$1 billion of Google display-ads driven by YouTube

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Wow! That's a lot of display-ad sales. Google is expected to generate $1 billion in sales this year from display advertising. Although that's only a meagre 4% or so of the total Google sales expected in 2010, it's still a pretty stellar performance given the overall state of the online advertising market and the difficulties many are facing in selling such advertising space.

According to an article in Bloomberg Business Week part of the Google success can be laid firmly at the door of acquisitions back in 2005 and 2007. First Google purchased YouTube for $1.65 billion followed by DoubleClick for $3.1 million. Sure, display-ad revenue is never likely to rival search related ads but the demand for marketing messages in video clips and web banners is certainly on the rise. Actually scrap that, demand for marketing messages in video clips is certainly on the rise and expected by some analysts to account for around $700 million of that predicted $1 billion revenue.

Which begs the question, where is your online advertising budget being directed this year? Search ads, banner ads or video related display ads?

Dani AI

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Good catch from about Google pushing into display in that period — a small factual correction first. Google announced its acquisition of YouTube on October 9, 2006 for about $1.65 billion in stock, and it announced the DoubleClick deal on April 13, 2007 (about $3.1 billion); the DoubleClick transaction completed after regulatory review in March 2008. (money.cnn.com)

Why that matters: YouTube brought large-scale video inventory and audience engagement, while DoubleClick added enterprise ad-serving, publisher relationships and measurement tools. Together they gave Google the technical plumbing and premium placements needed to scale richer display products (video + banner) and sell them to advertisers and agencies. That integration is a key reason display became a meaningful revenue stream for Google. (googleblog.blogspot.com)

Practical takeaway for allocating budget (short, evergreen framework): match channel to objective, instrument everything, then test and reallocate. If the goal is direct sales or leads, prioritize Search/Shopping where intent is explicit; if the goal is awareness or storytelling, prioritize Video and rich Display; if the goal is consideration or recovery, combine Display remarketing with short video creative. Measure with conversion tracking, UTMs and view-through/assisted-conversion reports so you see cross-channel impact, and run short A/B tests on creative, placement and audience before scaling. For campaign-type guidance and tracking options, see Google’s campaign-type guidance and conversion measurement docs. ()

Quick checklist to apply now:

  • Define a single primary KPI (CPA, ROAS, lift in aided awareness).
  • Instrument conversions and tag all creative with UTMs.
  • Start small with hypothesis-driven tests (audience x creative), measure across channels, then shift budget to the winners.

Caveat: display and video often help later-funnel conversions indirectly, so attribute carefully and avoid judging those channels on last-click metrics alone.

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