Google targets verticals with new ad support

Google is working with vertical markets to target advertising to drive both online and offline sales.

Google is ramping up its efforts to help specific vertical markets create more effective online advertising, using its technology to help clients highlight as many of their assets as possible to drive not only online, but also offline sales.

At its New York office Thursday, the directors of Google's vertical industry practices discussed some of the ways Google is changing its advertising strategies to be more industry-specific, something that the company hasn't traditionally done, said Tim Armstrong, president of advertising and commerce, North America, for Google.

Armstrong said Google wants its advertising practices to be so vertical-specific that in the future the specialists in those markets will be driving the company's advertising strategy, so much so that he joked the he would be out of a job.

"The vertical people will be running Google," Armstrong said. "I'll be the least useful person in the room. ...If you were to come into Google for a day, you'd actually see the industry groups have become the most specific connection point with customer."

Most companies don't have a quantitative view of all of the assets they have for sale, and part of what Google is helping vertical industry customers do is take stock of all of their offerings so they create better ways to constantly reach customers, he said.

As part of this strategy, Google's retail advertising practice is working on new technology that will help companies in that space assess all of the resources on their Web sites so they can more carefully choose keywords for targeted advertising.

Currently, Google is working internally with customers to help them do this, but the company is still handing hard-copy results to customers, said John McAteer, director of Google's retail practice. In the future, however, Google wants to provide an automated way to crawl and index an entire Web site, so companies can electronically compile all of its assets and generate keywords on their own, he said.

Eventually, Google will offer the technology as a public tool, similar to one it already includes in its AdWords platform that helps customers crawl their Web sites to come up with relevant keywords for ads, said Brett Goffin, industry sales manager at Google. Neither McAteer nor Goffin could provide a time frame for when this tool would be made available.

As part of a presentation Thursday, McAteer and Goffin outlined a case study in which Google teamed up with Rooms to Go Furniture, a company whose top executive was skeptical that online advertising could drive offline sales.

Google worked with the furniture company to place online banner ads in local markets, targeting several U.S. metropolitan areas to drive customers to local stores. When the campaign was over, Rooms to Go saw a return of more than seven times its investment, and customer average order size 20 percent larger than the retailer's average sale. Moreover, retail stores accounted for 86 percent of sales, while only 14 percent came from e-commerce sales, McAteer said.

In addition to its retail work, Google also has been doing market research to help other verticals, such as the automotive industry. The company's automotive market team plans to hold a Webinar on Oct. 11 to reveal the results of a study it conducted with Compete to discover buying habits of customers in the automotive space.

Bonita Coleman Stewart, Google's industry director for automotive, said the two companies found that the time to market for automotive shoppers has shortened to one month, reducing the amount of time companies in this market have to reach customers with campaigns. She said that Google has not identified how it will use this information to serve its advertising customers, but that will be part of the discussion on next month's Webinar.

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Elizabeth Montalbano

IDG News Service
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