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No.2 Google.
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Author: Slavens, Roger
Section: MEDIA POWER 50: TOP B-TO-B ADVERTISING VENUES
Flush with cash from its successful IPO, Google invested in tech, new products
LAST YEAR, GOOGLE'S
harshest critics said the search giant was ripe to lose ground to
growing competition from the likes of Yahoo! and Microsoft. They also
said Google's highly publicized and unorthodox initial public offering
would be underwhelming. They couldn't have been more wrong.
Google posted
first-quarter revenue of $1.256 billion, up 93% over the same period
last year. Moreover, net income improved more than 476%, from $64
million to $369 million.
Google's shares
started selling last August at $85 and at the end of April were trading
at about $200. The billions of dollars the IPO generated have mostly
been invested in the company's core technologies and new product
development, including extended b-to-b services, said David Hirsch,
Google's director of b-to-b vertical markets.
"For one," he said,
"our AdSense network, which provides contextual ads on participating
Web sites, has continued its rapid growth and now includes a who's who
of business publishers, including Reed Business Information, VNU,
PennWell and Ziff Davis."
The combination of
ads on publishers' Web sites and Google.com enables marketers "to get
in front of prospective customers at every step of the research
process," Hirsch said.
Adding another
wrinkle to the AdSense program, The New York Times recently reported
that Google has begun to test display ads- -as a complement to Google's
text-only ads â€" on publishers' Web sites.
Google is also
working with b-to-b clients to redefine certain success metrics. "We
recognize that b-to-b transactions often involve longer buying cycles,
so we want to be able to account for all the steps it takes to get to
that final purchase, tracking depth of involvement, lead generation,
information downloads, requests for proposals and more," Hirsch said.
One telling sign that
search advertising has become more important than most analysts
expected is that companies are creating new positions dedicated to
managing the search function, Hirsch said. "You now have heads of
search and search managers responsible for maximizing their companies'
search performance," he said.
Media buyers are
still amazed at Google's performance for their clients. Said Donna
Mercer, partnermedia director at ad agency Howard, Merreli &
Partners, Raleigh, N.C.: "Google works, and they're a great
organization to work with."
Robin Donovan, senior
partner-media at Bozell & Jacobs, Omaha, Neb., said, "There's still
a group of high-powered business executives that don't even know how to
use their own e-mail, but the ones that do are Googling everybody."
But while search and
online advertising have grown substantially, Hirsch said, marketers
still aren't devoting enough of their budgets to it.
"The time spent
online is becoming equal to the time spent watching TV but TV ad
budgets still far overshadow online ad budgets," he said. "That remains
a challenge for us and other online advertising venues moving forward."
Phone: (650) 623-4000
URL: www.google.com
Traffic: 80.1 million unique monthly visitors
Ad revenue: $3.2 billion
Ad rate: Search terms start at pennies per keyword
PHOTO (COLOR)
~~~~~~~~ By Roger Slavens
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