This Monday, Google announced its acquisition of Teracent, a display advertising firm specializing in intelligent display advertising. This deal comes just two weeks after the massive $750 million dollar purchase of AdMob two weeks ago.
Teracent works with an algorithm which helps advertisements to be modified on the fly. This can help ad agencies modify parameters like images, products, color etc in real time, increasing effectiveness of the advertisements.
“Teracent’s technology can pick and choose from literally thousands of creative elements of a display ad in real-time — tweaking images, products, messages or colors. These elements can be optimized depending on factors like geographic location, language, the content of the website, the time of day or the past performance of different ads,” read Google’s blog posting.
For example, a clothing store can display ads for snow jackets to people in Alaska. If someone from Brazil were to go to the same page, the ad could be modified to show summer clothing. This additional flexibility offered by real time advertising is a big win for advertisers as they can hit their audiences exactly when they show intent.
The online display market currently is dominated by its rival Yahoo!, with a market share of 14.5% compared to Google’s 2.2%. Co-incidentally, Teracent had also had ties with Yahoo! in mobile ad delivery. How the acquisition by Google will affect this partnership isn’t quite clear, but it isn’t hard to see that it will most likely fizzle out.
The acquisition of Teracent by Google comes after its recent acquisition of AdMob and DoubleClick. All three companies are based on advertising technology. Though search marketing had grown faster than display marketing, Google had said earlier that there will be a shift in the near future. The recognition of this fact by Google seems to be the motivation behind these recent purchasing sprees.
Though Google’s growing advertising muscle may seem bad for traditional advertising, small businesses seem to be the big benefiter. Traditional marketing tends to cater only to a few big organizations. With this massive online presence being built up by Google, small businesses can get as much if not more exposure as big guns get through traditional advertising at a fraction of the cost.
Traditional media like radio, television and print do not have the capability of the internet to reach millions of people at the same time. And even so, through these media it is hard to target just the relevant audience. Through keyword based marketing, businesses have the choice to advertising just to their audience. And since they pay based on this model, almost all the capital expenses on advertising spent by the companies go toward an audience that is more likely to respond. Of course the big guns can use the internet as well to advertise their product, but the playing field is a lot more leveled on the internet.
Who might be next on their purchase list is hard to say. However what we can take for granted is that they will add new twists to the advertising game. Constant innovation and key purchases of new technology seem to keep Google consistently ahead of its competitors. And so far, it has meant good news to small businesses. Let’s hope this trend keep growing in the future.