Case | HBS Case Collection | October 2006 (Revised October 2007)

Google Advertising

by Youngme E. Moon and David Chen

Abstract

In mid-2006, Google is the number one search engine in America with 99% of its revenues deriving from its simple, text-only advertising services. It is on track to bring in roughly $9.5 billion in advertising revenue in 2006, which would place it fourth among American media companies in total ad sales, ahead of giants such as NBC Universal and Time Warner. However, it has also begun to explore new ways to expand its online advertising model, experimenting with more elaborate forms of advertising (involving graphics, animation, and video). Google has also begun exploring the radio/television advertising space. Each of these forays is raising a number of key questions for Google, including whether it is possible to reconcile these advertising formats with its current business philosophy.

Keywords: Online Advertising; Disruptive Innovation; Media; Expansion; Search Technology; Advertising Industry; United States;

Citation:

Moon, Youngme E., and David Chen. "Google Advertising." Harvard Business School Case 507-038, October 2006. (Revised October 2007.)