Helping publishers get the most from display advertising with Admeld

(Cross-posted on the DoubleClick Publisher Blog)

It’s now clear that investments in new technologies, new ad formats and improved buying and selling processes are helping to grow the display advertising pie. This benefits publishers who make more money from display ads, users who receive free ad-funded content and marketers who are able to grow their businesses online.

However, we often hear from major website publishers that ad management today is still mind-numbingly complicated and inefficient. We’ve been investing in our publisher tools to try and improve this landscape and have made great progress, but we think we can do even better. To help major publishers get the most out of the rapidly changing and growing display ad landscape, we’ve signed an agreement to acquire Admeld, a New York-based yield optimization firm.

Here’s a basic summary of the display ad industry, from the perspective of major publishers. There are lots of different ways that they can sell their display ad space. Often, they’ll sell space directly to advertisers or agencies, using an ad server to actually deliver and measure the ads (like Microsoft’s Atlas, AOL’s AdTech, DoubleClick's DFP, Yahoo’s APT, OpenX, Zedo, 24/7 Real Media and others). Alternatively, they’ll make their ad space available indirectly—to hundreds of ad networks (like Advertising.com, Specific Media, Collective, 24/7, ValueClick, Vibrant, AdSense, Undertone and others), each with thousands of advertisers, or to various advertising exchanges or technology platforms (like Yahoo’s Right Media, OpenX, DoubleClick Ad Exchange, ContextWeb, AdBrite, AppNexus and others) that match them with ad buyers (like ad networks and demand side platforms) who represent advertisers, in real-time marketplaces.

Some publishers also work with a “yield optimization” provider (such as Rubicon Project, Pubmatic and others) that supplies technology to select ads from across these many indirect options, while providing personalized service and support. In a very complex and rapidly growing display ad landscape, that’s what Admeld does.

Providing better ad management services to publishers is an area that has seen a huge amount of investment in recent months. Formed just over three years ago, the Admeld team is an example of the huge strides the industry is making—it has quickly developed a great service that is helping many major publishers manage their ad space more efficiently and profitably.

By combining Admeld’s services, expertise and technology with Google’s offerings, we’re investing in what we hope will be an improved era of flexible ad management tools for major publishers. Together with Admeld, we hope to make display advertising simpler, more efficient and more valuable, provide improved support and services, and enable publishers to make more informed decisions across all their ad space. These are all things our publisher partners have been asking us to further invest in. Of course, Admeld will continue to support other ad networks, demand side platforms, exchanges and ad servers, to yield the best possible results for publishers.

We believe that this investment will be an important step to help online publishers, and will further improve and grow the display advertising industry as a whole.

Posted by Neal Mohan, Vice President of Display Advertising

There’s a perfect ad for everyone

It’s been an exciting year in the display advertising business—the movement of media online and the emergence of new technologies are causing incredible growth, and we’re investing significantly to help improve display advertising for publishers, advertisers and users. But I believe we’re poised to make even greater advances in the years ahead. We’re at the beginning of a user-focused revolution, where people connect and respond to display ads in ways we’ve never seen before.

This was the subject of a keynote I gave this morning at the Interactive Advertising Bureau’s Innovation Days @ Internet Week entitled “There’s a perfect ad for everyone.” You can view the recording at google.com/watchthisspace. In the speech, I made six predictions about how display advertising will change for the better by 2015:

1. The number of display ad impressions will decrease by 25 percent per person. Today, people are bombarded by online ads, but they don’t connect with most of these ads in a meaningful way. I believe the trend will be for people to ultimately see fewer, but better ads.
2. Engagement rates across all display ads will increase by 50 percent. As ads become less cluttered, more relevant, more engaging and more attractive, we’ll see the rate at which people interact with display ads (such as watching videos or playing games) increase dramatically.
3. People will have a direct say in 25 percent of the ads they see. Whether by choosing to watch—or not watch—video ads, updating their ads preferences to customize the ads they see or actively subscribing to or choosing to receive particular ads, users will be more in control of when and how they see ads online.
4. 35 percent of campaigns will primarily use metrics beyond clicks and conversions. Technology is helping marketers measure their ads with new tools that look at factors like emotional engagement and impact on offline behavior (like in-store shopping choices). We see a longer-term future where these become the primary metrics used to measure the success of a campaign, meaning marketers will be able to deliver the ads that potential customers say they like the most.
5. 25 billion ads per day will tell people why they are seeing them. We believe it’s important to give people as much information as possible about why they see particular ads. That’s why we’ve always included an “Ads by Google” notice, and now the AdChoices logo, on ads across the Google Display Network. We strongly support the widespread use of this logo by members of the display industry and by 2015, believe that this sort of notice will become ubiquitous.
6. Over 40 percent of online Americans will name display ads as their favorite ad format. We recently conducted a survey with YouGov of more than 1,000 U.S. Internet users, asking them what ad formats they liked. The number of people who said they preferred display ads trailed slightly behind the number who liked glossy magazine ads, cinema ads and even sky-writing—formats that have been around for more than 50 years! We think this will change. Display ads provide an incredible platform to engage, excite and inspire. If we as marketers, publishers and technology providers can deliver experiences that delight the user, we can take this industry to new heights.

I believe that display advertising will eventually grow to become a $200 billion industry. If we make users our focus as I described this morning, it will put us well on track to reach that goal. I can’t wait to see a future in which the full potential of display ads is realized, providing a universally positive experience for people online and helping grow the businesses of publishers and marketers.

Posted by Neal Mohan, Vice President of Display Advertising

Three years of Google + DoubleClick by the numbers, and video arrives on the DoubleClick Ad Exchange

In 2008, we acquired DoubleClick, and our efforts to make the display advertising landscape a better, simpler place for users, publishers and marketers began in earnest. Today marks exactly three exciting years together. The time has flown by, and we’ve made huge strides towards our goal, largely powered by DoubleClick’s technological and industry expertise.

Here are a few of the things we’ve achieved in the past three years: we’ve offered people control over what ads they see on the web, created a new way for advertisers and publishers to buy and sell ads, given publishers a powerful tool to maximize the value of their content, introduced a way to bring a campaign to life across the web with instantly customized creative, added a platform to buy across ad exchanges in real time, enabled small advertisers to launch display campaigns in minutes, introduced a highly effective way of delivering ads to interested consumers on the Google Display Network and rolled out video ads that allow consumers to watch only the ads they want to see (while letting advertisers pay for only the ads that consumers watch).

We realize that the display industry is still complex (we actually turned to the laws of physics to help marketers navigate their way through it). But we’re getting there.

A few numbers help tell the story of the past three years:

• 5,400,000: A rough estimate of the hours our engineers have spent working on our display business since 2008 (that’s equivalent to 616 years without sleep or rest)
• 33 billion: Our estimate of the number of potential customers that our clients’ display ads have driven immediately to marketers’ websites (to say nothing of the exposure, engagement and brand-building that these ads enable)
• 5: On sites in the Google Display Network, the number of times larger that spending on display ads is today, compared to three years ago (that’s like a toddler growing to the size of a one-story house)

We’re kicking off year four with another step towards our overall vision: the addition of video ad formats to the DoubleClick Ad Exchange. We’re about to start a beta test, allowing Ad Exchange buyers to run in-stream video ads on YouTube using real-time bidding technology. (We’ll eventually extend this capability to include additional video formats and will serve ads on more videos across the web.)

We think that video ads are going to quickly become an even bigger piece of the display landscape. And in our own survey with Digiday, about 20% of marketers indicated that they wanted to use real-time bidding to buy video ads this year. Combining the power of exchange buying with the potential of video will to help grow the advertising pie (or in honor of today’s anniversary, cake) for everyone.

We can’t wait to see what else the next year has in store.

Update 10:53 AM: Fixed one of our estimates.

Posted by Susan Wojcicki, Senior Vice President, Product Management and Neal Mohan, Vice President, Product Management

The three laws of display advertising physics

It’s not just the Android team that is exploring the outer reaches of our galaxy. In recent years, advertising technology has had its own “Big Bang": a rapid onset of incredible growth and expansion in the display advertising universe.

Display advertising is one of our big focus areas. Better display advertising helps to fund the websites and content we all use and read, provides useful and engaging commercial information, and helps large and small advertisers to reach new customers, increase sales and grow their businesses.

Just as the laws of physics have helped us make sense of our own expanding universe, we think that there are three “laws of display advertising physics” to help advertisers and agencies thrive. We’ve laid out these laws and what they mean for advertisers and agencies on our Agency Ad Solutions Blog:

1. The Theory of Relativity: The distinction between different advertising technologies (like ad networks and demand side platforms) is blurring. Each of these technologies provides similar ways to achieve your marketing goals, depending on how you want to manage your campaign.
   
   
2. Fusion Theory: There’s a few different ways to deliver ads to people. Each on their own is powerful, but combining these different ways unlocks the best results.
   
   
3. The Law of Perpetual Motion: New technology is driving rapid change in display advertising—which is constantly improving marketers’ creative palettes and the way that ads are bought and sold. Embracing new media and technology provides a key way for marketers to differentiate and grow their businesses in a new universe.

The expansion in the advertising industry is leading towards a future with a better advertising universe for everyone—where people see more relevant, useful ads, publishers get better returns to fund their content and marketers can run more effective campaigns.

Posted by Neal Mohan, Vice President of Product Management