Google generated $5.4 billion in Q3 revenues in the APAC region, contributing to 16% of total revenue in that quarter. In the APAC region, the primary monetization source continues to be Google-owned & operated properties such as the search app, Gmail, Google Maps, Google Play, and YouTube.
“Local mobile searches are growing faster than just mobile searches overall and have increased by almost 50% in the last year,” said Sundar Pichai, CEO of Google, during the earnings call. “So for us, that’s an important focus area and [Google] Maps plays a big role there.”
Pichai pointed to the recently launched local campaigns feature for footfall generation, which has started with experimentation in new ad formats such as promoted places which appears on Google Maps and will be rolled out as user experience tests reach an internal benchmark for quality assurance.
Advertisers and agencies, large and small alike, are charged by Google on a cost per click basis or costs per impression basis, depending on the intended ad format. To incentivize the use of its properties for digital media planning and buying, Google offers rebates, cash-based incentives, and credits to its large and frequent customers. For 2017, Google refunded $1.3 billion in rebates to its partners that met performance targets.
The secondary source of monetization for Google is classified as “Other bets”, which comprises of revenues from Waze, Waymo, apps, in-app purchases, and digital content in the Google Play Store. It also includes Google Cloud offerings and hardware.
“We are very aligned with where the market is headed in the long run,” said Pichai. “This notion that of supporting open architecture so that enterprise don’t feel locked in and allowing for a multi-cloud environment to develop – that’s the direction we are betting on and our indications are that the market is headed in that direction as well.”
For the nine months ended 30th September 2018, revenues for the APAC region grew by 33%, compared to 29% for the same period in 2017. APAC earnings were favourably affected by foreign currency exchange rates due to the U.S. dollar weakening relative to the Japanese yen and South Korean won, while hedging benefits offset the strengthening of the Australian dollar and Indian rupee.
In 2018, Google increased in sales & marketing investments to help promote its offerings around Google Cloud, the Chrome OS, and the Google Assistant. Globally, a total of $3.849 billion was invested in sales & marketing for Q3 2018 in order to generate $33.74 billion in revenues, which is nearly nine times the return. For the nine months ending 30th September 2018, Google generated $97.543 billion by investing $11.233 in sales & marketing, 8.7 times the return.