Google has taken the next step in its conquest of traditional media with a new beta test of Google Audio Ads. A group of 20 advertisers have already begun buying ads on terrestrial and satellite airwaves under the experiment.
Google Audio Ads are sold on a CPM basis through the AdWords platform, and advertisers can target on factors like geographical market and time of day. Reporting functions disclose which stations ran ads and when, and real-time air checks are available, a bit of a novelty for interactive marketers who have grown used to not seeing their non-search executions.
Effectiveness metrics are the old-fashioned kind, including analysis of call volume and in-store traffic.
"If somebody's running a campaign spanning three metro markets and they're getting great call volume, they have the ability... to modify the campaign or heavy up," said Ryan Steelberg, head of radio operations for Google.
Budgets are managed in a manner similar to the company's existing bid-based platform, except the ads will be sold on a CPM, rather than cost-per-action, basis. The inventory could theoretically be monetized via action-based system like pay-per-call, but Google's steering clear of that for the moment. The beta test has no minimum spending requirement.
Ads must be in MP3 format and no longer than 30 seconds. Google has also set up what it's calling an "ad creation marketplace," which will offer to pair advertisers with the providers of audio production services. These firms, which Google suggests will charge from $100 to $1,000 to create an ad, will take care of the voiceover, recording and encoding processes -- everything but the copywriting. Marketers can also bring their own spot.
Portentous as it is for Google to move formally into the production and trafficking of audio ads, many in the marketing community are more focused on the inevitable next step: TV ads.
"Their ultimate goal has got to be to get into television and get a couple percentage points of that business," said Anthony Iaffaldano, VP of marketing for search firm Reprise Media. "They don't need a huge percentage of that for it to be a massive business."
Did-It's Kevin Lee agrees, and notes it's perhaps a bigger leap to go from text to audio ad management, than it is to make the coming transition into video.
"I would imagine that eventually video advertising on the Web and audio podcast advertising on the Web will have a very similar interface to what you see in the radio audio advertising area," Lee said.
Approximately 700 stations are taking part in the test, a number Google hopes will grow into the thousands in the coming year. Some radio stations are reluctant to jump in, however, especially those boasting effective sales forces that are able to get rid of most or all of a station or network's ad inventory.
"An awful lot of that is very low-dollar, because it's remnant," said one radio executive with a major radio network who requested anonymity. "It's based on the philosophy, which I don't necessarily disagree with, that 20 percent of something beats 100 percent of nothing. They may come out to $1 CPM, when we're going out to our advertisers and getting several times that amount. We just haven't weighed whether it would be effective for us yet."
Google notes station owners will have insights into its rates, should they want to take that 20 percent.
"This is taking our dMarc legacy technology to the next level," said Google's Steelberg. "All of our broadcasters have complete visibility of everything we're doing from the audio ads perspective. They have full visibility of rates."
Google declined to quantify ad volume or spending under the beta, and it hasn't named a date for the product's wide release.
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Until March 2012, Zach Rodgers was managing editor of ClickZ's award-winning coverage of news and trends in digital marketing. He reported on the rise of web companies, data markets, ad technologies, and government Internet policy, among other subjects.
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