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It’s been 15 months since Google (NSDQ: GOOG) formally linked AdWords to DoubleClick and launched its display Ad Exchange. Thanks in part to DoubleClick’s established hold on ad dollars, plus an ad recovery that has been particularly favorable to display, the AdEx is showing surprising growth — even given the high expectations it faced. Neal Mohan, Google’s VP of product management, in an interview with paidContent, said that the AdEx tripled the number of transactions since last year. He claimed that as a result, AdEx publishers can expect to generate, on average, 188 percent more revenue compared to other bidding systems.
Mohan explained the 188 percent lift this way: “We didn’t use a sample, we used all our publishers and real numbers. We would find the price that was won at auction and compared it to the next price for the same ad slot. Because we were logging all the data, we had the losing price data to compare. We then multiplied it across the publishers, you get not just the eCPM. It works for what ever tier. We can deliver revenue lift for both high and low CPMs.”
The demand from advertisers to use ad exchanges has also helped Google’s service gain a higher degree of traction as well. The major ad agency trading desks were firmly established in the past year. Right now, 56 percent of media buyers online ad spend is devoted to real-time bidding.
As it looks back over what drove display ad sales the past year, Google is also looking for ways to keep the money and publishers’ inventory flowing into its system. Among the latest tools added to the DoubleClick Ad Exchange are Private Ad Slots, which are customizable, invitation-only auctions that allow publishers to make certain ad spaces available only to select advertisers. They’ll be able to assign variable pricing floors depending on the buyer. “Publishers have been responding to this system because we’ve promised them more controls,” Mohan said. “We’ll continue working on that this year as well.”
Also on tap for this year: Google plans to ad more tools for getting more mobile and video inventory on to the exchange. More details on Google’s report card is here in this official blog post; there’s also an accompanying white paper here.