Google to Sell Banners, Skyscrapers, Buttons

Rhett Pardon
MOUNTAIN VIEW, Calif. – It’s about time.

Search engine Google Inc. is moving beyond itsy-bitsy text ads to banners, buttons and skyscrapers.

The Mountain View, Calif.-based company, which is nearing an initial public offering that may be worth $25 billion, has begun selling ads that include images on a test basis to beef up revenue.

For now, the advertisements will appear only on other websites, where the search engine firm acts as a quasi-advertising agency, selling small text ads related to the content.

The director of product management told Dow Jones Newswires that Google is weighing whether to add the larger-size ads to its main website, where nearly all of its revenue comes from.

Industry analysts on Thursday were surprised of the news.

CNET's News.com called the move a "surprise reversal for a company that has won regard for its pioneering use of text-only marketing pitches."

Google is following Sunnyvale, Calif.-based Yahoo Inc.’s strategy of selling similar keyword-related text ads on other companies' sites. Its Pasadena, Calif.-based Overture unit allows advertisers to include graphics with text in a small box, but doesn't offer the larger-image ad formats Google is unveiling.

Google’s strategy has the image ads linked to keywords chosen by advertisers and placed on pages where those keywords appear. Its clients will bid for the placements the way they do for text ads, by agreeing to pay Google and the site operator each time a user clicks on the ad.

The move puts advertising network providers ValueClick and 24/7 Real Media in direct competition with Google.