Connect with us

Marketing

Could Google’s Virtual Assistant Shake Up the Advertising Industry?

Published

Could Google's Virtual Assistant Shake Up the Advertising Industry?

The manic cries continue to reverberate: SEO is dead!
 

Up until now, it has all merely been sensationalized clickbait. But there is a big change on the horizon that could see all this yammer actualized.

Earlier this year at Google’s I/O developer’s conference, the company unveiled its latest technological offerings; a new virtual assistant and an Amazon Echo inspired home device simply called Google Home.

The virtual assistant is an upgraded version of Google Now which incorporates user profiles, locations, and other details in combination with its already robust knowledge base. This aims to provide users with voice results on a wide array of queries that can even be tied into questions about where a person is standing the physical world. Google Home features the same AI and allows users to essentially interact with the search engine without ever touching a device or looking at a screen.

The perplexing part about this, however, is that these new contributions by Google are completely counterintuitive to their already prosperous business model. By allowing users to access the search giant in a hands-free and screen-less manner, the company is effectively eliminating a large portion of its main source of revenue: ads.

As it stands, Google is the internet’s leading place to advertise anything and everything; Alphabet, Google’s parent company, received 88% of its $75 billion in revenue in 2015 for ad sales.

As these technologies become more commonplace in modern homes, Google will be forced to rethink its business structure as technologies and devices such as the ones they themselves are offering could bring the demise of text-based ads; and Google seems to be aware of this.

The search engine’s CEO, Sundar Pichai, has noted the company’s, “. . . investments in machine learning and artificial intelligence are a priority for us,” and that Google is “. . . thoughtfully applying it across all our products, be it search, ads, YouTube, or Play.” So according to these statements, the organization as a whole is seeking to integrate these types of advancements into all of its products.

But it isn’t just Google that is endangering its own wellbeing with the potential eradication of AdWords. The ubiquity and capabilities of smartphone devices have led people to spend more time in-app than on web browsers. Additionally, nearly every social media platform has gotten into the advertising game, effectively doing something that Google can’t; circumvent ad blockers which are growing in popularity. And social media offers a much wider array of diverse and compelling ads than Google. Because of these factors, Facebook alone is already pulling in a quarter of the revenue from ads that Google does.

So this leaves two very significant questions to be asked when all of this is considered:

  • Is Google intentionally trying to kill text-based ads as it loses ground to creative social media ads?
  • Where will Google pull its revenue from if AdWords dies?

##TRENDING##

While we may never have a concrete answer to the first question, it does seem that Google is, at the very least, playing a contributing role to the death of ads on search engines. As for the second question, if personal assistants and home-based devices do become anywhere near as ubiquitous as smartphones, Google could theoretically abandon its ad-based business model and instead opt to charge businesses that it effectively connects users to. For instance, if someone wants to order a pizza from Domino’s, the company could charge a flat fee or take a portion of that sale. If this is the case, Google’s new model could potentially be even more profitable that its current one. Especially when you considered that more than 78% of mobile searchers are seeking local solutions which most times result in a purchase.

In all actuality, business models have yet to emerge in this arena making the future of Google’s cash flow very murky. What is clear, however, is that at some point in the near future search engines will no longer be accessed the way they are now; typing in queries will be an outdated modality. This leaves search engines no choice but to evolve with the times.

Continue Reading

Trending