Monday, October 22, 2007

He has no credibility, but I think he's 100% correct

For several months now, I have been privately telling anyone willing to listen that search advertising, though incredibly effective, is over rated. At first glance, it would appear that advertising to someone in context of his search activity is an utter utopia for marketers. What better time to advertise a DVD player, for example, than when a consumer types "DVD player" into Google's search box. I agree that in context advertising is as close to utopia as marketers will ever get, but they cannot ignore their other marketing efforts.

What many search advertisers are failing to consider is the impact all their other marketing spend has on their search spend. Back to my example: when you search for "DVD player" on Google, there's a reason why you're 100 times more likely to click on a link to Samsung rather than a link to Apex. For starters, you have heard of Samsung but you've probably never heard of Apex. Second, when you researched various DVD players over the prior few days, you read a lot of positive reviews about the Samsung product but saw next to nothing on the Apex product. Finally, Samsung has a high-tech, high-quality brand. Apex has a cheap, made in a low quality way kind of brand.

Today Bloomberg news reported that Brian McAndrews, an executive at Microsoft, predicts ad buyers will switch away from search advertising and towards display advertising. At face value, it looks like a desperate attempt from Microsoft, which is badly trailing Google in search, to pooh-pooh the segment where it is weak and try to persuade advertisers that banner ads are more important. It's definitely a convenient argument given Microsoft's massive quantity of unsold banner ad inventory and weak search market share.

However, there is an element of truth in the statement. Advertisers are failing to examine the impact their non-search advertising is having on search. They are attributing all of their advertising success to search simply because it is usually the last ad seen by a user before the purchase. Just because it's the last ad doesn't mean it's the only (or even most) important one.

What advertisers need -- and what I would like to invest in -- is a company offering a web-based analytic product that helps bring banner ads, email marketing and search marketing all into a single dashboard/framework. It would allow an advertiser to measure the impact of increased banner advertising on the efficacy of its search marketing. In other words, the tool would allow advertisers to properly measure and allocate performance across ad media.

I have yet to come across such a product. Have you?