Google announced its long-awaited TV ad trial with Echostar and Astound in what has become a long line of offline advertising forays. What's Google up to? Creating a dashboard for advertising services.
In other words, Google is trying to do what business intelligence companies do today for enterprise customers--create a dashboard so executives can monitor returns, an ad campaign's progress and potential trouble spots in real time. In enterprise applications, business intelligence is often the most valuable player to a company. Business intelligence software is widely taken for granted today.
But the business intelligence (BI) state of affairs in most forms of advertising is a different story entirely. BI is non-existent. That's what makes Google so scary to old media. Here's what the advertising world is thinking: "If media buyers start asking for quantifiable returns we're screwed. No more dinner parties. No more golf course. No more schmoozing. We've got nada. Geesh, I don't know what this prime time advertising really produces!"
Of course, the old media types will tell you that advertising is based on "relationships." Fair enough--to a point. But that argument sounds vaguely familiar to what stock brokers used to say before online trading. Travel agents had a similar spiel.
Cutting through the din of Google concerns--synthesized in BusinessWeek--BI is the most detrimental thing to the advertising world. Think about it: If you couldn't produce real-time ROI metrics would you really want another company trying to monitor your faux statistics.
Now it's far too early to proclaim Google a big winner. The company is offering increased automation in TV advertising (see Techmeme discussion), but it's only a first step. And it's going to be a slog to bring a modicum of BI into the advertising world. So far, Google's success offline has been spotty at best. Donna Bogatin chronicles Google's efforts so far to play in newspaper, radio and TV land; she doesn't expect TV networks and advertisers to be enthusiastic toward Google's move into TV.
The biggest wild-card is going to be Google ability to partner with other media players. "We believe Google may need to partner with additional cable TV and satellite companies to offer advertisers significant offline reach," writes Bank of America analyst Brian Pitz in a research note.
The end game is clear: BI is porting to all forms of advertising. "We note that Google is clearly moving towards becoming a one-stop shop (an advertiser's 'dashboard') for purchasing advertising on multiple platforms including TV, radio, newspapers, online, and mobile and is working to build robust technologies to provide end to end support to advertisers," says Pitz.
The only uncertainty is how long it will take Google--or another more palatable company like Yahoo--to bring BI to offline advertising. My hunch it'll take a long time given television advertising is more than twice the size of online advertising. It takes a while to get those big media dogs moving.