The Long Tail Eats the Head

Google's business model derives from the long tail of advertisers, as much of the growth in online advertising has done. Whilst ad spend online has rocketed, the vast majority of this spend comes in relatively small increments, from relatively small advertisers. The lower entry costs and demonstrable returns that search marketing can deliver tempted innumerable smaller players into advertising.

Now Google is providing a similar service on other media. 

Google Audio Ads, derived from its acquisition of the dMarc automated radio ad platform, takes it into radio. It's opening up traditional broadcast media to the long tail.

Yesterday, Google announced it would be rolling a similar model into newspapers, following a test in magazines last year. Newspapers are under pressure fill some of the holes in their ad revenue  caused by the migration of much of their traditional inventory, such as classifieds, online. Using their AdSense model, Google intends to facilitate the flow of money back into papers, by making their display inventory a viable option for smaller advertisers.

But brokering the deals isn't enough to generate the greatest value from the long tail - they want a bigger piece of the action that they have enabled. Hence Google are now looking to buy into Clear Channel radio. By rolling out their model across other channels, and then buying themselves into them, Google can begin to offer a complete cross channel advertising solution, becoming a traditional media owner, as well as the world's largest media company.

The long tail of advertising is enabling Google to eat the head of mainstream media.

People thought AOL /Time Warner was a big deal but the synergies available to a channel and content provider at that time were overstated.

But when Google starts to buy its way into TV, the media landscape is going to change completely.

Comments

[simonw]

interesting development. It's hard to find to many specifics on this but it appears that they really do mean putting other brands ads into printed newspapers. I wonder if google understand properly that press advertising works very differently to web ads. Call me a media planning dinosaur but the notion of effective frequency should still mean something to most press advertisers (in a way it doesn't and probably shouldn't on the web). Hard to see how new small advertiser is going to able to control the roll out of his advertising and therefore the delivery of audience exposures if it's all being bought opportunistically at auction. I'd worry that these fledgling advertisers may therefore see no effect from their randomly constructed shcedules and therefore be scared off 'old media' forever. Hang on - maybe that's just what Google want. Fuckin' genuis.