Media buyers are increasingly moving more and more dollars to digital, but as far as percentages go, digital advertising still has a lot of upside potential. The companies that stand to realize that potential, of course, are advertising powerhouses like Google.
Google isn’t idly standing by waiting for media buyers to shift budgets. Yesterday, the Wall Street Journal wrote that Google has struck a deal with giant agency holding company Omnicom that will see Omnicom spend hundreds of millions of dollars on display ads through Google’s ad exchange over the next two years.
In return, Google “will provide analytics services to Omnicom to help it understand how its display
ads are performing.” Google is also building out a customized “trading desk” that will allow Omnicom’s media buyers to buy ads through Google’s exchange more efficiently.
According to Google VP Neal Mohan, “we’ve turned the engineering fire hose at Google toward display advertising.” That means that other players in the display ad space had better watch out. Google’s hunger to do more with display ads is clearly very serious, and by successfully courting Omnicom, there can be no doubt it will be aggressive in pursuing opportunities.
Of course, Omnicom’s deal with Google is just as much a reflection of Omnicom’s belief in Google as it is a reflection of the economics of media buying. The truth is that agencies as large as Omnicom are limited in how granular their media buying efforts get. The Omnicoms of the world are tasked with spending lots of money, and that usually requires that a lot of money is spent in a relatively small number of places. Of course, as the Wall Street Journal notes, critics of big commitments like the one Omnicom has made here will point out that such commitments don’t necessarily make sense for agency clients, who are really only interested in the success of their campaigns.
But these sorts of commitments are a reality, and as Google gets more competitive in the display space, don’t be surprised to see more of them. According to paidContent, “Google claims to have 75 percent of the top 20 ad networks on AdX, as well as
all AdWords advertisers,” which means that media buyers won’t be able to easily ignore its overtures.
The good news for Google is that the Omnicom deal will likely help it reach its goal of display ad dominance sooner than anticipated. But more importantly, it’s also good news because it’s an indicator that Google’s efforts to befriend Madison Avenue may finally be paying off. And if Madison Avenue forgets that Google was once a ‘frenemy‘, the second decade of Google’s life may be even more rewarding than the first.