Second up in my series of crowdsourcing the CM Summit conversations (first up was Laura Desmond) is David Rosenblatt, former CEO of Doubleclick, now a VP at Google. David is something of a DoubleClick lifer, having joined the company in 1997 and rising from tech lead to CEO of a company valued at more than $3 billion when sold to Google in 2007.
Readers of Searchblog will recall the industry charlie horse that the DBLCK deal caused – Microsoft lobbied mightily against it, US and European governments took their time approving it, everyone else went on a drunken ad network buying spree, and one could argue that the deal set the painful decline of Yahoo in motion – here was Google, taking square aim at Yahoo’s one remaining stronghold – display advertising.
It’s been so long since the deal was announced – a year and a half – it’s easy to forget it didn’t really get final approval till March of this year. The integration, in other words, is still in its first six months, and Rosenblatt took a portion of this summer off before rolling up his sleeves and getting back to work.
I’ve spoken to David several times since the deal closed, and like Laura, find him both candid and real – he knows Google’s strengths, and he recognizes the company’s weaknesses when it comes to the brand side of marketing – where DoubleClick has done the lion’s share of its business. So I’ll be particularly interested in his take on where Google might take its fledgling efforts in non-algorithmic media.
(To register for the CM Summit – nearly 350 already have – please head here).
My questions for David include:
– With YouTube and DoubleClick, Google’s spent $5-6 billion to get into the branded display business. Yet 98% of its revenue is in AdWords/Sense. How will that bet pay off inside a corporate culture obsessed with scale and algorithms?
– Google made its brand on not owning and operating media sites. But with YouTube, Knol, Gmail, and now apps, that seems to be changing. What does that portend for branded media plays in the future?
– What is his view of Yahoo and other competitors – Microsoft, AOL?
– The Yahoo/Google deal – does it have a display element? Will it clear the antitrust hurdle?
– Many in the advertising/marketing community call Google “frenemy” (Sorrell). What do you make of this reputation?
– Display is now about a $1bb business inside Google – in other words, very small. Where will Google be in terms of share of display revenue in five years? How will it grow?
– How will DoubleClick as we know it now change and be integrated with other Google products – analytics, apps, AdWords….and how will you deal with the issues of data privacy and transparency?
– Are you seeing the effects of the economy yet?
These are the first questions from the top of my mind. What are yours?
— How can you typo “does” and avoid the spell checker twice within the span of 3 questions?
Sorry about that. My “s” key sticks fixing it.
With YouTube and DoubleClick, Google’s spent $5-6 billion to get into the branded display business. Yet 98% of its revenue is in AdWords/Sense. How will that bet pay off inside a corporate culture obsessed with scale and algorithms?
I would ask the same question, but with a different emphasis.
Rather than asking about how the deal will “pay off”, I am more interested in the fundamental philosophical shift that this deal represents. I would ask: “Regardless of how it actually happens, what makes Google execs now believe that display advertising *will* pay off, especially when they didn’t before?”
There may not appear to be a big difference between *how* it will pay off versus *whether* it will pay off. But the fundamental shift in thinking on the part of Google execs *that* it will pay off, no matter how it happens, is the more interesting question to me. Especially when these self-same execs railed for so many years against all forms of “irrelevant” advertising, and claimed that Google only shows advertising when it is relevant to a user’s information need.
What changed their mind?
Clearly, then, Doubleclick represents a shift, and a loss of faith or loss of belief (or loss of idealism?) on the part of Google that advertising should only be relevance-based. So to me the more interesting question is how this loss of faith occurred. Or conversely, if irrelevance-based advertising is now perceived as such a boon, some commentary on why they were so wrong for so long would be helpful.
Given his M&A background before DBLCK, I’d ask him: if he’d been with GOOG instead of his own company two years ago, but knowing what he knows now about the economy and GOOG’s stock hit, was this the DBLCK deal strategically defensible? And also, now that he is with GOOG and their stock is down nearly 50 percent, what does that do to any acquisition plans or ability?
Does Doubleclick give Google access to actual net rates that publishers are collecting from advertisers through their own sales efforts (campaigns that are served and managed by Doubleclick)? Once Google has that data, how do they not use it to inform pricing, revenue shares and deal structures with those same publishers, who are (in most cases) also AdSense partners?
@chas edwards “Does Doubleclick give Google access to actual net rates that publishers are collecting from advertisers through their own sales efforts ”
From my knowledge from when I was publisher side, and my knowledge from 3 years agency side – the ad servers don’t have any knowledge as to what the rates are on the sites they are ad serving to (either as site side or client side)
My question would be on when Dblclick will release an ad serving platform that allows advertisers uniform reporting across video (ie pre-roll), display media, search, mobile and in game? So you can start getting an idea of results across all – response rates, reach, post view etc
Does Google intend to abandon the auction model across the board?
See e.g. Saul Hansell’s blog post in the New York Times today:
http://bits.blogs.nytimes.com/2008/10/08/google-to-sell-video-ads-in-web-games
John,
I like you and all but this is where your quasi journalist status fails your readers. The questions you asked David are a joke. Google has missed their quarterly numbers 3 of the last 5 quarters and now preside over a “broken” stock yet they continue to talk about space travel and energy. I would ask him about why they cannot seem to make their numbers anymore? Isn’t that the BIG question?
@jenkins – David isn’t the CEO. I can ask about the stock, but he’s the guy who runs brand advertising…
I’d love to delve into the following comment from your conversation with David:
“he recognizes the company’s weaknesses when it comes to the brand side of marketing”.
That seems to be a really interesting point he brings up and in some respects a conflict of interest in so much that the bulk of google’s business is based on last click. Many agencies, publishers, and ad networks find the “last click” mentality forced upon them by some advertisers (not all) a point of frustration. With the reams of display based data now at their disposal are they going to tackle the issue of attribution and potentially cannibalize ad words revenue?
An anonymous company rep sent me these questions:
In October 2007, as Google was lobbying Europe to approve its merger with DoubleClick, Google spokesperson Julia Holtz was reported as saying, “In response to third-party concerns, Google has committed to the European Commission that we will keep certain DoubleClick business practices unchanged.” In the interests of full transparency, can you tell us which business practices this commitment covered, and what is Google doing now?
FTC Commissioner Pamela Jones Harbour, in her dissent to the decision to approve the Google/DoubleClick merger, wrote: “In various fora, both public and private, senior corporate officials [from Google and DoubleClick] have offered assurances that the combined firm will not use consumer data inappropriately.” What steps have Google and DoubleClick taken to honor this commitment?
Google’s David Drummond testified on Capitol Hill that the Google – Yahoo! deal will not involve any transfer of personally identifiable information (PII) between the companies, and seemed to imply that this resolved any privacy concerns. Since the version of the agreement disclosed by Yahoo! redacted every provision dealing with privacy, can you tell us what the agreement provides to ensure that user privacy is fully respected?