Quotes of the day: what business is Google in?

Here is Bubblegeneration talking about Google's interesting acquisition of dMarc, which helps bring advertisers and radio stations together:

You shouldn't see Goog as the world's information organizer. It's more accurate to say that it's the world's ad allocator. [Bubblegeneration Strategy Lab]
Here is Phil Wainewright saying something similar about Google in the context of Amazon's decision to open up the Alexa search API.
Imagine this scenario, which could come to fruition within a matter of days: using AWSP, a developer sets up a vertical search engine serving a market that attracts high-value pay-per-click advertising. The developer monetizes its new search engine by carrying Google AdSense. Yes, that's right, an Alexa-driven search engine that's funded by Google-driven ads. At a stroke, it becomes obvious that Google's wealth doesn't come from the fact that it's a search engine funded by advertising. It comes from the fact that it's a pay-per-click contextual advertising engine, which also happens to run its own search engine. [| Software as services | ZDNet.com]
Google as an 'ad allocator' and as a 'contextual advertizing engine'. An interesting way to think about things.

Comments: 2

Jan 18, 2006
Scott Shultz

Interesting take. It reminds me of a class many years ago in business school where we were discussing "core competencies" of organizations, and how they aren't always overtly obvious. We were discussing McDonalds, and as you would expect most of us students' ideas of their core competencies were primarily centered around food, consistency, speed, and service. The professor threw everone for a loop when he proposed that McDonalds core competency had *nothing* to do with those things and everything to do with real estate development - that they had an uncanny knack for being the first ones to place their restaurants on exit ramps that otherwise had nothing, and by their mere placement drew lots of other gas stations, motels, other restaurants, etc. I'm struck that this article draws a similar conclusion - Google's cc has little to do with searching and everything to do with internet real estate, which they have become the masters of.

Jan 19, 2006
Andy Havens

The other thing you could say Google is very good at from a core competency perspective is helping "small meet small" in terms of advertising. They started with online, obviously, with Adwords. Then they moved into print. dMarc now does it for radio. Question: when will they do it for cable TV advertising?

In the beginning, you needed to be "big" to have the money to buy big blocks of ads to talk to "big" chunks of the consumer market. Or you had to buy really small chunks of the big stuff (wee, cruddy looking classified ads) and hope for some "pull" with an audience that was actively seeking your product. Or you needed to find a publication that talked very specifically to your audience; and, even then, the costs might be out of the reach of many small businesses.

What Google has done is, as has been pointed out, provide the "Long Tail" of advertising to the Internet. And then print. Now radio. Soon DRTV (I bet).

But... as has been pointed out by other industry observers... eventually, money comes in to fill the "best" spaces in any advertising economy. The most popular key-words, combinations, slots and opporrtunities will be so well known, that they will be paid for at almost exactly the same advertising CPA (Cost Per Acquisition) as other "traditional" media. They will become, simply, part of the mix.

This happened in radio and TV when they came onto the scene and disrupted the print advertising models that had been established beforehand.

What's most interesting to me, is whether or not some larger interest (ClearChannel comes to mind in the radio sphere) will use the technology to aggregate any of the collected "Long Tails" made more accessible by Google on a vast scale. What started as a way for small companies to get an advertising message out in an inexpensive way may turn into a way for a really huge company to easily "eat" an entire memetic category.