Google: Blood on the Playground

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ADOTAS – Over the weekend, MG Siegler wrote an excellent post about Google’s relationship with other technology companies entitled “With Google, There Will Be Bad Blood.” According to Siegler, Google is pissing off the tech industry because they’re trying to do everything while possessing the arrogance to think that they can.

Reading MG’s outstanding piece reminded me of my own piece from last month, “Google on the Playground,” I offered some suggestions for Google on how to seem more like a friend than an enemy. Today, I’ll look more at the relationship with Google from the perspective of advertisers and agencies.

If in pre-Internet marketing, John Wanamaker had no idea which half of his marketing budget was being wasted, today, marketers have a much better idea of what is working, and in so many cases, it is the search engine marketing results from Google which are working. This makes it hard for any marketer to forsake or even reduce Google’s share of their online ad budget.

But even if Google search is generating the best ROI, advertisers and marketers need to ensure that online marketing is not dominated by one or even a handful of solutions.  Advertisers/agencies need to:

1. Diversify their ad spend – It’s never good to put all of your eggs in one basket, and the same is true for an online ad budget. Advertisers should seek out other ad opportunities – namely Yahoo! / Microsoft – but also other ad networks, solutions and exchanges. This is the only way to create competition which will keep pricing competitive.

2. Invest in truly new/emerging technologies – I remember an ad agency executive once telling me how he liked to buy ads for clients in new magazines (this was 20 years ago) because of the novelty factor of advertising in a magazine’s inaugural issue.

On a similar note, agencies and advertisers should reserve a portion of their ad budgets for new and exploratory ad vehicles. This will help new ad solutions get off the ground while providing these entrepreneurs with much needed advertiser and agency insights. And there is buzz value in advertising in emerging technologies and reaching early adopters.

3. Broaden their ad spend by focusing on ROI and not just dollars – Let’s say ad network XYZ gives you only 70% of the ROI of Google Search. Why not offer them 70% of the budget for a comparable campaign? Most ad solutions would accept a smaller budget in order to stay in the media plan, and the advertiser doesn’t feel like they compromised their marketing objectives.

Google didn’t become a frenemy all by itself. Advertisers and agencies gave Google the power to become a frenemy. By correctly managing their relationships with Google and the rest of the companies in the online advertising ecosystem, advertisers and agencies can ensure a fair and competitive industry. Otherwise, the frenemy might become an enemy.

So what are you doing to restore the balance of power in the online advertising ecosystem?

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