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In a surprise to many experts, Google has begun offering image based ads to their AdWords clients. This new format of Google ads will, like all AdWords/AdSense campaigns, be contextual targeted.

Google does not have plans to display these image ads on Google itself; they will be displaying them on sites that have accounts with Google. From Google's image ads description page:

"we won't show image ads on Google. The initial launch of image ads is focused on sites already showing graphical ads. Because Google image ads are targeted specifically to a page's content, advertisers showing ads on these sites would realize the greatest benefit."

The formats that Google will be featuring in its newest addition are as follows: Banner (468 x 60), Leaderboard (728 x 90), Inline Rectangle (300 x 250), and Skyscraper (120 x 600).
The image ads campaigns will be on an opt-in basis. Also, when you do decide to show image ads, they may be mixed in with the familiar text-based ads. More from Google:

"The AdWords system will analyze a number of factors on a Google Network content site page and determine whether your text ad or image ad is more appropriate.

If your image ad is more relevant, it will appear. If not, your text ad may appear in its place. This targeting model ensures you're reaching your prospects with the most effective ads. (Please note that a content site publisher must opt into the image ads program before your image ads may appear on his or her site.)"

The reason Google states for offering images in their AdWords program is because they are attempting to diversify their approach to targeted advertising. "Our commitment has always been to enhance the overall web experience for users, advertisers, and publishers by delivering relevant search results and ads."

Although, one has to wonder if changing a medium that brings in such a large portion of your revenue is the best idea. Last year, Google earned $962 million worth of revenue. 95% of that was from ads.

Considering the DoubleClick survey which pointed out that click rates on this medium remained lower than expected, is adding images necessarily the best option? Over at SearchEngineLowdown, Andy Beal has an excellent write up of his impression of Google's newest ad format. He asks "since when do banner ads convert at the same rate as text ads?" It will be interesting to see if all change is good change.

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