Local Advertisers May Tune Out Google’s TV Offering

Google has grabbed lots of small, local advertiser dollars away from traditional media, but don’t expect the pizza place or dry cleaner down the block to place TV ads with the company anytime soon.

Google TV Ads, officially launched in April, made a splash this week with its deal to represent ads on NBC Universal cable stations. While it claims to have run thousands of TV campaigns, the fact is Google has attracted more national or location-neutral advertisers to the nascent offering than local marketers of the sort that have gravitated towards its search ad products.

The lack of geographic targeting may be a hurdle as local advertisers become aware of the service. Google can deliver TV ads nationally across the DISH network and in the San Francisco Bay area through a relationship with cable network Astound. The new NBC Universal partnership will allow Google to sell national spots on CNBC, MSNBC, Oxygen, Sci Fi, and other channels.

However, although Google and NBC plan to determine ways to add local TV inventory in the future, currently ads can only be targeted by day-part, program, and network.

“Targeting on the TV is not nearly as efficient as targeting online…and that’s a big problem,” JupiterResearch Research Director Nate Elliott told ClickZ News. Indeed, refined targeting is among the reasons online advertising and Google itself have influenced large and small advertisers to shift ad budgets to the Web.

“Part of the focus of Google TV Ads is helping small businesses — advertisers that never thought of going offline to boost sales,” said Google spokesperson Elisabeth Diana.

The TV ad service has attracted advertisers like The Hanley Center, an alcohol and drug rehabilitation center in West Palm Beach, FL, and online perfume shop FragranceNet. However, such advertisers aim to reach much broader audiences than local advertisers do.

In appealing to local advertisers, time, effort and money are major considerations. Unlike Google’s search ad system, which enables anyone to quickly create a relatively low-cost text-based ad, the TV Ads product takes time. Elliott noted, “I can’t create a TV spot in 30 seconds.”

That said, creative support is available for the platform. Online video ad creation player SpotMixer allows advertisers to build ads for Google’s TV service, and Google connects advertisers with pre-made ad content, as well as acting talent and ad production services. Yet Elliott suggested larger brands, many of which already have ad libraries, are the ones that will benefit most from the TV offering. “[Google is] leaning on their existing best customers and by and large those are big brands,” he said.

The service could benefit large brands making big buys by making the process more efficient and less expensive on a large scale. But, said Elliott, “It can’t be a targeting play; it’s an efficiency play and a reporting play.” According to Diana, Google offers “second-by-second data” on campaign performance.

Regular buyers of Google’s online ads probably are aware of the TV platform since Google promotes other products like its Print and Audio Ads alongside it, “but most mainstream small business advertisers are not aware of it,” said Greg Sterling, local media consultant and principal of Sterling Marketing Intelligence.

Local advertisers have proven difficult for online ad firms to attract, especially if sellers don’t have feet on the street to pitch their wares to busy and budget-constrained business owners. Part of Google’s value proposition is its do-it-yourself approach. While the firm has online tutorials and webinars to educate advertisers on the TV platform, automation is the name of the game.

“You have to reach out to [small, local advertisers] in some way,” said Sterling. Because Google hasn’t made a local sales force a priority for the product, they may not attract small advertisers, suggested Sterling. “The bottom line is it’s hard to get to this market,” he added.

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