Google lets third party networks bid on AdSense publisher sites

The move means that if Google offers $2 CMP (cost-per-thousand-impressions) on display ads for a site, but another ad network bids higher at $3, the other ad network's ad would be shown, resulting in more money for the publisher.

Google said it will judge outside ad networks according to its commitment to users' "privacy, accuracy of measurement, latency, and compliance with our creative policies" before allowing them to bid on the programme.

Companies may also opt out of allowing outside networks to bid on inventory, but Google says they'll be missing out on an opportunity to generate more revenue.

Additionally Google will also not allow these ad networks to collect any user data to be used for internet-based advertising.

For AdSense publisher this means new ways of generating revenue from their display ad space. While for AdWords advertisers, this would mean some adjustment on their ad campaign allocation and budget to compete against these ad networks on prime display ad spots.

This new feature will be initially available for AdSense publishers in the U.S. and Europe.

A sea change in display advertising?

Search marketing agency Bigmouthmedia has that if successful, the move will change the shape of the online display advertising industry forever, and underlines the search giant's determination to extend its reach beyond text advertising and into the world of display.

Under the terms of the policy change, advertising networks that have traditionally focused activity on big brand sites will now have access to Google's extensive network of blogs, forums and websites.

Lyndsay Menzies, Chief Operations Officer at bigmouthmedia, said: “Traditional ad buyers will face a new world if Google manage to make this work. They’ll be looking at an environment where site owners can block entire networks if they don’t perform or can block specific advertisers. Display will be less about big deals and negotiating with decision makers and will become much more like search marketing in terms of its scientific and performance led nature."

Welcoming Google’s insistence that only networks that meet their privacy, speed and quality guidelines will be included in the expanded AdSense, Bigmouthmedia believes that the move will require significant changes to the thought process behind a display campaign. Micro-management will become more important as individual publishers are given the opportunity to opt out of entire ad networks or ban ads from certain sites.

The digital marketing agency also notes that the move will be seen as bad news not only for the third-party networks which Google will not qualify, but also for any third-party bid management platform that fails to integrate with the extended system.

"This is a very interesting move which will work if the thousands of AdSense publishers out there support the move. If there’s enough demand from the AdSense publisher community then ad networks will certainly not want to pass on the opportunity,” said Andrew Girdwood, Bigmouthmedia's Head of Search.

"If Google get enough extra volume of image ads through this then, as a publisher, why wouldn’t you simply install the AdSense code and let everyone engage in a bidding war to display on your site? There'll be no need to pay third parties to strike deals with you, and that will mean a significant increase in revenues for existing advertising platforms."

View Google’s AdSense announcement here

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