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Google Ad Chief Susan Wojcicki Talks about Next Big Battle

Jan 23 2014, 2:31am CST | by

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Google Ad Chief Susan Wojcicki Talks about Next Big Battle

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Google Ad Chief Susan Wojcicki Talks about Next Big Battle

Straightforward and unflashy, Susan Wojcicki doesn’t come off like the most powerful woman in advertising that Forbes and others have labeled her. When we meet outside her office at the Googleplex in Mountain View, she’s dressed in jeans and a simple maroon top and speaks with an almost self-deprecating lilt.

But as the search giant’s senior vice president of advertising and commerce, she is indeed the exec leading the development of some of the most disruptive ad technologies of the past half-century. I interviewed Wojcicki (pronounced wo-JIT-ski) for my article in the current issue of Forbes on how Google is gunning for brand advertising , the image advertising still dominated by television and the dwindling pages of slick magazines.

After picking up “detox” lemonades at a juice bar, we walked past a T. Rex skeleton sculpture festooned with plastic pink flamingos to a set of tables to talk about how the company aims to wrest away brand advertising budgets, which still constitute the majority of ad spending worldwide thanks to the persistent popularity of televisio among advertisers. Over the slap of spikes and serves from a nearby volleyball court and the occasional caw of a crow resting in the nearby trees, she explained her vision of Google’s next big step beyond search and plain-vanilla display ads. This is an edited version of our conversation.

Q: Lots of brand marketers and agencies say they can get truly large audiences more easily on TV than on YouTube or elsewhere online. Why haven’t online ads been able to provide similar branding opportunities as TV and other traditional media?

A: Most advertising is a portfolio of different types of advertising. TV definitely is effective for lots of advertisers. If we want to talk about the long-term future, the question is: Where is TV going? Will all TVs be Internet-enabled? And if they are Internet-enabled, what does your TV look like then? Is your TV then basically a screen attached to your computer in your living room? There could be all different types of things your TV looks like in the future.

Q: You still hear the argument that TV is a lean-back medium and people in that kind of environment are always going to be more receptive to brand messaging. Are people ever going to be as receptive online?

A: Even in TV advertising, they try to target specific types of users. That’s why they’ll say, “We want users who watch sports,” because that means a certain type of demographic. Users are opting into seeing specific shows on TV, and I think it’s similar with digital. They are choosing specific shows to see.

I’m not really sure that lean-back vs. interactive necessarily means that the user is more or less receptive. It’s counterintuitive that something where you’re engaging, you’re less receptive. If users are engaging with something, they’re choosing to see something. That’s the whole concept of what we’re doing with TrueView [YouTube ads that viewers can skip and that advertisers pay for only if they’re viewed], where users are choosing to see something, so they’re engaging with it.

Q: More broadly, how are you trying to tap into the brand advertising opportunity?

A: We’ve invested really heavily in DoubleClick and a lot of the advertising industry, the agencies and the large publishers, are running on DoubleClick. Part of our mission is to make it easier to buy and sell ads quickly and easily, to be able to create new formats, to enable different types of targeting.

I’ve been really excited about a lot of the stuff that’s been happening in programmatic [automated ad purchase and placement]. It’s a much more efficient way of buying and selling ads. I see that with our search ad business, which is basically a programmatic business. I see a lot of inefficiencies in the display business right now. If it were much more efficient, we could bring in a lot more advertisers and make a lot more revenue for publishers.

Q: How applicable is that to the brand advertising opportunity?

A: If you are the ad server for the publishers and for the different agencies, and you’re able to supply them with technology that can help them do that in a much more efficient way, then you can help the whole industry going forward. More money goes to the publishers and the advertisers would be able to reach people more efficiently.

Q: Why is Google making such a big push for brand ads now? The opportunity has been there for a while.

A: We acquired DoubleClick about five years ago, and we really focused first on direct-response advertising. The direct-response market was closest to our business, but it’s also easiest to innovate there. It has clear metrics, so if you’re an advertiser, you’re like I’m willing to go wherever I can get more traffic and that traffic is converting well for me. So it’s actually easy to test new things.

Brand [advertising] is really important, but the metrics have not been as clear, at least not online. One of the things we’ve been trying to adopt in our technology is just whether or not the ad was viewed. We’ve been introducing a lot of things with Active View [a standard for display ads that guarantees at least half the ad was seen for one second or more], so advertisers can get the right measurements and publishers can understand which of their inventory is performing.

Q: When I talk with agencies and brands on Google’s brand advertising push, they respond, “Oh, you mean YouTube?” Is that most of where Google’s push is going?

A: YouTube is definitely a significant piece of it. But we’re not betting everything on it. The Web is a big place and there are many big publishers, and you have to go where the users are going. The users are going to many different sites, and there’s the opportunity to reach them across all those different sites [via the Google Display Network , the 2 million websites where the company syndicates ads] at the time they’re interested in those specific topics.

Those different sites individually are small, but combined are big. They offer advertisers a really interesting way to extend their reach and get their messages out by working with one provider like Google or some other network. So we’re not just trying to enable YouTube to reach the next generation, we’re trying to enable advertising across the entire Web to reach that next generation. A large brand or advertiser can’t reach all these individual sites, so how can we aggregate it for them so they can reach the right audiences right at the time they’re interested.

Q: Brand advertising hasn’t come online much yet. How far along is it?

A: If we’re in an S curve, which is how most technologies go, we’re at the bottom of the S.

Q: What makes you think it will be an S curve, given that it has been so slow to come online despite the audience moving there already?

A: It matters what the users do, and the advertisers have to go where the users go. It’s not really up to the advertisers. It’s up to the users. If the users are all switching and if they aren’t reading print publications, they’re all going to have to adjust to tablets, to mobile, to desktops.

We just released Chromecast [the memory stick-shaped device that allows video to be sent from a smartphone or tablet to a TV]. I can’t tell you which device or what year it will happen, but there will be some device that brings a lot more Internet to the TV, to the living room. At that point, I’m pretty confident that TV will look a lot more like online video. People will have all these different channels, they’ll be able to choose what they want to watch, everything will be on-demand. I think all the different existing players will adapt to that environment.

Q: Is some of that brand advertising, which in its current form doesn’t really fit “natively” into a lot of online activities, just going to disappear or never migrate online?

A: There’s no reason that the dollars should not be equivalent to time spent. If a third of Americans’ time is being spent online, why is only a quarter of ad dollars spent there? It’s not proportional. A big chunk of the dollars will follow. Advertising is a very fundamental need, so I don’t think it’s going to go away.

When I talk to some of the big brand managers and how they allocate their dollars and think about digital, they recognize they should be doing more. But they also are cautious. It’s not an industry where people want to take their media plan that worked last year and suddenly change it 100% this year and see what happens. So they generally want to move some dollars, experiment with it, test out the tools and the metrics and then based on that, they make changes to future media plans. They are a little bit slower than the users.

Q: How have you dealt with the need to divert resources to mobile advertising in the midst of your brand advertising push?

A: As hard as we’re working, it’s not enough. It’s a different computing platform. We can’t just take what we had on desktop and apply it to mobile. First of all there’s an app world. There’s location. Screen size is different. It’s got screen capabilities like swiping, touch, all kinds of things not traditionally associated with desktop computers. And a lot of people have multiple devices today. And they use them throughout the day. Cross-device has been a really important component for us.

It’s a new technology, so a lot of the advertising components haven’t caught up yet. That’s why it’s so far behind. There’s no reason this can’t monetize just as well as the desktop. But it needs a different kind of advertising.

Q: Ads are not liked very much in the tech business and especially Silicon Valley, even though many companies make their money mainly through advertising. What has kept you working on the ads side of Google in the face of a lack of respect for advertising?

A: Certainly as an engineering problem, it’s very interesting because of the scale we work at. That in itself along with the opportunity to change and revolutionize an industry has been really interesting. Some of the stuff we did early on with real-time bidding on our exchange was really interesting from an engineering standpoint.

But the thing that really motivates me is the impact that it has on the Internet and society. I was just talking about this with one of my colleagues. What would it be like if we didn’t have ads for one day?

Q: And your answer?

A: If we didn’t have ads for a day, you would have all of these millions of businesses, a lot of them really small, who would not be able to find any leads for that day. You would have lots of people who are running their own blog and are able to finance the content they generate because they’re running ads on their site, they wouldn’t be generating any revenue. You certainly have lots of big sites that wouldn’t be able to have the same quality of content. And you’d have all the people who couldn’t afford it. So there’s a social component, too. Think if everybody had to pay for every single website that they went to.

I mean, that’s how Google generates its revenue. We wouldn’t have all these things here [waves at the many buildings in the Googleplex] if we didn’t have ads.

Q: Are you finding that you need to redefine what brand advertising is in this new world, with new kinds of media and new ways of measuring the impact of advertising in these media?

A: I’ve worked on search advertising for a really long time and display advertising for a long time. They both grew up very differently, but I see ways that they’re coming together. Search was easier because we had a really clear metric to begin with, which was CPC [cost-per-click]. What we’re also trying to do with brands is help define and figure out what the right metrics are. Because the industry hasn’t had that, it’s been a little bit of a moving target to try to figure out what do you optimize to, what are the creatives that are working.

We’re not saying it’s CPC. A lot of brand advertisers worry about that. We’re saying it can include all those soft things like sales, like brand lift–how do you measure increase in awareness. Those are harder issues than did the user click or not. But we feel we can innovate in that space. They’re hard problems, but they’re kinds of things we like to work on.

In the old world, people used to have to go to focus groups and ask people what they thought. Now, people are writing all over the Web what they think about things. So how do we capture that and help them understand what other things they should focus on? And how do you create ads that are really beautiful and engaging and the users love them and want to see them?

Q: People always ask, “What’s the last display ad you remember?” Banner ads are still seen as something most people ignore.

A: Things are starting to change. Like Burberry Kisses , or the Samsung ad or the Dove ad , or the Red Bull ad . These are really dynamic, and they’re really timely. They’re in the moment, and people are able to take advantage of that.

The other thing I’m thinking about is how to give users more control. I want users to say, “I want to see more ads like this” or “I don’t want to see more ads like that.” We haven’t really had the capability to do that. We’ve come out with all these things–brand surveys , Active View.

But we’re early. These are all things that came out in the last six months. So they need to be tested. Brand advertisers are not going to switch all their dollars over on something that we just released this month. They’re going to test it and test it and then as they understand it and it gets more adopted as an industry standard, they’ll start moving more and more dollars over. But it’s going to happen.

Q: It’s also not clear yet what’s going to work among all these products, what’s going to drive people to store shelves, right?

A: We see some things that worked. But it’s also a different medium. The Red Bull campaign, the Samsung live streaming, these aren’t things that would have happened on TV. So just like it didn’t work to just take a radio ad and put it on TV, they had to change the creatives. It’s the same online. The creatives have to be dynamic and interactive and timely.

Like when you’re visiting a hotel, why aren’t you getting offers for things right nearby? Your phone should know where you are.

We’re just really early, and that’s what keeps me engaged. I can see it will come. I have that vision. I have the blueprint of where I want it to go. I just know there are a lot of steps we need to take to get there.

But when we do, it will be significant.

Susan Wojcicki

Source: Forbes


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