The rapid growth of mobile platforms this year has put to rest any doubt that digital marketers may have had about jumping in. The recent successful launch of Android coupled with the continued growth of iPhone sales (even as the recession continues) point clearly to a continuing transformation in the portability of the online experience for most Americans. Google‘s deal to buy AdMob serves to reinforce this wisdom.

After all, it’s not just about AdMob’s ad-serving platform. So much of Google’s success in the world of search advertising has been built on the back of analytics – how they cull and act on data in-house and what they offer to advertisers and consumers as a benefit of service. There is no doubt that whether or not Google’s own mobile OS dominates, AdMob’s platform agnostic nature gives them directional insight into mobile as a whole.

Here are the basics that every marketer and advertiser should know:

Background on the deal

On November 9, 2009 Google announced an agreement to acquire AdMob, a leading mobile display advertising company, for $750 million. The acquisition is Google’s largest since its $3.1 billion purchase of DoubleClick in March, 2008, and its third-largest ever after the $1.65 billion YouTube acquisition in 2006. Founded in 2006, AdMob has served more than 125 billion mobile ads on nearly every major consumer mobile OS, including both iPhone and Android.

Why we think this took place

Google believes that the future of mobile has arrived. With the aquisition of AdMob, the search giant is positioned to leverage a powerful publishing, advertising, and distribution platform in the ever-expanding mobile ecosystem, greatly accelerating Google’s previously anemic efforts in the mobile display space. Like the DoubleClick and YouTube acquisitions, Google has bought into a platform that is an industry leader. Along with scalable technology, AdMob gives Google:

• Publisher relationships that garner significant distribution (think AdSense for your phone).
• Data and insights into how consumers interact with mobile apps, which in turn yields smarter analytics invaluable in shaping the continual development of not only Android applications but also the underlying platform

Implications of this announcement

Both advertisers and users will benefit from more mobile content and more relevant, targeted ads. Specifically:

• This acquisition will allow Google’s advertising partners to better target their ads to mobile users, by marrying AdMob’s mobile publisher network with Google’s large network of advertisers.
• By combining the ad targeting technologies of AdMob and Google, this acquisition is likely to yield better ad performance on mobile applications and websites.
• This will further the evolution of location-based targeting for retail and local business helping to fulfill the promise of connecting digital with offline services and purchases.
• Google’s advertising partners will continue to have a choice of more than a dozen mobile ad networks to use in placing their ads on mobile platforms.
• It offers advertisers the convenience of a one-stop shop to increasingly plan and optimize mobile efforts in tandem with other digital media channels including search, display, and video.

The potential downside is that in the absence of competition on this scale, prices in the mobile ad space could go higher in the short term. It should be noted however that to-date, Google’s performance for advertisers seems to undercut this notion.

We believe that this deal signifies the arrival of mobile marketing as a mainstream marketing tactic. Although this channel is just getting started, today’s short-term opportunities in the space represent tomorrow’s core marketing capability.

Tags: AdMob, Advertising, DoubleClick, Google, IPhone, Search Engines, Searching, YouTube

This entry was posted on Wednesday, November 11th, 2009 at 9:40 am and is filed under Advertising: Online, Google, Mobile, Technology. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.