Google Confidential and Proprietary 2

Sophie JonesIndustry Manager, Google UK

Speeding up in the Slowdown

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Search is an integral part of customers’ lives…

57% of people would refuse to give up their broadband - higher even than fresh fruit and vegetables!

..and a barometer of consumer behaviour

So what are we seeing?

What we’re seeing…

Fast rising searches

‘Free delivery’

‘Discount vouchers’

‘New dvd releases’

‘Safe savings’

‘Cheap loans’

‘Pay off mortgage’

‘Afternoon tea’

Online shopping spend up 14.2% to £4.67bn

Dec 08

M&S's online sales up 29%

13 weeks to Dec 08Debenhams Direct,

sales up 37.4% YTD

36% of internet users plan to do more

shopping online & less on high street in 09

It is convenient…

68% think shopping online is cheaper because they don't have to pay for

parking, petrol or transport.

…and delivers value

89% think they can find a better deal online than on

the high street

Searches for discount vouchers up 133% last

year

Source: Google Insights for Search, Hitwise. TNS. Jan 2009, NMA reported results of their survey into consumer shopping habits.

“Online shopping growth continues to outperform the high street, as tight budgets and poor weather keep people at home where they

can shop online for bargains” - James Roper, IMRG

This time is different

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Online is mass market

Sources: Forrester’s European Consumer Technology Adoption Study Q2 07, internetworldstats.com June 08, Ofcom Nations and Regions CMR 2008

90% Must have broadband

8 hoursSpent online per week

70%UK pop go online

regularly

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Bargain hunters don’t drive

80% of internet users compare prices and options

3/4 shoppers compare prices online before visiting the lowest price store

30% more actively seeking promotions than last year

18% buy weekly groceries online

Sources: Harris Interactive “Digital Influence Index”, Jun 2008; The Retail Bulletin, “Consumers seek out promotions than they were 12 months ago, Jun 2008; Internet Retailing “I want to buy some cheese”, Feb 2008; IMRG Cpagenini e-Retail Sales Index, Jul 2008]

81%of internet users enter websites via a search engine

Source: Forrester Research Inc., “UK Internet User Monitor”

Search is the gateway

Search enables discovery of new brands

Source: TNS / Google Automotive consumer study June 2007; Base: All respondents who bought a new car% - Completely Agree - Agree

47%

64%

64%

61%

48%

44%

Find the best price

Make more informed decisions

Compare makes and models

Discover new and relevant websites

Discover new models

Discover new brands

Automotive Example: Search engines help me

Consumers search through the purchase process

Distribution of searches prior to purchase

1 2 3 4 5 6 7 8 9 10 11-20 21-30 31-40 41-50 >50

12 travel searches

29 days

22 travel sites

Before a first transaction, on average:

100%

90%

80%

70%

60%

50%

40%

30%

20%

10%

0%

Number of Searches

Source: Comscore Research Paper October 2007

Google Confidential and ProprietarySource: comScore, US, CPG study, October 2007Jupiter Research / Ipsos Insight Consumer Survey, n=2.103 (Search Engine users US only), Jan 2008

Consumers associate search ranking with the success of the company

of users link placement to company prominence

of users expect leading brands to be on top of the search results page 71%

36%

FMCGExample

Google Confidential and Proprietary

of top brand owners don't bid on their own trademarks

Source: Harvest Digital Report “Trademark bidding on Google”, July 2008

Brand owners do not bid on their own trademarks

42%

Google Confidential and Proprietary

Being top sponsored and top organic listing delivers most brand recall

Source: Enquiro Research/Ipsos Interactive Services, May 2008, UK Example

3.95x

Google Confidential and Proprietary

Search ads have a clear impact on brand recall

Source: Enquiro Research/Ipsos Interactive Services, May 2008, Aggregated Data: All Industries, all countries (UK, Germany, France)

Brand Recall(do you remember it?)

Brand Recall(do you remember it?)

Brand Affinity(do you like it?)

Brand Affinity(do you like it?)

Purchase Intent(would you buy it?)

Purchase Intent(would you buy it?)

+ 2.5x1.18x 1.14x

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How winners get ahead in a slowdown

Drive profit by targeting

Manage costs

Invest for growth

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How winners get ahead in a slowdown

Invest for growth

Research

• Define your audience by demographics and commonly visited sites

• Discover individual site details

A research and media planning tool to identify the websites your target customers are likely to visit

Google Ad Planner

Media Planning

• Save the sites to a media plan

• Get aggregate unduplicated reach and audience composition

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How winners get ahead in a slowdown

Drive profit by targeting

Google Confidential and Proprietary

Keyword Tool: pet or baby?

Pet carePet carepetpet fooddogdog foodcatcat foodpet advicedog breedscat breeds

9,450,000

babybabiesPregnancyparentingpregnantbirthnewbornbreastfeeding

Baby careBaby care

12,380,000

How many searches were made for the following keywords in one month?

Choosing advertising messages

Fuel efficiency most searched

Mix of messages

differs across the world

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How winners get ahead in a slowdown

Manage costs

Google Confidential and Proprietary

Search is not an island…

…it works best with other media

Google Confidential and ProprietarySource: iProspect, “Offline Channel Influence on Online Search Behavior,” 2007. RAB Word of Mouse Study 2007.

Offline media compliments online search

67% driven to search by an offline

channel

67% driven to search by an offline

channel

57% performed search after watching a

TV ad

57% performed search after watching a

TV ad

TV and online together

= 50% increase in buying likelihood

TV and online together

= 50% increase in buying likelihood

Google Confidential and Proprietary 27

60% of online shopping carts are abandoned

Source: Tealeaf Press Release “2008 Tealeaf Survey Highlights Potential Multi-Billion Dollar Business"

…make every conversion count!

12% before check out 48% at checkout

HIghest Paid Persons OpionsHighest Paid Person’s Opinion

Avoid the Hippo

Which site converts better?

Winning Page – 20.2% Conversion Lift!

Google Website Optimiser

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Benefits• Free Experimentation Tool

• Easy to use

• Backed by Google

• Increases in ROI by >50% not uncommon

• Discussion groups, tutorials, partner networksure

Features A/B Split Testing

Multivariate Testing

Follow Up Testing

Works with ALL traffic

Statistical Significance Analysis

Live reporting updated hourly

Quarterly feature updates

The Google online advertising toolkit

www.google.co.uk/adtoolkit

How Google tools can help

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Ad Planner – target customers across the web

Adwords – target people searching for what you sell

Webmaster – make sure your site can be found

Invest for growth – Gain share of the growing online market

How Google tools can help

Insights for search – react fast to changing demand

Conversion optimiser – optimise your ad spend for profitability

Adsense – earn extra revenue from your visitors

Drive profit – Target efforts based on the facts

Website optimiser – drive conversions by learning from rapid tests

Analytics – drive efficiency by understanding your visitors

Ad toolkit – learn more about all of this

Manage costs – Use science not art to make the most of your budget

www.google.com/domorewithless/ www.google.com/domorewithless/

Google Confidential and Proprietary 35

Thank you!

Sophie Jones

Industry Manager, Google UK

Google Confidential and Proprietary