Did you ever have that one friend that was always late to every party, but then when that friend finally arrived the party would change completely for the better? Google is that friend, and the party is display advertising.
At yesterday's IAB advertising conference, Google executives spent some time talking candidly about where they think display advertising is headed. And it might be worth listening to their thoughts. Even though they came late to the display ad game, they're still one of the foremost experts on advertising online.
And Google sees tremendous growth potential in the display ad market—predicting a climb from $8.6 billion in revenue this year to as much as $50 billion in five years. Why? Because of impending innovations.
Display ads, argues Google, have always been text-based. Bary Salzman, Google's Managing Director for Media, says that the format has made it "tough to engage Madison Avenue's most creative minds…" but that Google thinks "display is bringing sexy back.” (I'm not sure why a Google executive needs to reference a three-year-old Justin Timberlake song, but that's neither here nor there, I guess).
To illustrate what "sexy" display ads might look like in the near future, Salzman offered some predictions. For example, in five years, he expects 75% of more of online display ads to be social—interactive ads that Facebook and Twitter users can "like" or "retweet" or even subscribe to.
He also thinks 50% of display ad campaigns will include video—but specially arranged so that advertisers only pay based on actual views of the ad-embedded clip. 50% of ads will use real-time bidding technology—interesting. I'm not sure I even know what that means, but it sounds cool.
There was also a bit of demonstration, as Google showed off new video ad formats for YouTube called "TrueView.” Set to release this Fall and Winter, TrueView ads will allow users to skip ads they don't wish to watch or even choose from a small selection of ads to pick one they're more interested in—it's worth pointing out that ads like this already do exist elsewhere. Advertisers under this system would not have to pay unless their ad is specifically chosen for viewing by the user.
Display ads in the near future will also be location-based, they believe, changing their content on the fly based on the viewer's geographic location. It sounds like Google wants to start tailoring display ads to the users, and giving them more control over the advertising experience. Which is a smart move.
Most level-headed people understand that they're going to have to deal with advertising—whether on television, radio, Internet, or print. Giving them more control over the ads they see—and giving them something personalized that they can interact with—is very likely to increase their engagement with the ads, which will make advertisers very happy indeed.
Here is the video from Google's keynote at the IAB conference.