How to Maximize Ad Revenue with Google DFP

In order to maximize revenue from display advertising, the best thing you can do is sell your ad inventory directly to targeted advertisers willing to pay a premium rate. Of course, many publishers don’t sell all of their inventory directly and instead rely on network partners to monetize remnant inventory. Monetizing this unsold inventory is a major component of online monetization; optimizing the yield here can have a huge impact on your bottom line, especially if you have a significant base of existing traffic.

Many publishers find that there are often several pieces of low hanging fruit that can be picked in order to boost revenue. It’s not uncommon to add a few dollars to your total page RPM through the optimization practice. On a site generating getting 500,000 pageviews monthly, each $1 uplift in display ad RPM means a $500 increase in profit.

Multiple Networks

While many publishers rely on a single ad network (most commonly Google AdSense) to fill their unsold ad inventory, there is potential value in having multiple ad networks compete for your business. The benefit of this approach should be obvious: more competition means that you’ll earn more revenue if you’re able to only serve the highest yielding ads. As discussed below, this is much easier said than done.

Ad Network Competition

Using DoubleClick for Publishers (DFP) Small Business, the free ad serving platform offered by Google, it’s possible to have multiple ad networks targeted at a single ad unit. The goals here are to: 1) avoid missing out on impressions (i.e., a 100% fill rates) and 2) always serve the ads that will generate the highest revenue.

First off, if you have an AdSense account, you’re already approved for DFP Small Business. There are other ad serving platforms that can be used to run your display ads, but we’ve found DFP to be the best (especially for the price).

In this example, suppose we want to target a 300×250 ad unit with ads from four different networks :AdSense, Media.net and Kontera. Within DFP, follow these steps to get these line items competing:

1.      Create new Orders for the non-AdSense networks (i.e., Media.net, Chitika, and Kontera).

2.      Within each Order, create a Line Item targeting the desired ad unit.

3.      Set the Type to “Price priority” and the Limit to “None.” Select the option to enter in a Value CPM, and then input the approximate eCPM that the ad network yields. (More on this below.)

4.                  Upload the ad tags, and save the line item.

5.      Within DFP, click on the “Inventory” tab and find the relevant ad unit.

6.      Enable AdSense for the ad unit:

This final step brings AdSense into the equation; if DFP determines that AdSense can beat the “Value CPM” you entered, it will prioritize those ads.

Manual Problem

The obvious problem with this approach is that you need to know the CPM that each ad network generates for you. Because most ad networks work on a CPC system–meaning that revenue is earned when an ad is clicked and not necessarily just when it is displayed–you need to run ads from the network for a while in order to figure out the effective CPM these networks can deliver.

So this process is essentially telling DFP which ad networks make the most money for you; it will fill any ad requests with ads from that network if available, and then move on to any lower performing ad networks if an ad is unavailable (i.e., if you can’t get 100% fill rate from your desired network). In order to get to the point where you know which ad networks make the most for you, you’ll need to do quite a bit of experimentation. For example, you might run each network in this ad position for a week at a time, and come up with results like:

Network	Impressions	Earnings	RPM
Network #1	250,000	$500	$2.00
Network #2	200,000	$500	$2.50
Network #3	300,000	$300	$1.00

Now you’d know the “Value CPM” for input into DFP (the far right column in the above). You’d basically be telling DFP to prioritize the code from network #2, unless AdSense can beat that $2.50 figure.

This is less-than-ideal for several reasons. Effective CPMs from ad networks are rarely static, often varying quite a bit from month to month and even day to day. So in order to make sure that you’re prioritizing the right ad networks, you’ll need to be regularly updating DFP with the latest eCPM figures. That involves a lot of administrative work, and can quickly become overwhelming and frustrating.

In other words, the process described above is a pretty crude and sub-optimal solution.

Having multiple ad networks compete remains a generally time-consuming process (though we’ll get to some of the higher tech solutions below). For most publishers, this process will consist of:

1.      Testing multiple ad units in order to estimate RPMs that can be expected from certain placements

2.      Telling DFP (or other ad serving platform) to prioritize the networks with the highest expected payouts

Ideally, the server would be able to update the expected RPM automatically, interacting with the networks in order to get new yield information on a regular basis. With most of the free products out there, however, that’s not a possibility (at least not yet).

Higher Tech Solutions: Ad Exchanges

Unfortunately, in 2014 there isn’t a cheap and easy solution for publishers looking to maximize yield from multiple ad networks. It’s not just a matter of changing a setting in AdSense or DFP; this type of optimization will require quite a bit of research, and likely an upgrade to a paid premium service.

If you want the display ad optimization process to be more efficient and optimized, the freebie services like DFP Small Business probably aren’t going to be enough. You’ll need to look into more advanced ad solutions that generally involve real-time bidding platforms and ad exchanges that can integrate with multiple ad networks and different types of ad buyers to produce a higher payout.

Ad Exchange Defined

In order to understand how these types of platforms work, it will be helpful to define some terms:

Ad Exchange. This refers to a platform that lets publishers hold auctions for their display ad inventory. Just like a stock exchange, there are “seats” on an ad exchange that can be held by different types of buyers (e.g., networks, individual brands, etc.). Being involved in an ad exchange will generally allow / require publishers to set a floor price for their inventory and determine who is able to bid on their inventory. Google’s DoubleClick Ad Exchange is one of the largest options here.

Programmatic Buying (or just “Programmatic”). This term refers to leveraging big data to formulate a quantitative, rules-based marketing strategy. That can include determining the “value” of an ad impression served to different types of visitors (utilizing the increasingly advanced data available to provide some basic information about visitors to a site) and bidding on inventory across multiple mediums accordingly.

Real Time Bidding (RTB). Though real time bidding and programmatic are sometimes used as synonyms, they are different concepts. Real time bidding is one type of programmatic buying, where advertisers submit bids for ad impressions under an auction-based system. “RTB’s key benefit is providing buyers with access to real-time inventory at scale — at a price those buyers want to pay.” Programmatic buying, he notes, is a larger scale marketing effort driven by data and algorithms (and guided by a human element). Programmatic buying can be used by marketers who don’t empty RTB strategies and can be used in other mediums as well.

In other words, programmatic buying refers to the process of leveraging big data to generate algorithms and rules for buying advertisements. Real time bidding refers to the process by which many programmatic buyers procure their desired media.

AdSense vs. Ad Exchange

For publishers looking to get more advanced in their ad monetization, there are a few big ad exchange platforms out there. Pubmatic and Rubicon are both big names, but we’ll focus on the DoubleClick Ad Exchange for purposes of this article (since it’s part of the Google product suite that many publishers prefer).

At first glance, it can be difficult to understand how an ad exchange is any different than networks such as AdSense. The major distinctions are:

·         Ad exchanges allow publishers to set a desired price for their inventory. Think of this as a minimum bid amount.

·         On some ad exchanges (such as DoubleClick), bids are on a CPM basis. Conversely, AdSense generally works on a CPC basis (meaning advertisers only pay when their ads are clicked).

·         Ad exchanges probably won’t give you a 100% fill rate (if no buyers submit bids that meet your minimum) whereas AdSense has a basically unlimited supply of ads.

·         Ad exchanges have multiple “seats” occupied by different buyers. These buyers can include networks (such as AdWords) as well as individual brands or agencies. While Google buys a decent portion of the available inventory on Ad Exchange (through AdWords), there are other networks involved here as well.

If you’re interested in having multiple ad networks compete for your ad inventory in an automated, real-time fashion, your best bet is probably looking into an ad exchange. If you feel like you need to get a bit more information to understand your options, check out the additional resources below.

Bottom Line

Leveraging multiple ad network partners is a key part of maximizing your display ad earnings. Doing so allows publishers to serve a greater number of ads (since many networks have a limit on the number of placements per page) while also breeding some healthy competition. But the process of managing multiple ad networks through the most popular free ad serving platforms remains a very manual process. If you want to truly have a live auction from multiple networks for your ad inventory, higher tech (and more expensive) solutions are required