News

POV: Google gets FBx access

MINDSHARE POINT OF VIEW – Google’s Demand Side Platform (DSP) DoubleClick Bid Manger (DBM) is joining Facebook’s Real-time bidding exchange, FBx.

Background

Google’s Demand Side Platform (DSP) DoubleClick Bid Manger (DBM) is joining Facebook’s Real-time bidding exchange, FBx. From Q1, advertisers using the Google service will be able to benefit from the huge pool of inventory that Facebook provides, using both marketplace ads (found on the right hand side of the page) and newsfeed ads (linking offsite). FBx is an exchange where inventory is bought though a DSP using cookie data but not Facebook data, and is an increasingly big player in the advertising ecosystem.

Details

Facebook first released FBx in September 2012, however Google’s DSP was conspicuous by its absence and so it was assumed that Facebook did not want to help Google further dominate the advertising landscape and give access to its data. This however was an issue for advertisers and agencies that used Google’s platform as their only DSP, who then had to use an additional platform to access Facebook’s exchange.

Speculation is rife that the sudden partnership has stemmed from Facebook’s purchase of the adserving platform Atlas, which would benefit from cooperation with the industry’s biggest player, Google. In addition, the recent purchase of the social technology platform Wildfire by Google (article) and integration into its DoubleClick stack provides another reason for partnership, as advertisers and agencies look to measure the effectiveness of social.

Implications

It will be the current users of DBM who will be able to reap the benefits of the new partnership the most, as they will now be able to buy Facebook inventory without using multiple DSP partners. It should also boost Google’s business in the ecosystem, but has the potential to have the opposite effect on DSPs heavily focused on FBx who will now have to expand their offering to compete.

Cost per thousand (CPM) has declined recently on FBx (20% drop January to March), but they are expected to increase when another major player enters the market creating more competition. However, CPMs across Facebook’s exchange are typically lower than on rival exchanges, so it is unlikely this will put buyers off.

Summary

Having a more open ecosystem can only be a good thing for advertisers and so it is refreshing to see partnership between two major rivals. The deal should also generate revenue for both players (although Facebook will take a bigger cut as the publisher) and so it is win-win for both.

Read the DoubleClick Blog announcement here: http://doubleclickadvertisers.blogspot.co.uk/.