From Search Ads to Display…
Google Search was launched on September 15th, 1997, making it over 20 years old.
The project was initially created to compile publicly accessible documents and databases with only written text into one easy to access database to be queried with the use of words.
In 2004, Google went public and began monetizing its pet project as a marketing tool. After the world markets collapsed in 2008, it created a power vacuum for many industries that were considered titans (AIG, Ford, and GM). In essence, it shook the power struggle occurring between old world money (banks, insurance, manufacturers) and the new world (internet and technology based companies).
Before the dust settled, Google seized an opportunity from the chaos and pushed its novel product to companies and individuals world-wide. The premise was for businesses to be able to quantify their marketing efforts. This would in turn allow for better measurement of consumer acquisition and in theory lower costs with increasing efforts wherever there is a positive customer acquisition marketing effort.Between November 2008 and December 2009 as the world recession was occurring, Google quietly doubled its stock, thanks to one cornerstone product and its ability to produce during economic downturns, Search Ads. This growth has yet to be repeated for Google in such a small amount of time. source.
As late as 2016, 55% of people didn’t know which results on Google search were paid ads. source
To this day - search ads are one of the most trusted forms of advertising for consumers and advertisers, due to their simplicity, transparent consumer intent, and incognito serving capabilities. source
Advertisers love them so much that it has become a standard practice for internet news agencies to dedicate entire press rooms for changes occurring to important products. source
The power behind search is immense, if not unstoppable. Google Stock at the time of writing this article was at its highest peak ever witnessed (993.27 , May 26 ,2017) and had increased over 100 points in the span of a month and a half (April – May, 2017).
Pricing, Timing, Relevance & Reach.
The point of all this is that Google search ads, are 20 years old, facing their peak, inflating prices - and increasing competition. This is where display ads come in.Despised by advertisers and consumers for years while being advantageous to Google - allowing them to reach a wider audience for minimal cost.
Display ads give Google the opportunity to curtail inflation without reinventing the wheel while promoting consistent ROI. Online banner ads, mobile phone ads and digital pop-ups all round out the least trustworthy format when it comes to decision making. All three of them at their core are display ads. How can Google turn one of the least trustworthy into one of the most effective?
Pricing
Display ads through the AdWords Display network have been neglected for a long time, primarily because they were too expensive. Google initially couldn’t guarantee that the ad was served to the consumer, turning advertisers into cynical philosophers, “What did I really pay for?” Instead of paying $1.00 for a thousand impressions - advertisers were paying $1,000's for a few irrelevant clicks and millions of fake impressions. source
Timing
You didn't know why the user was on the site in the first place so it was impossible to get the timing right.
Relevance
The relevance in the display ads was missing due to advertisers disconnect when it came to digital consumer consumption. Many advertisers focused on a “price & performance” model, losing focus of consumers and without being able to track display based “performance”; creating a perfect recipe for miscalculated failure.
Reach
The reach of display ads was also limited due to early manipulation of AdSense code which prompted chilling regulations and oversight by Google which in turn prohibited content worthy users joining the program as well as the early warfare waged between different display ad vendors due to the emergence of programmatic purchasing processes. source
Fallout
What is making Google look to over avenues is the inevitable inflation to search cost as well as the drop in return on investment seen across the board by thousands of small businesses. For the last five years - retail revenue has increased 2.45% while advertising has doubled to $72.5 billion. source 1 / source 2
They attempted to stem the tide with purchasing YouTube in 2006 and began to route traffic through it's sub-domain to fluff up quarterly numbers while promoting video format advertisements. source
Slow and quiet focus was turned to old pieces of inventory. By 2010 AdWords unveiled its "new" re-marketing program. source
This new program allowed advertisers to follow consumers with either a text ad or an image ad. The Analytics program was revamped in a follow up patch to better consolidate the power of re-marketing and monetize off the demand of business intelligence.
Lists of people who visited your site or performed a specific action were initially created through the Google Ads interface, however - because Analytics is a platform for mining and understanding user behavior, the lists began to evolve at a rapid rate because of how Analytics is installed on a site and what data it can glean from any given user. Helping advertisers better understand and target any and all of their visitors. source
The move to allow Analytics to control re-marketing lists was something that would increase relevance (what demographic profile does the consumer belong to) as well as timing (you could exclude whoever you wanted to) – further settings on the Google Ads side were expanded to help control the timing and relevance. Frequency capping was introduced so that the consumer does not receive banner blindness. Responsive ad creation was created to form a bridge between text and display while alleviating the need for extensive communication between the designers and the Google Ads/Analytics teams. This would allow for rapid – event oriented marketing that would boost relevance in the eyes of the consumer without increasing the workload for the advertiser.In the health industry alone, there is a differential of 653% on prices between display and search. Generating more active display advertisers would stem the inflating price issues facing search ads. source
Granted, with Search Ads you can see intent behind the consumer within hours; based on the queries typed by the user, location, hour of day and ad copy. But with the expansion of Analytics, you can create the same understanding by having the right employee pulling the important data for your business to create a user profile no matter if they came from search or display. Information such as demographic, gender, age, and ad placement exclusions/inclusions to increase the effectiveness of your display ads while lowering prices.Extending your reach with display ads to rival the inventory served by search ads seems to be a daunting task. To tackle the task of increasing reach of display ads you would have to figure out the following three: flexible format, device-friendly, and easily automated. Each second, Google processes over 40,000 search queries (roughly 3.5 billion searches per day and 1.2 trillion searches per year worldwide). Search ads are so simple, so easy to manipulate visually - that you can do all three things listed above to put it in every nook and cranny that you can find. source
To be able to compete with 1.2 trillion searches per year - you would truly need to immerse the consumer with your brand wherever they go, or on whatever device they use.On October 24th, 2016 AdWords unveiled their latest display format which is a hybrid of text and display to satisfy the recent trend of native advertisement. source
This move for responsive ads is aimed at beginning to solver for the format, device, and automation problems needed to overtake Search. On top of all this - until recently, Display Ads were missing a major factor, control. “Who should decide what format to display and on what device?” and “At what point does the data dictate a change when it sees a drop in consumer interaction with said ad?”To resolve these issues, Google unveiled the concept of machine learning and artificial intelligence into its new tool “Google Attribution” on May 23, 2017 at its annual Google Marketing Event. source
By allowing machines to make decisions based on user engagement, it allows Google to tackle avenues it has never been able to tap into with search.Google search ads may be facing inflation and an over-estimated return on investment, but with updated tools such as Analytics to improve timing & relevance and introducing new ad formats to extend its reach, with a pinch of AI & machine learning, display inventory through the display network should prove to be a very enticing venture for its price point.
Pricing, timing, relevancy and reach - Google ads has never been closer to achieving all of them and reinventing itself by reusing its oldest - most worthless piece of inventory. Display ads