Google's Economic Impact Report: Just A PR Ploy?

Today Google announced that it had generated $54 billion worth of economic activity in the US in 2009. The report, which shows state by state economic contribution, bases Google's total value on three factors: 1) Sales driven through AdSense and AdWords; 2) Ad revenue generated for publishers through AdSense; and 3) Google grants. As a research analyst, I'll admit that you can make numbers tell any story you want to, and my gut here is that this report is principally a PR effort to: 1) Communicate some altruism about the Google brand that has been getting some bad press of late; 2) Simplify the complex transformation Google has brought to advertising into a simple, single number; 3) Shift the focus away from questionable strategic decisions that Google has recently made. I wholeheartedly believe that Google has transformed advertising and is almost singularly responsible for the phenomenon of biddable media buying which I think will ultimately replace relationship-facilitated media buys across channels. But I don't believe that Google stimulated $54 billion worth of business. I think what Google did do is provide a new revenue stream to small businesses and site owners, catalyze some new sales, and take a share of commerce and media expenditures that would have happened anyway.

Intercontinental Hotels: A Case Study In Customer-Centric Marketing

I just attended Unica’s annual Marketing Innovation Summit (MIS) this year in Orlando.  I sat in on a few terrific conversations about making multi-channel marketing a reality.  Here is the first: An overview of Intercontinental Hotel Group’s (IHG’s) use of data-driven marketing to improve communications with existing customers and prospects.

Lincoln Barrett, vice president for guest marketing and alliances, shared that, for IHG, building a customer-centric marketing strategy hinged on three different, but overlapping, initiatives:

  1. Invest in technology
  2. Expand into new frontiers
  3. Build a centralized customer organization

Each of these initiatives is still a work in progress, but excellent progress has already been made in each one. 

Invest In Technology

Step one here was to build a new data warehouse and real-time data mart that would allow IHG to match the data it was gathering through proprietary and third-party sources to existing customer information.  This step also made it possible to gain immediate access to data for analysis or campaign building purposes – a significant upgrade to IHG's previous functionality, which updated records in batches and only made data available some 30 days after a customer incident (like a hotel stay).

The next step was to expand outbound campaigns beyond email.  Technology upgrades (using Unica) automated internal campaign processes, created localization capabilities (for franchisees to create programs customized to their locale and customer relationships), and integrated call center data and activities with outbound campaign management.  As part of this step, IHG also streamlined its formerly multi-agency model into a single global agency.

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Efficient Frontier Announces Integrated Search And Display Platform

Efficient Frontier announced last week its official entry into display advertising with a platform that integrates biddable display with search marketing, real-time bidding capabilities, and the Efficient Frontier trademark portfolio approach to optimization that uses predictive modeling to forecast performance outcomes.

I think this certainly indicates further momentum into the world of biddable display media, and eventually biddable media in all formats. See more about Forrester's thoughts on dynamic media buying and what it will mean for media buying on and offline in the report, Demystifying the DSP

I think the platform from Efficient Frontier addresses a much needed combination -- that of paid search and biddable display media. But I also think that this platform, competing ones -- like those developed by Vivaki -- and demand-side platforms are in “version 1.” Not a bad place to be at the early stage of an emerging opportunity. But I do expect that all of these tools will refine over the next two years. I think they will continue to add data sources, more inventory, additional and easier to use functionality, better metrics, and better reporting. But v.2 will develop only after advertisers begin testing dynamic media buying and can show technology players what additional depth and breadth they need.