Google: Display Ads For Consumer Package Goods Are On The Rise

Online display ads for Consumer Package Goods (CPG)  are in greater use than ever.  Not only did we spot this trend late last year, but now that the 1Q numbers for '10 are in, it looks like consumer package goods marketers have discovered the joys of effective display advertising in even greater numbers than we suspected.

CPG has company too: giant entertainment companies have jumped into display with both feet - at least according to Google.  And as we know, Google is traditionally behind other players in display, making the industry-wide potentials for display ad growth very juicy.  As reported in Clickz:

Large entertainment and packaged goods companies were among those to boost their spending on Google's ad network, CFO Patrick Pichette said during the company's quarterly earnings call. "Large advertisers have come back," he said.

The return of big budgets goes back to at least Q4, when CEO Eric Schmidt called display advertising "the next huge business for us."

Google's Q1 revenue grew 23 percent compared with the 2009 period, driven in part by a 15 percent year-over-year increase in "aggregate paid clicks" - a term that refers to the total number of ad clicks on both Google-owned properties and partner sites. Additionally, the company enjoyed an average cost-per-click (CPC) that was 7 percent higher globally than in Q1 2009. Performance was strong across all major product areas, including search, display, and enterprise.

Google has been true to its promise - voiced a year ago - that it would ramp up hiring and M&A activity. The acquisition spree that kicked off last fall with the purchase of Teracent continued this year with the buys of video platform Episodic and British startup Plink, among other firms. (Google's proposed acquisition of AdMob remains in regulatory limbo.) The company is now queuing up additional M&A activity, Pichette said.

Google said it added 786 employees during the quarter, bringing its headcount to nearly 21,000. Pichette said the company remains focused on hiring talented people in ad sales and engineering.

Google's growth into display is almost certainly going to continue, and the great thing is they're reaching for a piece of an expanding pie.  For a long time, there will be plenty of room for players and platforms in this space, and we can all point to Google as a gauge of the market's future health.  It's a great time to be involved in online display.