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DIGITAL ADVERTISING

Google announces it is moving AdSense to a first-price auction

By our News Team | 2021

The change will make it easier for buyers to purchase advertising space being sold on AdSense, company explains in a blog post.

Google has announced that it will be moving the AdSense auction from second-price to first-price in the coming months. The company says this change will make it easier for buyers to purchase ad space being sold on AdSense.

Making the announcement in a blog post by Product Manager, Matt Wong, Google said this was part of a continued effort to simplify AdSense.

There is no action required from businesses selling advertising space via AdSense and they will likely not see a change in their earnings.

Why Google built AdSense

“Creating great content takes time, but earning money from it shouldn’t,” Wong writes in his post. 

“That’s why we built AdSense, to help you make money from your site with an easy-to-use advertising platform. AdSense simplifies advertising for you by automatically tailoring ads to your site’s layout, optimising for mobile web and connecting you to millions of advertisers.”

Google AdSense

Outreach Pete via Wikipedia

Wong added: “We’re making this announcement now to help our advertiser partners prepare before we change how the AdSense auction works.”

What’s going to be happening

In the early days of online display advertising, ad space was sold to advertisers in a second-price auction, where the final price paid by the winner was determined by the amount of the second-highest bid. 

Over time, many ad selling platforms in the display advertising ecosystem, including Google Ad Manager and Google AdMob, switched their auction to first-price. In a first-price auction, the final price reflects the winning bid. In the coming months, AdSense will move to a first-price auction. This will help advertisers by simplifying how they buy online ads and make it easier for them to buy ad space sold on AdSense, Google says.

Benefits to publishers and advertisers

By streamlining the auction model across AdSense, Ad Manager and AdMob, Google explains that it is aligning its process with other ad-selling platforms in the display advertising ecosystem. 

“We believe this will help grow advertiser spending confidence in digital advertising and an increase in spending confidence over time will benefit publishers (that’s you),” Wong wrote.

Google expects the transition to a first-price auction to be completed later this year.

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