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Google Campaign to Build Up Its Display Ads

Google, the online search ad giant that rarely advertises, has decided it needs to advertise the fact that it is in the online display advertising business.

And if that is not enough advertising about advertising, it has picked one of the most crowded advertising venues to get the message out — Times Square.

For all of Google’s success, its business has been built on search ads, the simple four-line text ads that appear with search results. Google does not get as much attention for its display ads, which include images, video and audio, even though those ads appear on YouTube and the million Web sites using Google’s display ad network.

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Google

That is the source of growing frustration at Google, which does not want to be seen as dependent on search ads.

On Wednesday, Google will erect a billboard in the center of Manhattan that will vie for attention with the hordes of other flashy billboards. But it will stand low to the ground and invite passers-by to touch it and watch videos about the display ad business.

The billboard has a message for both Madison Avenue and Wall Street: Google has a business beyond search ads. More than 90 percent of Google’s revenue comes from text ads, and analysts say that Google’s stock is down about 17 percent this year because investors are waiting for the company’s second act.

The billboard is part of Google’s broader ad campaign called Watch This Space, which includes ads in trade magazines and other print and online media, to inform the advertising industry and investors of Google’s online display ads.

“In its core business, competition is going up and growth is going down, so that is why it is very important for Google to basically diversify beyond search,” said Sandeep Aggarwal, senior Internet and software analyst at Caris & Company.

Google is also playing offense, trying to get a piece of a market that has lots of room to grow even though display ads have been around for more than a decade, first as pop-up and banner ads, and now as ads of different sizes that mix images, text, audio, video and animation. (Google also counts text ads that appear on Web sites other than search results pages as display ads.) Brand advertisements like these make up two-thirds of the total advertising market but just one-third of the online ad market, Mr. Aggarwal said.

“One of the ways we could express our confidence in the space is to run what is primarily a display advertising campaign around our investment in the business and what our potential is,” said Neal Mohan, the vice president of product management responsible for Google’s display advertising products.

Google was slow to embrace display ads because it was so strong in search advertising, Mr. Aggarwal said. Search ads seek an immediate response in the form of a click, while display ads seek something mushier: brand awareness and loyalty.

The Times Square billboard, which will be 35 feet wide and 13 feet tall and stand 3 feet off the ground, will show a Web page with the words “Display ads are big. They’re gonna be huge.” Below the tag line, “Watch this space,” an arrow points to an empty space where a display ad could be.

People can touch the billboard’s screen to view videos about Google’s display ad business, all in Google’s logo palette of red, yellow, blue and green. It will be erected on Broadway at 48th Street on Wednesday, near the venue for the Interactive Advertising Bureau’s digital ad conference next week.

In the videos, Google makes the case that even though it is late to the display game, it is trying to improve a stagnant business.

In the last few quarters, display advertising has become one of Google’s fastest-growing businesses, as advertisers including Ford, Kodak and Armani have embraced it.

Ninety-nine percent of Google’s 1,000 largest advertisers run campaigns on the Google Display Network, which includes Web sites like MarketWatch, Rolling Stone and the Food Network, up from just a few several years ago, Mr. Mohan said. The largest advertisers have increased their spending on the network 75 percent in the last year.

The ads are more creative than pesky banner and pop-up ads, said Barry Salzman, managing director of media and platforms at Google who runs sales for the display business in the Americas. They include mobile ads, expandable ads and ads that function as mini-Web sites with slide shows and interactive features, he said. Still, about 60 percent of the nonsearch display ads that Google shows today are plain text.

Google has also been acquiring companies to build its display business. YouTube is the host of many Google display ads, and DoubleClick provides tools for advertisers and publishers to show the ads. Teracent lets advertisers tailor ads on the fly, depending on things like the type of publication, the reader’s location or even the weather. And Invite Media is an exchange where advertisers can bid on display ad space.

Google is employing new technology that makes it easier to plan campaigns, change the ads based on things like location and measure how many people see them, the company says. It is experimenting with new kinds of ads, like those that follow users who viewed hotels in Paris on one site so they see ads for those hotels on other sites, a technique called remarketing.

Google is also trying to make display ad campaigns easier for small businesses to buy with the Display Ad Builder, a tool that lets them plan the creative and logistical elements themselves. A hundred new advertisers, most of them small businesses that have never run display ads, use the tool each day, Mr. Mohan said.

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