After colonizing cyberspace, Google is going into the newspaper business…
“Unlike Google’s venture into magazine publication ad auctions, the newspaper version called Google Print Ads has found a following in the United States. Google will try this next in Britain…”
Chicago — Search engine leader Google is in talks with several newspaper publishers to sell space in their pages to online clients through “Google Print Ads,” reports The Sunday Times. Google Print Ads started in the US since mid summer and already supplies more than 600 titles.
Google Inc. shares fell more than $11 Monday as investors sassed out a report that the Internet giant is exploring a method of selling European newspapers’ advertising space online.
“This expansion will worry bosses of rival media companies, including ITV chairman Michael Grade, who has already called for greater regulation on the fast-growing Google,” the Times article by James Ashton said.
“Google’s AdWords clients across the big pond will have the chance to bid on placement in newspapers…”
The Times of London reported that the service, called Google Print Ads is an extension of Google AdWords, which operates as an auction system that lets companies submit bids for the advertising space that appears along specific online word searches.
"Customers reportedly would be able to choose a newspaper online through Google and place a bid for advertising space. The bids are to be on a day-to-day and page-by-page basis.”
Bidders would offer the price they are willing to pay for the ads, and newspaper publishers would then decide whether to accept, counter, or reject the offer. Google stands to take a piece of the advertising sales from every deal between advertisers and publishers.
Google’s U.K. advertising revenues rose roughly 40% to about 1.25 billion pounds or $2.48 billion this year, the Times reported. It said that was more than the revenues of newspaper publisher Trinity Mirror’s income, including circulation income. “Google has already outpaced Channel 4 and beaten ITV1 in the third quarter” in advertising revenues, the Times said.
There is so much advertising these days that most people tune it out and ignore it. Most businesses can show a direct correlation between dollar spent on advertising vs. the ROI for those dollars spent in either additional sales or additional customers.
Google takes a slice of the advertising revenue from every deal struck. It even offers to design the ad if the advertiser does not have the capability to do it alone. “We believe that online and offline are part of the same melting pot,” Google said. “It is not an ‘either or’.”
Google’s effect on the publishing industry, and in search and advertising, might have been summarized already by Jeff Jarvis. He blogged several fun facts about Google’s size and impact, titling the summary: “Google is God.”
Google has single-handedly changed the way marketers, advertisers and PR professionals spend their money. Our eyeballs in ‘definite’ places are worth so much more due to place- and time-shifting. The internet will be the last place where metrics are readily available and accurate.
Judging from consumer habits, brand awareness, loyalty is cultivated and fostered by advertising. People do not make purchasing decisions based on commercials, but very often purchases from impulse or even lack of knowledge of competitors will turn the consumers back to the company name they remember.
That would not sit well with British publishers, and did not impress Donna Bogatin, who ripped Jarvis’ assessment, as well as calling Google a “ruthless” corporation with an “unholy mission.”
Print Ads, which started in the US mid-year, already supplies 600 titles, ranging from the 3000-sales-a-day Shelbyville Daily Union in Illinois to the Charlotte Observer in North Carolina, which sells 215,000.
A British newspaper boss said: “It is an interesting development with the prospect of bringing new advertisers into our newspapers. If advertisers find it to be an effective channel, then there is the prospect to form direct relationships on a more normal basis.”
Britain, with high broadband penetration, is one of only four nations where Internet advertising share is more than 15% of total advertising spend, the Times report noted.
It quoted Phil Stokes, leader of the entertainment and media practice at Price Waterhouse Coopers, as saying: “We can foresee newspaper groups participating in online exchanges for print advertising in the near future, but consider it unlikely that the larger players will automatically gravitate towards a large specialist third-party online provider without looking for other solutions first.”
But when will this arrive on Australian shores? Last month SmartCompany asked the new general manager of Google Australia, Karim Temsamani, when Print Ads might come to Australia? His reply: “It is not something that we are looking at from an Australian perspective at this stage. The structure of the Australian market is very different and certainly our focus from a management-of-the-business perspective is different in Australia at this stage.”
Despite the potential for opening print ads to smaller businesses that might fill space a paper may otherwise fill with less profitable placements, the publishing industry likely views Google with caution bordering on sheer terror. In the UK, the Times Online said Google rates higher in ad revenue than some media outlets already.