How do you create more competition within an auction? Allow other formats to compete on the same space – essentially expanding out the auction and bringing more formats into the mix, to help keep the auction healthy.
Last summer, Google announced Discovery ads – a new format designed to monetise their Discover Now feed (right), which boasts 800m users globally and previously carried no ads. But to ensure some level of competition upon launch, the format also runs across the Google Display Network (GDN), YouTube static formats and Gmail, the latter of which possesses 1bn active global users.
Discovery ads see Google removing some of the more manual adjustments from optimisation and place more in the hands of machine learning. For example, you can’t remove placements, as Google looks to monetise its online properties. Instead, to achieve their goals, advertisers are required to put their faith in the machine to manage bid strategies and deliver this.
More recently, Google announced that from March 2020, Google Shopping ads from search will now be eligible to run across Gmail placements, allowing those higher cost per click (CPC) shopping placements to compete directly with Gmail Sponsored Promotions (GSP). Google grew Q4 revenue 17% year-on-year in 2019, to $45bn, but perhaps this is not enough for the search giant as it looks to further monetise its vast network of web properties – while at the same time blurring the lines between the formats.
All Response Media viewpoint
While we continue to drive client campaign performance, we embrace a move towards buying based on data signals and intent. When bidding for audiences with a higher propensity to convert, our focus is on exactly that and less about the placements. If we can target users with high intent across the GDN, Discovery feed, YouTube, Shopping, Maps and Gmail with the most relevant format then, it benefits all involved.
Allowing formats to run across more placements achieves this and ultimately provides greater reach, as well as giving Google more 1st party scope to reach those users. This has the potential to pull more advertisers into each mix, willingly or otherwise. Advertisers that might have previously only been active on Shopping will now be active across Shopping and GSP – which could inflate the auction. Moving to machine learning then puts the focus on letting the machine drive the result, by giving it ‘more’ to optimise and work with, where previously All Response Media have had huge success with carving out niches. So, while we are in favour of this move, we have also always enjoyed the level of control and transparency that allows intervention. Time will tell how this evolves and develops.
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