If Google Introduces Video Ads into Search…


GoogleYesterday Digiday reported that Google is currently talking to advertisers about plans to introduce video advertising into its search results. This news comes just a couple of weeks after Google will only be making YouTube inventory available via Adwords and Doubleclick Bid Manager DBM, suggesting that we might entering a new – and more Google-centric – phase in the tech giant’s video strategy. However, it’s equally important to remember that there is always a chance this idea might not see the light of day, as in 2011 TechCrunch broke a similar story about Google introducing video to search, but the product was shelved at the time.

While Bing and Yahoo have launched similar products for their search engines in the past, the introduction of video ads into Google’s results is of course will have a much larger impact on the wider industry. And be an easy win for Google of course. This is not only because of Google’s size as a search engine, but also because Adwords and DBM are so widely used and tightly integrated with search. Combining video with Google’s tech and intent data is going to form an extremely compelling proposition for advertisers.

Additional Bricks for Google’s Walled Garden

If recent events are anything to go by, it seems highly likely that these ads will only be made available via Adwords and DBM, which will further strengthen Google’s position in ad tech and in the video advertising market.

Supply and Commoditisation

Once Google flicks the switch, they can – in theory at least – achieve massive scale with these formats overnight. As outstream formats aren’t tied to video content consumption, they can create instant supply for anyone with traffic. But Google’s search data will of course be the key to success.

We’ve already seen how quickly Facebook came from nowhere to became a global video giant by introducing oustream ads (see graph below), and it seems likely that search video ads would enable Google to push further ahead of Facebook in terms of market share.

Facebook's Video Growth

While it seems likely that the introduction of so much new inventory will lead to a decrease in video CPMs for everyone else, it’s still unclear where the budgets for the search video ads are likely to come from. Will they be bought by the same advertisers who are currently using video to build and maintain brands, or will advertisers simply take them out of existing search budgets? The latter seems more likely.  If that’s the case, search video advertising might simply generate incremental video spend, which would be less likely to impact video CPMs elsewhere, where the spend is typically coming from brand budgets.

One area of video advertising that might be at risk is the outstream formats. If advertisers start to compare all outstream formats on an ‘apples to apples’ basis, it seems even more likely that outstream video ads will follow a similar path to display advertising, where inventory declines in value as it becomes over-used by publishers and commoditised. Quality is going to become an even more important point of differentiation for publishers, and publishers running ads against video content will be most able to differentiate and retain the premium value of their offering.

Creativity

A video ad that shows up in search results should be very different to the type of ads shown on TV. However, as we’ve seen with online and mobile video advertising, getting advertisers to buy into the idea that they need to pay more to adapt their creative work isn’t easy. So even though quick-to-the-point formats that generate conversions are a no-brainer, we should probably expect to see plenty of 30 second TV spots being shoehorned into search results.


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  • Very interesting article Vincent!

    I have no doubt that it there will be a huge impact on the ad market when Google starts with video ads. I don’t know if users can handle it, but the successful video integration of Facebook makes me optimistic about that.

    Even more interesting is the impact of google video ads on the video production industry. Video production is quite different today than it used to be in the old days of TV commercials.

    To push the online ad video market, the whole video production workflow has to change. Most firms can’t afford expensive video productions like we know them from TV. So to boost online video ads belong marketers, video production has to become way more efficient in my opinion.