As many of you have noticed over the past couple months Google has been expanding it’s reach from the online marketing world to a much broader scope where it’s competitors are thriving – the ad promo space.
The online giant is spending enormous amounts of money on TV, magazine, and newspaper ads to promote its services, including Google+ and its Chrome web browser (some of which were recognized by AceMetrix as the most effective Web TV commercials in 2011). Google’s ad spending is now comparable to Apple, Microsoft, and Yahoo, according to new data from Kantar Media.
Google spent $213 million to advertise its own products in the U.S. in 2011. This is up four times from $56 million in 2010, according to Kantar Media.
“This is a sign of good old-fashioned competition,” David Cohen, chief media officer at Universal McCann, the media-buying unit of InterPublic Group of Cos, told the Wall Street Journal. “While Google has a dominant footprint in search, they have work to do in other areas to gain market share.”
Rob Shilkin, a Google spokesman, declined to comment specifically about the company’s ad strategy.
“Our focus is on uncovering and telling stories about our products, our users and the magic they both create,” he said. “The discussion about how to reach people across different media is a much later conversation.”
It’s estimated that Google shelled out $70 million on TV ads, compared to around $6 million a year earlier. On Google+, Google spent an estimated $12 million alone in 2011. This included a TV ad featuring The Muppets who were seen using the social network’s “hangout” video chat while singing the popular David Bowie hit “Under Pressure”.
Google’s total ad spending in 2011 represented 1.2 percent of its U.S. revenue of $17.6 billion. Microsoft and Apple are both at the 1.5 percent of overall revenue.
From a company that once shunned the thought of spending any money on ad promos to now spending 1.2 percent of its revenue promoting its own products is a big change for Google. Crazy to think that Google tells companies to focus their marketing budgets with AdWords and other online marketing yet is doing $250 million+ a year in ad spending through those same sources they frown upon.
What do you think?
Image via The Wall Street Journal