Sridhar Ramaswamy is one of the top Indian techies running the show at Google. As Senior Vice President of Ads & Commerce, Ramaswamy controls Google’s $60-billion advertising business. Having joined the internet giant in 2003, he has been responsible for developing Google’s digital ad platform. The climb up has been tough for the IIT Madras alumni, with many internal battles and swift changes in the external internet ecosystem.

Today, Ramaswamy is considered to be among the few people who are shaping the future of global internet commerce. cat.a.lyst met him recently at Google’s headquarters at Mountain View to have a conversation about his vision for the future and trends in the digital advertising space. Edited excerpts:

Internet usage is quickly shifting from desktop to mobile devices. What is your game plan for keeping Google’s advertising revenue market share from sliding down further?

Clearly we recognise that this shift to mobile devices is a phenomenon in multiple countries, although it has taken different paths. In European countries, for example, the shift has been gradual, from desktops to laptops to tablets and smartphones. In countries like India, where desktop penetration is low, there is a more direct shift towards mobile.

When it comes to the internet, our mission is to make information accessible to everyone. Once access is available, the basic intent is to find out something — most people say they are going to search for it. That need has not gone away even on mobile, so search continues to thrive. We have a lot of work to do in this regard but we  constantly push on things like enabling voice search, how to make it easier to type on a mobile phone and other innovations. Search advertising, even though it works differently on mobile, continues to be a big part of who we are as a company. 

As far as our products are concerned, my focus is on things like ‘mobile local’, which is around how mobile drives mobile commerce. We are also heavily invested in the apps business where we have launched products like search ads on Play. The thing that we love about search is that AdWords makes it possible for everyone to take out an advertisement on any keyword and compete with any company. We think it will bring that kind of access to lots of developers. Driven by YouTube, we see healthy growth in video advertising. So these are our three pillars. The fourth pillar we are working on is programmatic advertising —  how do you make all manual driven, email driven transactions for buying content, how do we bring software to them like the Doubleclick Bid Manager which is being used by a lot of companies. These are areas we think will impact the future.

Google’s advertising revenues have so far come from web-based search. Are you worried about the emergence of mobile applications, which is taking users away from web search, at least in niche areas such as ticket-booking or hotel search?

It is really important for any company, especially internet tech companies, to embrace the future. When there are sea changes we embrace them. For example, we bought Admob very, very early. Recently, we launched search ads on Google Play which should have been done some time ago but I am glad it is out there. For app discovery, we now have deep linking where we can open the pages directly inside the app and that will keep Google relevant. If there are multiple ways to do things then there is power in somebody providing you right access point at right time when you want, so that’s the intermediary role we play. The role will change over time, the model today will not be the same for tomorrow.

The apps versus web debate has not seen the final answer. Apps are great except you have to wait for three minutes to download them on your phone. Then once you have 100 apps on your phone it’s hard for you to keep it organised. So what is a better model? One that combines the best of web — which gives access to millions and interoperability — with the convenient features of an app. Over the next five to ten years things will be rewritten. I see my role as adapting to the changes that come along.

You have been talking about ‘Micro Moments’ where users look for specific information before deciding to buy a product. How has this changed the way advertisers and brands approach the digital media?

We created this narrative to emphasise the critical role Google and advertisers have to play in fulfilling consumer needs. I also tell big advertisers it is more than advertising. It’s addressing critical needs. It’s about what people want to do, something as simple as how to change a battery.  Consumers are actively looking for information and it is important for advertisers to be present at that moment. Sometimes they can do so through a commercial message, but many times it has to be done through giving right information. And the more presence you have across both of these, the stronger the connection to your brands.

For example, if you are making beauty care products, you need to make available authoritative information on how do I deal with my oily skin. You may not be that relevant if you don’t make that information available online. Our thesis behind the Micro Moments narrative is that mobile is driving these moments, they are happening all the time driven by strong consumer need and brands need to be there in these moments to shape people’s preferences and choices. This is something that is resonating with the advertising community.

So we tell them to put themselves in consumers’ minds and make a list of what they are looking for. These are the micro moments related to your brand. Now think about how you are addressing all of these needs — some of which will be how to purchase products but be aware of the larger need that they have and make sure you are available to your consumers.  Whether it is through search or YouTube, the key thing is how to be relevant to your consumers.

How has measurement of digital advertising evolved?

In e-commerce, conversion tracking and return on investment is easy and has therefore become a science — as opposed to TV advertising where you do complicated geo studies and yet have no real conclusions. What we are working on is to bring the same level of science and quick feedback, like in e-commerce, to search and YouTube advertising. We can now measure, using a product called Brandlift, how many people saw an advertisement and whether that led to an increase in search for keywords related to that product. We are developing new metrics to connect offline and online behaviour — for example, if you saw an online advertisement and if it actually led to a sale through an offline store. We have a product called store visits which can give that statistics. You can create amazing algorithm and optimise the advertising spend automatically.

But how can Google assure advertisers actual sales when the final decision to buy a product is in the hands of the consumers, which is dependent on a number of factors, such as quality of the product?

This is where you get into models such as the attribution model. We have ways to determine relative multiple events that led to actual sale. You saw YouTube video and then clicked on the advertiser site and came back. Then you clicked on another search ad and went to the site and this time bought the product. We can come up with a model which gives piece-wise assignment of credit.

There have been reports that Google charges its advertisers even for fraudulent clicks from bots. How do you counter this?

We have taken serious measures against fraudulent practices for the last 15 years. These span the spectrum from people who click on competitors ads to increase their ad spend, to running sophisticated bots to generate fraudulent revenues. AdEx is one of the cleanest exchanges in bringing quality advertisers. However, we are talking to the researchers who have brought out this report. We don’t think this is a pattern but we are always willing to learn. At the end of the day it’s our credibility at stake and we have put best researchers on the job that obsesses about this day in out.

Regulators around the world, including in India, have raised concerns about alleged manipulation by Google on its advertising platform that tends towards anti-competitive practice. How do you respond to such criticism?

I think we live in a world that’s incredibly competitive. It’s good for consumers. Just over the last five years you have seen the rise of companies such as Amazon. Flipkart and Snapdeal. You can think of them of being in a space where we want to be. Sometimes people mistake change for malicious intent. The digital ad space is continuously evolving. Core Google experience is a living, breathing thing. We are working with regulators, talking to them and illustrating the fact that there is active competition and at the same time stressing for product to evolve. The final chapter is yet to be written on this.

How do you view the new trend of ad blocking tools? Some say it is good as it allows users to opt in to receive ads.

Google as a company exists and provides services such as search and YouTube because we are ad-supported. It is something we are proud of. We are not for the elite. We know millions of sites, including newspapers, that are ad-supported. Most media want to offer a fair voice to the people and they are mostly ad-supported. The problem with ad blockers is that they are indiscriminate in blocking all ads. In my opinion, there is a small set of not so great players that is poisoning the well. It is important for the digital industry to take a hard look at itself and think of what an acceptable ads programme should be. It is time for us to be proactive to talk about this instead of ignoring because that leads to the rise of ad blockers who indiscriminately punish every publisher, including Google, and papers such as the New York Times and The Hindu . This is the real problem.  

See Page 4 for more on ad blockers

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