Commentary

What Facebook's Link To Google's Open Bidding Means For Publishers

Publishers that use the Facebook Audience Network to sell ads in their apps and mobile websites now have access to Google ’s Open Bidding program.

The connection between the digital ad giants gives publishers access to more potential buyers of their ad inventories. Facebook Audience Network lets advertisers reach audiences on mobile sites and apps other than Facebook.

Facebook claims in a blog post that joining Google’s Open Bidding program will help publishers maximize their sales by letting multiple sources of demand — ad networks, exchanges and demand-side platforms — compete to place bids in a unified auction.

Bidding lets advertisers compete in real time for a single ad placement with an exact price.

Traditional print publishers have had to come to grips with how much of their digital ad inventory they want to hand over to programmatic placements. They must balance concerns about lower rates and margins with possible cost savings in their sales operations.

While automating ad placements can help publishers to reduce headcount, they still need to manage their programmatic sales within a broader marketing strategy.

The system is different than waterfall mediation that prioritizes demand sources based on historical average prices, rather than the true value of the impression.

While real-time bidding (RTB) for ad placements has its pitfalls, advertisers are adopting the technology to target ads more precisely and to scale up their campaigns quickly. RTB got its start in selling heavily discounted remnant inventory, but it has made inroads into premium ad placements.

That’s not to suggest publishers need to turn over a huge portion of their ad inventory to RTB. They also can run programmatic sales for ads don’t run for several days or weeks.

Publishers need to develop a strategy of splitting up their inventory among sales in a variety of channels. The lowest end is an “open” exchange that doesn’t provide much transparency and unfortunately runs the risk of showing inappropriate ads. Plus, publishers can offer ad placements on a “private” exchange that makes the inventory more transparent to bidders, and likely boosts the price.

By working with platforms like Facebook Audience Network, publishers can sell ads on a fixed-price basis with delivery either guaranteed or non-guaranteed, which also affects the price they can command.

Whatever the strategy, publishers want to avoid seeing their inventory get sold as discounted remnants. That requires closely monitoring these inventories to avoid cannibalization of premium-priced ad placements.

Handing off some sales to programmatic placements lets publishers focus on higher-margin sales, such as demonstrating the value of their audiences and their engagement with editorial content.

Paywalls are another way to monetize content as part of the sales strategy. Publishers that put up paywalls may limit their audience, but they also can show that they have committed readers who value the content. They can seek premium rates for these more engaged readers, and everybody wins.

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