Google Trains Crosswires on Radio Advertisers

15 December 2006

MOUNTAIN VIEW, California: According to the Hoop Conjecture, an imploding object in deep space transmutes into a black hole when a circular hoop with the critical circumference is placed around the object and rotated. Some onlookers now wonder if such a 'hoop' is beginning to girdle Google?

The latter's insatiable, Wall Street-driven, appetite for new ways in which to squeeze pips from the advertising orange might in a light-year or two prove to be the 'hoop' that heralds implosion.

Sergey and Brin's latest dollar-printing wheeze is a system for buying radio ads. It was this bait with which the two dudes and ceo Eric Schmidt lured around sixty major radio advertisers to Google's Mountain View campus.

Seduction was definitely the name of the game. The dudes and Schmidt entertained the ad honchos to a candlelit dinner prior to day-long presentations. And at lunch the next day, the dessert comprised large cookies in the shape of each guest's corporate logo.

The Casanova antics appeared to be effective. As Alan Cohen, cmo at Gemstar-TV Guide International observed after the event: "It didn't seem very daunting to do business with Google."

Google's ultimate goal, Schmidt revealed, is to enable the buying of radio slots via a broad menu of ad types distributed via Google's single web-based interface.

"The long-term fantasy is we walk up to you and you give us, say, $10 million and we'll completely allocate it for you" across different media and ad types, said Schmidt in an interview.

"All types of ads can be made more effective, for instance by targeting them to consumers more likely to be interested in them, he hyped.

Agencies are understandably less than enthused by Google's offering - pointing to its elimination of the personal relationship between buyers and sellers, seen as a key element in effective negotiating

There is also growing concern that Google's ultimate goal is to persuade large advertisers to bypass agencies and channel all sectors of media buying and selling via Google.

Google insists that such worries are unfounded. "Five years from now there will be more work done by those agencies," ripostes Google's vp of advertising sales Tim Armstrong.

However, Schmidt, his boss, is more pragmatic and concedes that some types of work undertaken by ad agencies "could change". As to which types and what extent, he diplomatically failed to elaborate.

Data sourced from Wall Street Journal Online; additional content by WARC staff