@ IAB: Google's Rosenblatt: How Delivering Display Ads Is Like Distributing Japanese Toilet Paper

imageWhile it seems strange to have someone from search giant Google (NSDQ: GOOG) brought on to defend display, David Rosenblatt, president, Display Advertising for Google, did have some positive things to say about that format. But mainly, it was a pitch for his company’s approach to saving that marketplace.

Japanese toilet paper: If you don’t grow demand as inventory piles up, it’s hard to maintain prices, Rosenblatt said, adding that that is no ultimate judgment on the underlying value of the media display ads support. “It’s hard to buy when their are over 1- to 2 million publishers. It spawns a huge number of vendors and third-party specialists, for reporting, optimization and workflow. Each one of these companies brings its own methods, staffs and costs. It reminds me of a joke about the Japanese distribution system: it takes 15 companies to put a roll of toilet paper in a consumer’s hands.

Google’s approach: The ad exchange extends the AdSense marketplace. It’s neutral and will support all formats, not just text, which has been Google’s mainstay. Not just the auction method, but reservations-based buying. We launched a new design tool for display ads in October. “What we found was that 80 percent of those who used that program never bought display before.”

Don’t bash technology: Rosenblatt began his talk alluding to MSLO co-CEO Wenda Harris Millard’s warning at the conference on Sunday that science had eclipsed art in the online ad business. He argued that it was a false dichotomy to say you have to choose between the two or that technology shouldn’t direct the art an advertiser uses in crafting a message.

Google loves agencies: Addressing the “frenemy/froe” issue in its sometimes wary view from ad agencies, Roseblatt insisted that “Google loves agencies; we work with them all and they understand brands better than anyone.” But, because Google is extremely focused on efficiency, Roseblatt’s argument went, agencies often misinterpret that rigor as a threat to their model. Secondly, Google isn’t interested in commoditizing media. “We manage tens of billions of display ads and our monetization efforts have been devised in concert with our publisher partners. That allows publishers to realize the highest yield possible. And one small point, last year, we wrote $6 billion in checks to publisher partners.