Why Search Engines are Acquiring Agencies
Google has acquired DoubleClick for $3.1bn, Double click is an Ad company working with Advertisers and Publishers in Ad business. They developed a DART product respectively for Advertisers and Publishers to help target and manage campaigns to meet their respective goals.
Google is already a leader in Targeted Advertising both Text Ad/Image Ad display. They have great products such as Adwords & Adsense for Advertisers & Publishers respectively; this technology is for anybody and requires little or no human involvement from Google’s end.
The main question is why did Google Acquire DoubleClick? Some of the reasons I can think for are:
1) Google took inspiration from Overture to build an Ad system to display relevant text ads based on search terms. They built a system and revolutionized it in a big way. Now they might be thinking of repeating the history again with DoubleClick. DoubleClick has DART, which Google might want to make it enormously scalable for anybody to just plug and play. They might want to keep the human intervention to the minimum level and let technology work the maximum, mainly to reduce cost which ultimately benefits the end user.
2) The Ad business is growing at a rapid rate, with internet overtaking Radio and competing with Print. Ad Agency business is really on the rise. Google wants to have a share of that pie too. It not just wants to be a medium to offer and manage inventory, they would also want to actively work with advertisers and publishers to meet their end goals & take major share of the pie.
3) Most Agencies managing Ad business apart from few good ones do not have long term satisfied customers. Most companies are looking for more accountability and reliability from Agencies. Google is more trusted than anyone in the online industry.
4) Google being the leader in the Online Ad selling; its move towards vertical integration is very natural.
Google would be using its technological expertise in combination with DoubleClick’s business acumen & client servicing capabilities to reach it goals.
Yahoo has in acquired Right Media to be able to compete evenly with Google.com. To state another interesting acquisition is Google acquiring Performics, since Performics is a part of DoubleClick. Performics is a company that sells SEO services to its clients. So, formally Google has acquired a SEO Company, I am sure its business would increase whether Google actually supports it or not.
What will Google do with Performics is yet to be seen….
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Pierre Foucart said,
May 21, 2007 @ 5:45 pm
I don’t think that search engines acquire advertising agencies… Google and Yahoo are much more than search engines… Google is an advertising agency, an advertising solution … It’s no longer a search engine
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