Transcript The Rise of Internet Advertising Nick Maggio

The Rise of Internet Advertising
Nick Maggio
Bill Gross
• The mastermind behind the pay-per-click
advertising
• First company was Gross National Product
• Started another company IdeaLab
• IdeaLab then generated many
more companies.
Start of the Advertising
• The rise of the internet took off gradually in
the mid 90’s
• Advertising starting to become more popular
on the internet.
• Companies would pay tons of money for the
outright advertising rights on a website.
• CDNow spent 18.5 million on rights with Lycos
• Preview Travel spent 15 million on Excite
Good idea
• Gross noticed that there was a significant
difference in traffic between good and
undifferentiated.
• Good- traffic that converted paying customers
• Undifferentiated- people who arrived at the
site via spam or poor search engine results.
• Gross devised the plan to charge advertisers 5
to 10 cents per click
GoTo.com
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Created in 1997
It created a new model for the web
Started the internet advertising per click.
His vision was to have a search engine be able
to have interested searchers
• He first started charging 1 cent per click, which
he knew was well below what it was worth
and what people would pay for it.
Overture
• In September of 2001, GoTo.com changed their
name to Overture
• Their mission was to be the liaison between a
company and their advertising per click.
• In 2001 Gross met with Page and Brin to discuss a
possible ultimate merger, but the Google guys
refused because they would never be associtated
with a company who used a combination of paid
ads and search results.
AdWords
• In 2002, Google came out with their own
version of the pay per click, AdWords.
• Overture sued Google for patent
infringement.
• They settled outside of court for
approximately 2.7 million shares of stock
which is about 290 million dollars.
• Overture was sold to Yahoo for 1.63 billion.
The aftermath
• Although Gross sold his company for less than
what he could have gotten for it, he is one of
the internets best innovators.
• Google benefitted greatly from his idea.
• His contributions are great and he continues
to look for the next new idea.
Snap
• Snap.com
• This is Bill Gross’ new and latest idea.
• He claims it is the solution to the search
engine spam problem.
• His only motivation is Google.
• One interesting fact is that he uses a program
that lets you preview the link.