Google Wins Omnicom As Ally

Google has partnered with advertising company Omnicom Media for online display advertising. This will bolster Google’s entrance into the display ad space.

As the search giant expands its marketing and advertising revenue, it needs to make strategic alliances with established marketing firms with clientele who are already spending money in the space. Under this deal, Omnicom will be spending hundreds of millions in display ad purchases for its clients over the next few years. In return, Google is working with Omnicom on an application “trading desk” that allows Omnicom to more easily purchase display advertising on Google’s ad exchange.
Omnicom has already been using the ad exchange to bid on advertising spots throughout Google’s network, using its own technology. This new setup will allow easier access for Omnicom as well as better analytics to see how ads are performing.
Display advertising, while still controversial as a somewhat untested and unproven advertising market, will be worth over $5 billion this year. 2009 saw about $5 billion with steady growth over the previous three years and industry insiders expect that growth to continue.
Ad exchange systems, such as what Google promotes, allow marketers to choose more niche-based and focused sites to advertise with. These systems create genre-based website networks that the advertiser can then bid to use for their marketing. Advertising can be purchased for specific websites or pages or for suites of websites with similar themes and visitors. Site owners sign up with the ad exchange in hopes of getting more revenue from advertising with less effort spent looking for ad buyers.
Critics of deals such as this latest Google-Omnicom agreement, say that these types of deals raise conflicts of interest questions for the industry and especially for clients and potential clients of the firms in question. If, for instance, Microsoft were to be a client of Omnicom and see this deal with search rival Google (Microsoft owns the Bing search engine), might they question their investment?
Omnicom counters this by saying that the deal renders lower-cost advertising for its clients and does not require them to put specific clients onto Google’s networks. The deal allows Omnicom to focus on its expertise and leave technology to someone who knows it best.

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