- April 16, 2007
- 2 comments
Good post from Fred Wilson on banners:
Yesterday’s announcement of Google’s (GOOG) $3.1bn acquisition of Doubleclick says to me that the banner is back, big time. And here’s why. There is infinite demand for search/CPC inventory at a price. Search/CPC is bought on a measured ROI basis. If you know what a click is worth to you, you’ll pay up the that price for as many as you can get. But beyond that, you can’t buy more.
Many marketers have reached the point that they can’t easily buy more search. It’s getting harder. Keyword markets are becoming efficient and supply and demand are coming into balance. Of course, that alone doesn’t mean that all the other money will move into banners. Banners also need to produce measured returns.
But, banners carry branding value that text ads don’t. The return on investment measure is not as cold and hard with banners. And the big branded advertisers that are leaving TV and print in search of better performance on the internet want to be able to brand with their ads. And they want to control where those ads are run. They’ll pay more for those two features.
So branding/banners may grow faster than search/CPC in the coming years, or at least grow as quickly.
And for Google, the law of large numbers is catching up to them. How do you grow a monster at monster growth rates? Get into the other big bucket of money on the web.
Emphasis above mine.
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- Trackback: Jack on August 7, 2007
Hum, interesting post. I might wonder how long will it take until Google starts (or how it would do it) using the experience behind DoubleClick.
A glimpse of what it could look like in my humble attempt in organizing the chaos…