Posted April 17, 2007 9:01 am by with 1 comment

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Rest assured, I’m not going to bombard you with every news item that happens to mention DoubleClick – the last thing I want to be is the Entertainment Tonight of marketing news! That said, Business Week has some additional thoughts on the deal.

Here’s what you need to know.

While DoubleClick has started an ad exchange, that’s not its strength…

DoubleClick’s main business isn’t auctioning off advertising. If say, AOL had a relationship with Nike (NKE), DoubleClick would track the performance of that ad—how many times it was clicked on, how many times it was served, what sites people who clicked on the ad had recently visited. But it would not pair up Nike and AOL.

Google won’t have the monopoly its competitors are implying…

…even with a Google-owned DoubleClick, publishers can still sell their display ads themselves and set the prices however they want. “Advertisers aren’t going to Google because someone is twisting their arm,” says Hallerman. “Similarly, the advertisers and publishers won’t stay with DoubleClick unless they find it beneficial.”

But, it might have more knowledge than you’d care for it to have…

The threat is that Google could use what it knows about what publishers are charging for their ads—based on its ad tracking—to undercut prices. For example, people fear Google could tell advertisers: “I know you are paying $5 per click on AOL. Advertise on YouTube and I’ll let you have the same ad for less.”

And Google has a habit of waiving fees in order to wipe out competitors…

Google could offer to waive all the fees for DoubleClick customers, providing they either allow Google to deliver search ads on their properties or, if the client is an advertiser, buy search ads from Google.

And lastly, Google knows that DoubleClick is worthless, if they mess with the relationships…

Google has a lot to lose by bullying advertisers or publishers—about $3.1 billion. Without the relationships, DoubleClick isn’t worth nearly as much to Google. It will want to play nice.

  • MJ

    Publishers that allow Google to sell their display ads, text ads, radio ads, TV ads, print ads and now act as their third party ad server, are quite simply letting the fox into the henhouse. Part of Google’s increasing strength comes from the acquisition and development of these relationships with advertisers. Publishers and media companies live or die based on their relationships with their advertisers. The more publishers let Google do for them here, the less directly relevant they become to their advertisers.

    More thoughts: