If you manage an advertisement driven OTT platform on connected TVs that streams Video on Demand ( VoD) or 24 / 7 linear live content, then you would have definitely come across Google Ad ecosystem. Google leads the world in online advertising. Whether its search, websites, mobile apps and now, connected TVs and other streaming devices like Fire TV and Roku, Google commands the first port of call when someone needs to generate revenue online using advertising. While Google has been holding a dominant position in the text and display advertising, online video advertising is still an open playground and yet to have a clear market winner. For last 10 years or more recently in the last 5 years, online video advertising has gained prominence with players like SpotX, Telaria, The Trade Desk, Mediamath, DataXu (acquired by Roku) etc. gaining more ground than earlier with their razor sharp focus on video programmatic advertising.

While connected TV advertising market is expanding faster than universe would have expanded during the Big Bang, publishers in CTV domain are still trying to decipher the Google ad ecosystem. Google technologies and solutions can be daunting, especially, if you have never played in online advertising world. I have been dealing with video advertising technology and media technologies for a large part of my career and believe me when I say that even today, I get into discussions with people having decades of media and advertising experience and yet find it difficult to understand how Google ad-tech works.

So, In this article, I thought of explaining the fundamentals of how Google operates in the online video advertising space with respect to OTT platforms and content publishers.

First Things First

Image Courtesy : https://digitalthought.me/articles/digital-marketing/Programmatic-ad-bidding-cookie-sync.html
Let’s get some basic terminology out of our way so that all of it can make sense. Advertising systems work on basic concept of Micro-Economics i.e. Supply and Demand.

Supply : Supply refers to the inventory or the ad slots that are available for advertising and are sold by the publishers. That’s why publishers are also known as sellers.

Demand : Demand refers to ads that are made available by advertisers to be filled into ad slots sold by publishers. Advertisers are also known as buyers. Technically, Advertisers are called buyers because they buy available ad slots from publishers and then, place their ads in their ad slots. Supply or ad slot is also known as Inventory.

To make it simpler to understand; think of real estate space. Buyer buys a piece of land from the seller and then, builds a house on that land. In this analogy, land is the ad slot and house is the ad. Seller is the publisher and buyer is the advertiser.

Supply Side Platform : Technology platform that aggregate all the supply or ad slots from different publishers are called SSPs or Supply Side Platforms. Typically, these platforms provide technology to help publishers in making their inventory available online.

Demand Side Platform : Technology platform that aggregate all the ads from different advertisers are called DSPs or Demand Side Platforms. Typically, these platforms provide technolgy to advertisers and ad agencies to discover inventory so as to be able to buy those ad slots.

Ad Exchange : Technology platform that facilitate the buying and selling of ad space between publishers and advertisers are called Ad Exchange. Consider a simple example of a stock exchange. Ad Exchanges behave in very similar manner. Ad exchanges are also called Supply side platforms because they lean towards publisher side to aggregate inventory and connect with DSPs to enable the trading of ad space.

Ad Server : Technology platform that enables campaign management and ad serving. Both Publishers and Advertisers can manage their inventory using ad servers to either serve house ads, promos or commercials either bought by agencies or in house sales teams.

The Google Ad-Tech Ecosystem

Now, Let’s get back to Google advertising ecosystem. As Google leads the world in online advertising, their systems span across the depth and breadth of advertising ecosystem. In 2007, Google bought a company called DoubleClick for USD 3.1 billion that made Google what it is today in the world of online advertising. To get quick information about DoubleClick, read their Wikipedia page here . Over a period of time, Google added all kinds of tools in their technology stack to support both publishers and advertisers. Let’s decipher the original Google’s ad-tech stack first.

Image Copyright : Amit Goel : Free to use anywhere with due credits
Google DFP : Known as DoubleClick for Publishers, is a full fledged ad server that allows both publishers to manage inventory and allow it to connect with various demand side platforms and direct ad sales for inventory management and serve ads.

Google AdExchange : Also, known as AdX, it is an ad exchange that connects to demand side platforms and allow publishers to sell inventory to advertisers by allowing programmatic auctions in real time. Billions of transactions take place in this exchange every second. This Ad Exchange connects internally to Google’s own demand platform and also to 3rd party exchanges and demand side platforms.

Google DCM : known as DoubleClick Campaign Manager, Google provides this tool to ad agencies and advertisers to manage their ad campaigns across publishers. This tool is mainly used by buy-side to draft advertising campaigns with various parameters so as to reach out to relevant viewers.

Google DBM : known as DoubleClick Bid Manager, it is a demand side platform ( DSP) that drives the auction model ( bidding ) of Google and allows advertisers to buy the inventory they wish to at the best price possible. As a side note, Google used to base its auction model on Second Price Auctions but very soon, it will migrate to First Price Auction model.

Apart of above tools, Google also has something called Adsense and Adwords. AdSense is the tool for publishers by which they make their inventory visible to advertisers. Ad words (now rebranded as Google Ads) is the tool where advertisers can drive their campaigns to reach publishers. Both the tools are focussed mostly on the web world with websites and mobile apps driven by online advertising including text and display ads. These tools are irrelevant for CTV platforms as CTV inventory is considered high value and these tools are made to work for small and medium sized businesses with limited functionality.

In June 2018, Google undertook a major rebranding exercise and rebranded their whole ad technology suite.

Google Ad Manager : Google DFP and Google Ad Exchange are combined together to make one single solution for publishers called Google Ad Manager. All the functionality still remains the same with few improvements as of today.

Google Marketing Platform: Under this brand identity, Google created Display and Video 360 ( Google DV360 ) is the combined entity to have Google DCM and DBM in one single platform. Campaign Manager still can be accessed independently by the buy-side to manage campaigns. But Google DV360 becomes a complete DSP on its own.

Why does it matter to publishers and advertisers ?

With Connected TV advertising seeing a spurt in growth in last few years, another technology innovation came in place for publishers i.e. Dynamic Ad Insertion. Known as DAI, it is a server side ad insertion ( SSAI ) technology. For example: If you have seen ads on Youtube that play before and during the content playback (known as pre-rolls and mid-rolls), these ads are played on client side. It means your browser or client app is taking care of all ad insertion. But this results in bad user experience like buffering indicators show up, ad blockers do not let ads to function or if you have many apps, then your development team is busy integrating all client side SDKs. With SSAI, the system became simple like an TV channel being streamed smoothly over the internet without any disruption to user experience or any loss of ad dollars to publishers because of ad blockers.

But advertising industry wasn’t ready for this change instantly. Trusting some third party DAI server firing trackers that identified ad impressions and track viewers wasn’t easy for advertisers who invested millions of dollars to track user behaviour without actual client SDK integrations. So, SSPs and DSPs other than Google evolved very quickly into CTV programmatic advertising domain that allowed the ad-tech stack to work in sync with DAI systems and build the trust with advertisers in the SSAI technology. In 2016, Google acquired another DAI company called Anvato and rebranded it to launch Google DAI solution. This caused a big confusion in the market as at that time, Google announced that Google ad-tech solutions will support only Google DAI, blocking publishers to get dynamic ad insertion solutions from other leading DAI technology companies like YoSpace and Amagi among others. With the OTT platforms in its early days ( even 2020 is still early days …), publishers and advertisers while eager to adopt DAI technology, weren’t willingly ready to comply with this dictat of Google.

With the new SSPs and DSPs becoming significant in the CTV / OTT market, both publishers and advertisers rushed to these platforms ignoring Google. Large media houses did not want to get locked into Google ecosystem allowing Google to take away the lion’s share of the market. SSP Platforms like SpotX, Telaria, Beachfront were able to connect with DSPs like MediaMath, DataXu, The Trade Desk etc to drive advertising in Connected TV world with high value transactions taking place. Along with that, new ad server technology companies like SpringServe and Vidazoo rose to prominence in the CTV market with their platforms targeted towards the needs of CTV industry.

As the market starting expanding beyond Google with other ad tech platforms taking lead, Google could not ignore the market. Now, Google Ad Exchange connected with 3rd Party DSPs along with Google DV 360 on equal priority, unlike earlier, when it prioritised its own DSP over others. Similarly, Google DV360 (as a DSP) connected with Google AD Manager (and internally, Google AdX too) to allow inter-operability in the market. Google AdX is the only component that hasn’t still upgraded to allow 3rd party DAI systems and still needs IMA SDK integration. That still makes it difficult for publishers to have client side ad insertion technology integrated in their OTT apps only for the purpose of getting access to Google Ad Exchange. But as Google Ad Manager (GAM) allows to connect with all other SSPs, connecting with AdX is not so important anymore.

This means, as a publisher, if you have bought the license to Google Ad Manager, you can use it as an ad server and still choose to get any DAI vendor and work with any 3rd party supply side platform without buying the access to Google AdX. At the same time, you can also choose to use any ad server like SpringServe in the market or use a default one from the SSPs like SpotX and Telaria and still connect to large DSPs like The Trade Desk, Mediamath, Amobee or others while getting the best buck for your inventory. When you go on either of this path, you get to ignore AdX that also sources the ads from the same DSPs as others and still work seamlessly with the SSAI solution of your choice.

The only requirement for 3rd party DAI systems remain is to integrate with Google Campaign manager ( check this link for requirement ) only if the publisher is sourcing ads from ad agencies that use Google Campaign Manager system.

Google DV360 now connects to almost all of the known SSPs. For the complete list of SSPs connecting to Google 360, you can check this link

Hope this helps you understand the Google Ad Ecosystem and also, help in planning your ad monetization and operations strategy. If yes, you can share it with others on social media and like it. if you have any questions, leave a comment and i’ll try to answer as soon as possible.

References

1. Dynamic Ad Insertion with Google DAI
2. Dynamic Ad Insertion with Amagi DAI product Thunderstorm
3. Serve VAST Ads without IMA SDK
4. Compare Ad Exchange and Ad Sense
5. AdExchange in Google Ad Manager
6. Ad Exchanges connecting with Google DV 360
7. Programmatic Advertising - The Ad Tech Book
8. Curious to understand how the programmatic ecosystem works in detail?