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Google Advertisers Like GMail, But Want Lower Rates

Google Advertisers Like GMail, But Want Lower Rates

According to survey results released today by Mosaic Media, 57.1 percent of Google AdWords advertisers want their ads to appear contextually in Google’s Gmail. Gmail is Google’s free e-mail service that is currently in beta testing and is expected to go into full release this summer.

Google intends to place contextual advertising in personal e-mails, so if someone is talking about taking a trip to Vermont, hotel ads may show up alongside the text. In Mosaic Media’s survey, only 19 percent of Google advertisers gave a flat no to the concept of their ads appearing in personal Gmail correspondence.

The survey revealed, however, that advertisers don’t want to pay as much for Gmail ads as they pay for ads that appear alongside search results. Only 30 percent said they are willing to pay the same cost-per-click (CPC) as they pay for search-results ads. A full 50 percent said no to idea of paying the same rate as search ads. But if the rates are lower for Gmail, advertisers like the idea. Sixty nine percent say they would try Gmail at a lower CPC. And like good direct marketers, 69 percent would design a separate campaign for Gmail.

Most of the respondents are active Google advertisers. A small percentage of respondents are not currently Google advertisers but plan to launch a Google campaign in the near future. The bulk of the respondents, 46.2 percent, sell goods or services to both consumers and businesses. Thirty one percent were business-to-consumer only, while 18 percent conduct business-to-business trade only.

Google announced the beta testing of Gmail on April 1. The announcement was followed by a storm of controversy about whether the placement of contextual ads in personal e-mails constitutes an intrusion on privacy. Some claim that when you receive something for free, privacy violations don’t count. Some survey respondents were queasy about the privacy implications, with one advertiser saying, “The negative fallout from the invasiveness of this type of advertising is dangerous.” Other respondents characterized Gmail as a misstep for Google. “It’s like ads on eggs. Who needs them?”

Most respondents expressed an interest in trying Gmail as long as the costs were not equal to search engine ad rates. “It sounds very targeted to me,” said one respondent. Another noted that an ad that appears in search results is more valuable since the searcher is seeking results. “Gmail should be less expensive since it’s not like a search in which information is being requested.”

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Loren Baker

Loren Baker is the Founder of SEJ, an Advisor at Alpha Brand Media and runs Foundation Digital, a digital marketing ... [Read full bio]

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