Google CFO Patrick Pichette at Google offices in New York CityMichael Falco
Google Inc.'s Canadian-born chief financial officer is back in his home country, trying to convince businesses here that when consumers make purchasing decisions, they turn to the Internet first.
"All these eyeballs that used to be on TV, they've all shifted online," Patrick Pichette said in an interview at Google's Toronto office. "Advertisers have not."
Even as it expands into mobile devices, social networking and a host of other areas, Google's core profit engine remains Internet advertising. Mr. Pichette is on a whirlwind tour of Canada aimed in part at showcasing Google's ability to provide advertisers with access to specific demographics at a level of detail unavailable in most traditional media.
By some metrics, as little as 3 per cent of Canada's population regularly does its shopping online. However when it comes to using the Web to research those shopping decisions, that number jumps to between 50 and 70 per cent. Canadians also have a voracious appetite for online video, an area of particular interest to Google as the company attempts to monetize its huge store of Youtube videos and entice advertisers to pay for flashier multimedia-based ads.
As an example of the kind of specificity that Google can offer advertisers, Mr. Pichette pointed to a discussion he and his daughter - a Second World War history buff - recently had on Google's G-mail, trying to determine where to go on holiday. Mr. Pichette suggested a cycling tour in Europe. Sure enough, before he even began searching for such a tour, G-mail displayed ads for cycling tours based in Europe focused on Second World War historical sites.
"Now it's not just an ad," he said. "It's answering a problem."
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Whether consumers and businesses will buy into the notion of advertising as problem-solving, however, remains to be seen. As Google expands its reach into the Web's fastest-growing areas - especially social networking - the Internet giant is facing several significant hurdles. Google Buzz - the company's attempt to compete with microblogging site Twitter - raised serious privacy concerns after its release earlier this month, as critics complained the software exposed far too much personal information.
Mr. Pichette said many of Google's products undergo a process called "dog-fooding" before being released to the public. Dog-fooding essentially entails letting people within the company play with a product first. He said the internal response to Buzz was positive, but that the company began receiving almost instant feedback from a much wider audience once the product was made public, exposing issues Google's testers never thought of.
In addition to social networking, much of Google's recent business focus has centred on mobile devices - for example, using a user's location, via GPS, to return geographically relevant search results. Mr. Pichette said the profitability of such innovations is a tertiary concern at Google, behind user experience and scalability.
"We're an unconventional company, we make no bones about it … and I think our investor base mirrors that," he said.
"If all you care about is profit, then you worry."