As internet marketing becomes a more and more competitive industry, no.1 search site Google is releasing a new product for their ad-space buying clients. Emily Gorton at Choose takes a look at Google’s first foray into credit cards…
The Ad Words Business Credit Card will be hitting a selection of Google’s customers as a beta test from this week and, after a suitable test period, will most likely become available to the wider American client base and eventually the UK.
So, when it does get here, what’s in it for you?
Well, this new MasterCard can be used exclusively for spending on Google ad space and has a low interest rate, no annual fee and a healthy amount of credit to borrow.
Google confirmed that the surprisingly low interest rate of 8.99% was not an introductory offer, but a continuous feature of the card.
Additional details such as credit limit will depend on the financial situation of each client
The vice president of global online sales at Google Claire Johnson claimed that the card is aimed at small to medium-sized businesses that use Google advertising but don’t always have the cash-flow to fund it.
She added that the card would come in particularly useful around events such as Halloween or Valentine’s day, where heavy ad campaigns are usually needed.
The card takes the lead from social network giant Facebook, who’s advertising space is now part of the AmEx Membership Rewards scheme.
AmEx card holders can exchange their points for free Facebook advertising, much like you can build up airmiles.
However, the Google card is the first exclusively for ad-space buying, and this is also the first time Google have ventured into this market.
So, what’s in it for Google?
The card will certainly help keep Google dominant in the internet advertising business.
This is imperative for the search engine as 96% of their revenue currently comes from this source and competition is rising from other major websites.
The MasterCard will inspire customer loyalty and increase purchases and help Google track the spending habits of their customers, as other companies such as Amazon have done with their exclusive credit cards.
However, Google’s Treasurer Brent Callinicos stated that the launch of the card was mainly to help customers through a difficult borrowing climate.
‘Obviously we have a robust balance sheet, so this is a way for us to use that balance sheet to help our customers. It isn’t a financial engineering project that we came up with and said this would be cool to do. It’s a customer need,’ he said.
One disadvantage of the card is that it does not provide air miles. But with the interest rate so low, this shouldn’t be too much of a problem.
The card invitations are being sent out to a ‘statistically significant’ number of people to estimate how well the product will do in the main market.
The Google Ad Words Credit Card will be issued through the World Financial Capital Bank.
This is a guest post from Choose. The site covers rights issues, research and debate into the consumer credit card and more broadly personal finance markets.
