Today Google announced the launch of its new ad product – Google DoubleClick Ad Exchange, which will open up both advertiser and publisher inventory and allow market dynamic-driven pricing and greater scalability with respect to audience reach for advertisers and access to a wider swathe of advertisers for publishers.
But this is Big G, and if there’s one thing it knows and dominates, it’s online advertising. Getting a sizeable exchange going can often present a chicken-and-egg problem, but Google’s reach among publishers and advertisers (DoubleClick for the head, AdSense/AdWords for the long tail) is already impressive, at 76% of the US and 73% of the global online audiences.
Exchanges, on the other hand, comprise about 10-15% of the display ad business (Yahoo’s Right Media Exchange is the largest). Google will shave off a relatively small fee through the exchange, but what it will gain is access to inventory sources if the exchange grows and dominates. If it can maintain higher efficiency than its competitors, Google will grow its share of a market that it will host and develop.