Interesting piece today in the NMA relating to Google’s Advertising Exchange plans. Although it was well known among agencies and media buyers that Google was placing its DFP publishers at the heart of its exchange strategy, little was being said about the launch of a futures market for advertisers. Google are now looking to launch a forward display advertising marketplace – otherwise known as “In Future” - early next year.
It makes sense. They allow DFP publishers to sell chunks of future inventory to either agencies using DFA or invited buyers, and they take a cut of the price agreed for the ad impressions. The publisher is happy because they’ve got guaranteed income. The agency is happy because it can negotiate a price for premium inventory. And Google’s happy because it’s got another revenue stream.
The futures market concept will appeal to publishers because it removes the risk involved in non-premium display. The price of inventory can fluctuate on “spot-buy” exchanges, like RightMedia. Agencies will ultimately pay the market value for impressions. By agreeing a price for future inventory, publishers can lock in value for their ad inventory six-to-twelve months ahead of time.
The US currently leads the way in the ad futures market. There are a number of US-based exchanges presently offering a futures market, including ContextWeb, TraffIQ and AdBidCentral.
Europe's marketplace is dominated by spot-buy and non-premium exchanges. There is clearly an opportunity for a platform to offer this service – and there’s little doubt existing players, like RightMedia and Adjug, are developing their platforms to offer this trading opportunity to European publishers and agencies.
Google is looking to establish its exchange service as the market leader for spot-buying and advertising futures trading. This will attract a lot of buyers and sellers. But it will be interesting to see if Google allows DFP publishers to trade non-premium inventory on other exchanges - or more importantly if they're going to allow publishers, not using DFP, to trade on the new Adx platform.