Why Google Intends To Become The Dominant Player In The Exchange Marketplace

Google can see the opportunity in ad exchanges – and knows it can reap the financial rewards if it can improve trading volumes on its platform. A recent ThinkEquity report suggests that the growth of non-premium display advertising will outpace search marketing over the next six years. The chart below illustrates in more detail why Google is looking to increase its presence in the non-premium display market. Search will continue to grow, but the real revenue growth will come in the way publishers sell their unsold ad inventory.

The new platform is due to launch its new exchange in Q3, and it looks like it should have a major impact on the exchange marketplace.

Google will be bringing together Adsense, Adwords and the existing DoubleClick exchange. It will be a strong buying opportunity for those trading on the exchange. The targeting capabilities will also be a big draw for sellers and buyers, as existing DFP publishers will be able to leverage their user information on the exchange. This will allow publishers to maximise the amount they can charge for their inventory. Jonathan Rosenberg, Google's SVP for Product Management, recently set-out the company’s ad exchange strategy in a recent earnings call:

We're happy with the progress on the ad exchange. We've integrated the existing double-click exchange with the AdWords and AdSense advertisers and it's all on the Google infrastructure at this point. Overall the idea is about creating the biggest pool we can of liquidity so advertisers will find opportunities where they can't today and be able to monetize inventory the most efficiently.

The area of non-premium display is growing, and Google is preparing to take full advantage.

Projected Growth Of Search Versus Non-Premium Display (Source: ThinkEquity)