message on TV," says Klein.
Google will play a role in the future of TV advertising, says Curt Hecht, a top executive for the ad conglomerate Publicis, but it will not dominate the way it does on the Web. For now, says Hecht, ‘Google TV is a healthy experiment’.”