If Online Advertising is Growing at Double Digits, Why Are AdSense Publishers Complaining?
Have you ever noticed that Google’s AdSense program doesn’t seem to be promoted much?  Don’t you think it’s odd for a company known for it’s strategic planning and foresight to let the AdSense  program run quietly without much promotion?  I appreciate the effort on updating the publisher interface and holding the AdSense in your city events, but what I would really appreciate is a stronger effort to promote the program to advertisers. Every year it is reported that advertising spending online is growing at double digit rates.  So why are web publishers reporting double digit declines in advertising revenues?

It’s not for lack of money in the marketplace. The amount of advertising money flowing to offline outlets dwarfs what is spent online.  A good amount of that offline spending could be diverted to reasonably priced and more effective advertising online. For example, in 2010 advertisers spent $59 billion dollars on television advertising. Online advertising only amounted to $26 billion dollars. There is a lot of advertising money that could be redirected online, including to the AdSense network. So why isn’t Google going after it on behalf of it’s AdSense Publisher partners?

According to Google’s 2010 Fiscal Year earnings report, Google owned sites grew at a rate of 28% over the previous year, while the partner sites grew by 22%. While 22% growth is great, that growth must have been absorbed by a greater number of publishers because most publishers are not reporting growth in earnings. Many publishers are reporting the opposite, a decline in earnings. AdSense Network publishers have inventory and the capacity to handle more advertisers. But apparently Google is not doing anything to bring more advertisers to the network.  According to and AdSense competitor Adam Griffin of Lijit Networks (recently acquired by Federated Media):

I think online ad spend is a long way from its peak. We are just skimming the surface with mobile and video and there are a ton of new opportunities to work with publishers on creative, conversational campaigns. This, coupled with the continued transition from traditional media to the online world, makes me believe we have a lot of bright days ahead in this industry.

Why Maintain a Publisher Network and Underpromote it?
What is the value to Google of a publisher network that is not adequately monetized? Is Google missing an opportunity? Or is this a strategy? Here are two reasons why Google may be executing on a plan to use AdSense as a hedge against rival advertising networks in order to help it grow the more profitable search part of the business, at the expense of the publisher network:

 1. AdSense keeps website ad inventory out of the hands of rivals.

2. The publisher network is a competitor to Google’s search network.  The AdSense network allows Google to control available ad space, while enabling Google to keep feeding the more profitable search network.

It could be argued that Google is understands that promoting the publishing network will poach revenues from their more lucrative search network. But a counter argument is that the goals of display advertisers and advertisers on search are different and the crossover would be neglible.  Growing the publisher network does not necessarily mean shrinking the search network. AdSense publishers want access to the Fords and Cokes of the world instead of slumming it with the fat belly ads.

Why did Google Pull the Plug on Publisher Outreach?
Since pulling the plug on AdSense Advisor (also known as ASA), some webmasters have taken it  as yet another sign of Google’s lack of publisher support.  Whether it’s a misstep or part of a strategy to eventually shrug off AdSense, one thing is certain. It leaves the door open for competitors to gain an entrance.  About the AdSense program, Adam Griffin, of Lijit Networks offers,

The biggest downside is the lack of a human connection. When something goes wrong, or you have a quick question, you want to be able to get another human being on the phone or over email. AdSense, in a lot of ways, is a faceless platform. At Lijit, publishers are our people. We’re working with them day in and day out to provide the best experience possible, and giving them the best tools out there to successfully operate their site.

How many webmasters would love to hear that from Google? Alternatives to AdSense have been receiving start up money and the networks are growing. There is a significant amount of growth left in online advertising by well funded companies that are signing up quality advertisers, while also wooing the cream of the publishers with websites in attractive niches.

These companies are chasing the advertising clients that Google will not or can not bring to the content network. Keeping advertisers spending on search is more lucrative than sharing the advertising money on the content network. I can understand the financial conflicts of interest. But this ends up being a situation in which it appears that Google is treating their partners as competitors. But because of the differences in the needs of display advertising versus search advertising, it’s clear that Web publishers are not competitors… until Google enters their space with Google content .

Publishers come to Google because they expect Google to produce advertisers. Google accepts the publishers because they produce the context for advertising. But in recent years the quality of the AdSense program has changed. Some say it’s because there is too much inventory. That’s possible. Many webmasters have discovered they are better off selling their ad inventory directly to advertisers.

Is the AdSense program still delivering for you? Are you satisfied with Google’s publisher support? Is Google treating AdSense publishers as competitors?

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