Google still makes most of its money from selling ads next to search. For a few years now Google has been optimizing its search engine for mobile devices and now the company is adapting its advertising offerings for the smaller screen.
Google has launched a new suite of ads that make it easier to swipe and click on a mobile device. They are directed toward customers closer to the point of sale, such as people reviewing products whilst at a store or searching for plane tickets at an airport.
The problem with Google's current ad model is that it was designed for the desktop computer. Advertisers paid for their listings to show up on the same page as related search results. For example, someone searching for information on Hawaii might see an ad for an airline to the right of their search results. The problem with this on mobile is that it's harder for people to click on links. Advertisers have noticed this and as Internet traffic has moved to mobile Google's average ad prices have dropped, so something had to change.
At the annual AdWords livestream product launch conference on May 5, Google announced a new suite of ads designed specifically for mobile screens. The new ads are designed to work with touches and swipes rather than the click of a mouse.
"We see people searching for plane tickets in airports, looking for reviews in stores and getting auto insurance at car dealerships," said Jerry Dischler, a Google vice president who works in AdWords. "The user has this instantaneous need, and we have to be there with a great experience."
Dischler said that mobile searches now outnumber desktop Google queries in the U.S., Japan and eight other countries. The new ads are aimed to capture the mobile consumer and rely not on keywords but on data such as images, product specs and prices from advertisers. Google will show a rolling panel of ads, mostly images, at or near the top of mobile search results, which the user can swipe through easily. As with the desktop model, advertisers will pay per click. For example, the auto ads show a carousel of car images, which users can then click on to see details like horsepower or mileage.
The new ads are also location specific. Hotel ads which show multiple prices and reviews are accompanied by maps showing all the choices nearby. Car shoppers will also be notified of motor dealerships in their area. The new ad format also target people shopping for mortgages, insurance and flights.
"Our mission has always been to connect people with what they are looking for in the exact moment they are looking," Dischler wrote in a blogpost. "These are moments that matter to consumers, to marketers and to us at Google because they are when decisions are being made and preferences shaped."
Google also announced new AdWords tools for clients, including a new reporting dashboard and simulation tools for automated bidding, as well as recommended category targets and cost-per-clicks (CPC) for Dynamic Search Ads. There was also news about a handful of new features related to AdWords attribution and cross-device conversion tracking.
The move toward mobile ads was hardly surprising given the changes in the way we shop. It'll be interesting to see how effective the new formats are and, crucially for Google's bottom line, if advertisers are willing to pay more for the new product.