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Founder
Joined: 09 Mar 2002
Posts: 43412
Location: Columbia, SC
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 I have long been a fan of the Adsense program at Google. Finally those annoying blinking "you've won this" and "click here to claim your prize" ads are finally dissapearing. At last, sites like ours can host Ads that actually appeal to our visitors; text ads (and the ocassional image ad) that are targeted to our content. Yes, I've been quite pleased with Google's revolutionary technology. So naturally, when Google recently announced its decision to start selling cost-per-thousand advertising, well, it came as a bit of a surprise to me.
Widely known as CPM advertising, this approach is about "eyeballs" rather than click-through rates. Advertisers can opt to pay based on the number of times their advertisement is shown as part of a page, rather than the number of times a person actually clicks on an advert. Basically it's a game of impressions versus clicks, and usually, in the case of larger sites, impressions always win.
These new CPM ads will not be carried in the regional versions of Google's search services, but in the network of affiliate sites worldwide that carry Google adverts. But Google's move - and its gigantic web presence - will bring a new focus to the hazy world of online advertising.
As you may know, many sites that carry advertising are audited - so that advertisers can have some certainty about the audience for their ads. It's easy to claim a million visitors a minute, all of whom are interested in buying high-value goods, but proving it requires a bit more than showing off the smoking server stack. The problem for auditors, advertisers and site owners is that while it's easy to verify visitor numbers, there is no good way of assessing who the users are, how often they visit, and whether they arrive by mistake. Several factors now make it hard to demonstrate what kind of audience a site attracts.
Google, however, is in a very unique position. Google has such a dominance on the market, that people who arrive at websites that didn't come from a bookmark came from Google's engine. Google accounts for 40 times as many visitors to PROnet's site as Yahoo, and 80 times as many as MSN, for example.
And if Google sends people, it also knows what they are after. From an advertiser's perspective, Google is actually assembling relevant audiences on the fly, and then putting them in front of pages that could carry ads. This is a very powerful proposition. And as Google grows, it could well make traditional auditors look like amateurs. The agencies that place ads online are also likely to look a little redundant, since they are in the business of optimising audiences by choosing among sites that Google sends visitors towards. The likes of DoubleClick and Fastclick would then be next for the chop. This comes despite Fastclick's recent announcements to try and "compete" more with Google.
Ultimately Google could turn its domination of searching into hegemony over online advertising. Now all of this comes from my own theories on the subject, and being the website owner I am... hey, the more power to Google. But if I was in the Ad business, the middleman in the advertising chain online, between the content provider and the advertiser... well, quite frankly, I'd be a little concerned about the future.
This all goes to prove... Google has a tight grip on the web. As a webmaster you nearly fail if you aren't in Google. And if you're in Advertising... you've lost a lot of ground to the new guy on the block.
 
John C. Derrick
Chairman of the Board
Sources: VNUnet
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