Google believes in integrated campaigns
A billion Google searches a day speak for themselves. No advertiser can ignore a figure like that. Particularly as it is rising all the time.
Google’s success is both fascinating and frightening. The internet economy opens up business opportunities, but at the same time the ‘new’ players are mounting an increasingly strong challenge to traditional media.
Holmen’s paper has visited Google’s Swedish office to find out more about the fastest growing challenger of them all. How do they feel about the traditional advertising channels such as newspapers and direct mail?
A connected country
Of course the office in Stockholm is only one of around 70 Google offices, but Sweden is a market where almost everyone is online and it has one of the highest proportions of smartphone users in the world. What happens in Sweden can thus serve as an indicator of what is happening globally. Although it is almost 9 000 km to head office in California, the Swedish office has a special position in the Google empire.
“Of our 90 or so employees, around half are specialists who are helping to drive key parts of Google’s global product development. Sweden has great technical expertise in this field and the internet economy means a lot to the country,” says Stina Honkamaa, Country Director of Google Sweden.
Partnership with Posten
Google Sweden’s partnership with Posten AB is an example of how new and traditional advertising channels can work together. DM customers of Swedish postal service Posten AB are offered the option of purchasing Google’s AdWords search marketing service, for example (see below) to support their campaign. Both parties say that they are very happy with this collaboration and want to explore more combined services.
Searches growing fastest
Globally in 2001, Google turned over around USD 38 billion, the majority of which came from ad sales on the company’s 180 sites. On the Swedish search site alone, between 25 and 30 million searches are made every day, a fact of which advertisers are well aware. At the moment, search marketing has only 8.6 per cent of the total Swedish advertising pie, but it is the fastest growing advertising channel, together with mobile ads. Forecasts suggest annual growth of at least 25 per cent. In the UK, which is taking the lead in this area, search marketing already accounts for over 20 per cent of the total advertising spend.
Google is clearly becoming an increasingly strong competitor in the advertising market, but Stina Honkamaa points out that there are synergies between new and traditional media and that they have opportunities to develop together.
“In our experience integrated campaigns, for example those that combine TV, print and the internet, make the greatest impact,” she explains.
Jeanna Rutherhill, who is Sales Director for the Media and Entertainment business area, has many examples of print marketing driving traffic to the internet. For example, it is immediately apparent in Google’s search statistics when major retail chains such as Media Markt or H&M run print campaigns. The mail shots generate a desire to buy and the consumers then head to the advertisers’ websites, often via Google. If the advertisers have also backed up their campaign with something such as Google AdWords (see below), the impact is usually even greater.
Revenue for newspapers
Google also sees opportunities for collaboration in the newspaper market, but here the focus is, of course, on the online editions. The service that Google is pushing most is AdSense (see below). According to Google, AdSense is already generating revenue of around USD 6 billion per year globally for these and other publishers. That figure is predicted to increase significantly in the future.
“We see numerous opportunities for newspaper and magazine publishers to use the internet to develop their business models in partnership with us,” says Jeanna Rutherhill.