What is Google doing with its $1.13 billion dMarc acquisition?
In my first look at Google’s long-term plan for integrating dMarc’s technologies and operations to “offer AdWords advertisers a broad suite of digital broadcast options,” I reveal Eric Schmidt’s vision for how a a GPS location-based, highly targeted and personalized in-car radio ad might be delivered digitally:
Eric Schmidt, Google CEO, believes that when he is listening to the radio in his car, radio ads should personally address him about his needs. For example, while driving past a clothing store, a radio ad should remind Eric that he needs a pair of pants and instruct him to turn left at the upcoming clothing store.
The market opportunity Google is targeting is very large, according to PricewaterhouseCoopers' "Global Entertainment and Media Outlook: 2005-2009":
Growth in digital and satellite radio subscriptions, as well as the attraction to advertisers of radio's broad reach and cost-effective pricing, will help the radio and out-of-home advertising market to achieve sales of $78.2 billion in 2009 at a 5.1% compound annual growth rate (CAGR)...market as consisting of advertiser spending on radio stations and radio networks, as well as out-of-home media including billboards, street furniture, transit displays, and sports arena displays.
In the United States, the radio market also includes satellite radio subscription revenues… The U.S. will be the fastest-growing market during the forecast period, reaching $35.2 billion in 2009 at a CAGR of 5.1%... In the U.S., a rapidly growing satellite radio subscription market – expected to reach $3.2 billion in 2009 at a CAGR of 52.6% -- will offset a sluggish radio advertising market, which while totaling $24 billion in 2009, will only maintain a CAGR of 4.3%. Radio advertising's losses to local cable and out-of-home ads will in turn be offset by listener-attracting devices including digital broadcasting. High-profile programming will boost demand for satellite radio, while growth in automobile receivers and other portable formats will drive subscriptions.
As a result, the overall radio market will total $27.2 billion in 2009 at a CAGR of 6.5%. Out-of-home ads will be boosted by improved audience measurement, brighter displays, and digital technologies, leading the category to a projected $8 billion in 2009 at a CAGR of 6.3%.
I asked Tim Armstrong, Google VP of Advertising Sales, for comment last Friday on the status of Google’s integration of dMarc and look forward to learning more about how soon Eric will be hearing a reminder that he needs a pair of pants while driving (while being chauffeured?).