Google Posts Big Display Numbers, As It Breaks Out Q3 Results; Pubmatic Report Suggests Big CPM Lifts For RTB Ad Inventory

» Google is now earning $2.5 billion from non-text display on the YouTube and DoubleClick platforms, as it uncharacteristically broke out details of its Q3 earnings. The numbers are a bit fuzzy on detail. There's no indication what percentage is coming from Adx, YouTube, Invite Media, or the server costs paid by DFA and DFP server customers. In fairness this could all be some grand standing from the big G to impress analysts on Wall Street. Still these numbers suggest Google is making serious progress in this part of its business and is surely a big vindication of data-drven display - but this data is likely to send some panic through the space. Agnostic ad tech vendors should be using this as a big stick to beat Google around the head with. And why not? I'll say it again: one company's domination is unhelathy for any market. Both publishers and advertisers need to be aware that throwing their lot in with one vendor - no matter how attractive the pay-off is - will ultimately be self-defeating. Monopolies are bad for innovation and competitive pricing.

Henry Blodget reckons that Google is paying most of this 2.5 billion out in network fees. I say he's wrong. Between server fees and advertsing on YouTube and Doubleclick, Google is probably making well over a billion dollars net. Here's the numbers that matter:

- Display advertising is on an annual run rate of over $2.5 billion
- Mobile is on a run rate of more than $1 billion

Here's some more coverage on the Q3 earnings, as if Google really needed anymore bigging up:

- The Q3 earnings call in detail, courtesy of Business Insider
- And the WSJ's take on the Q3 revenue

» RTB is yet to hit the big time here in Europe. But it's proving very lucrative for both advertisers and publishers in the US. In a joint case study released this week by PubMatic, [x+1], DataXu, MediaMath, and Turn, RTB was shown to give publishers a 64% revenue lift - in comparison to other non-RTB inventory on the Pubmatic platform - and a 749% (!) performance improvement for advertisers. Each DSP focused on four specific verticals (automotive, financial, CPG and telcos) over a thirty-day period during August and September, tracking performance by three audience targeting methods. The three methods included: non-RTB. run-of-network; non-RTB, audience targeting; and RTB, impression-level optimization. The full report is available from October 18 - but if you can't wait until then here are some of the headline numbers:

- Publishers generated significantly higher revenue from RTB campaigns in comparison to Non-RTB campaigns, across all advertising verticals, by an average of 64%

- RTB outperformed traditional run-of-network non-RTB media buying methods by an average of 749%

- Audience targeted non-RTB campaigns outperformed run-of-network Non-RTB campaigns by an average of 324%

- Based on cost-per-success metric as outlined by the advertisers for each campaign, RTB provided better ROI than non-RTB audience targeted campaigns by 101% on average