Google Displaces Yahoo in Display Ads, AdMob Buoys Mobile

Google is king of the hill in display ads, taking the mantle from Yahoo for the first time. The search engine also celebrated its one-year anniversary of buying AdMob May 27.

Google (NASDAQ:GOOG) reached several advertising milestones through the month of May, including passing Yahoo (NASDAQ:YHOO) for the first time in display advertising.

Google's U.S. display ad revenue share grew to 14.7 percent in the first quarter 2011 from 13.3 percent from the fourth quarter 2010. Yahoo's display ad share fell to 12.3 percent from 13.6 percent in the prior quarter.

IDC analyst Karsten Weide attributed the growth to an increase in display ad spending on Google's Display Network by small and midsize businesses.

Many of these companies were already using Google for search ads, and added display to the mix, signaling an uptick in ad spend. IDC said U.S. spending increased by 14.2 percent from $7.1 billion in Q1 2010 to $8.1 billion in Q1 2011.

Weide expects Google's Display Network to put more pressure on display ad publishers Yahoo, Microsoft (NASDAQ:MSFT) and AOL.

"GDN for now does not threaten them directly since their primary client base are brand advertisers, while the GDN for now mostly attracts SMBs," Weide wrote. "But that may change, and when that happens, the old stalwarts' lumbering sales organizations will have to compete with GDN's ultra-effective automated sales interface."

Weide also expects Facebook to threaten both traditional publishers and Google, noting that while Facebook's revenue is still relatively small, it is growing fast and attracting major brand advertisers. 

comScore was even more bullish on the social network, claiming Facebookracked up 346 billion display ad impressions for Q1, pacing the field with 31.2 percent of the 1.1 trillion display ads served in the United States.

Meanwhile, IDC said Google's U.S. search ad market share rose to 59.6 percent Q1 2011,up from 59.1 percent in Q4 2010. On the strength of Bing, Microsoft notched up to 7.9 percent from 7 percent in Q4. Yahoo lost a full percentage point, achieving 7 percent search ad share.

While Google continues to dominate in search ads, and has just nosed into the No. 1 position in display, the company is posting equally impressive gains in mobile ads.

Google acquired mobile ad maker AdMob one year ago. Since that time, 300 million smartphones shipped, average smartphone data-usage doubled and hundreds of thousands of new mobile apps have been created, according toGoogle's calculations.

Since joining Google, traffic on AdMob's network, which comprises 80,000 mobile apps and Websites, has grown more than three and a half times. The network also now lodges more than 2.7 billion ad requests each day.

To celebrate its one year anniversary of joining Google, AdMob also rolled out new rich media ad formats for tablet computers; a refreshed AdMob House Ads product developers use to promote their own products within their mobile apps; and mobile support for Google's DoubleClick for Publishers (DFP) small business ad product.

http://www.eweek.com/c/a/Mobile-and-Wireless/Google-Displaces-Yahoo-in-Display-Ads-AdMob-Buoys-Mobile-455304/