Update: Google launches AdWords reseller program in China

Company hopes to broaden advertisers in that country

Google has launched an authorized reseller program in China for its AdWords pay-per-click online advertising business, a move intended to broaden the number of advertisers in that country, the Mountain View, California, company announced Tuesday.

Google has already picked three resellers to hawk AdWords ads and offer support in the country: China Enterprise (www.ce.net.cn), China Source (www.zzy.cn) and Hotsales (www.hotsales.net)

Google chose these resellers because they all have "strong customer bases" of small and medium-size businesses (SMBs) in China and because they all offer a "high level" of support to their clients, Google said in a statement.

Until now, the only way for Chinese companies to buy AdWords ads has been online in the AdWords section of the Google Web site, said Sukhinder Singh-Cassidy, Google's vice president of Asia-Pacific and Latin America operations.

Now, Google has trained salespeople from these three resellers, so that they can go out and sell AdWords ads, evangelize the program and educate Chinese advertisers on the benefits of cost-per-click, she said.

"We selected these three partners very carefully," Singh-Cassidy said.

China Enterprise is one of China's largest providers of online services, such as domain name registration and Web hosting, she said. It has about 4,500 employees and over 200,000 customers, most of which are SMBs, she said.

Meanwhile, China Source is the second-largest reseller of online ads in China and has about 2,300 sales representatives and about 50,000 clients, most SMBs, Singh-Cassidy said. Hotsales does business mostly in the eastern part of China and has about 350 online ad sales representatives, she said.

The resellers will offer advertisers a local vehicle to buy AdWords ads and receive service, support and advise from staffers trained by Google, she said.

For example, one advantage the resellers will offer Chinese advertisers is the ability to pay using local methods, whereas the only way for them to pay using the online AdWords platform is with an international credit card, Singh-Cassidy said.

"The other key benefit is the personal touch experience: having a sales rep call on you, help you set up the account, provide ongoing support for your [ad] campaign, and so on," she said.

The reseller program is a key part of Google's efforts to penetrate the Chinese online advertising market, especially the SMB segment. The market has proven to be a challenge, given China's size and the fact that SMBs are spread all over the country, Singh-Cassidy said.

"This is a significant initiative to increase the availability of AdWords in China," she said.

All 3 companies will provide advice, support and other services to AdWords buyers, she said. Each will charge advertisers a service fee of at least 20 percent over the cost of the AdWords ads, Singh-Cassidy said.

This reseller program is very similar to others Google has in other parts of the world, such as the reseller partnership with BellSouth Corp., designed to reach SMBs in the southeastern U.S., and InterPlanet SA de CV, an authorized reseller in Mexico, she said. "In China, this program is very important given how large the SMB space is and how geographically it is," she said.

Having trained the sales staff of the three partners, Google is giving them the green light to begin selling AdWords ads this week, she said.

Google is "intently focused" on business opportunities outside the U.S., said Chief Financial Officer George Reyes last month during a conference call to discuss Google's second quarter financial results. International operations made up 39 percent of the company's total revenue during that quarter, ended June 30.

Google plans to open a research and development center in China in this year's third quarter, the company announced last month. That center will be headed by Dr. Kai-Fu Lee, who is also president of Google's operations in China. With this center, Google hopes to create a strong research and development team in China to develop products and services for users and partners in that country and elsewhere, Google said in July.

After Lee's hire, Microsoft sued him and Google alleging breach of Microsoft’s employee confidentiality and non-compete agreement. Before joining Google, Lee was corporate vice president of Microsoft's Natural Interactive Services Division.

Microsoft alleges that Lee has direct knowledge of its trade secrets related to search technologies and of its China business strategies. "He has accepted a position focused on the same set of technologies and strategies for a direct competitor in egregious violation of his explicit contractual obligations," Microsoft said in a statement in July.

Copyright © 2005 IDG Communications, Inc.

How to choose a low-code development platform