Are Custom Brand Exchanges the Future?

Programmatic ad buying is capturing more attention and a bigger portion of the digital marketing budget. Industry experts note that the programmatic market has been doing particularly well in terms of direct response money. At the same time, there’s been growth in private exchanges. Now, Google businessmeetingwants to change everything and create a ‘custom brand exchange’ that will allow it to serve “as an intermediary between high quality publishers and the upper echelon of advertising options in a demand-​driven market," according to a post by Corey Pollack on Wave Digital Media.

Pollack referenced a recent Ad Age article on this topic. Google’s goal is to put a new twist on the private publisher exchanges that are now cropping up in the programmatic buying market. The idea behind Google's brand exchanges is to allow marketers to buy inventory available at publishing sites and be assured of placement on a quality page as it appears before a consumer.  Google’s algorithms will work behind the scenes to display ads to the right targets in real time.

Aaron McNally, market development manager at Google-​owned DoubleClick Ad Exchange says, "We're trying to create effectively a curated network for these advertisers using the best inventory these publishers have to offer." The company has already had success with a couple of major automotive brands. These brands were shown which publications would work best for them in advance. Those brands bought the digital space as recommended and were pleased with the results. Experts expect more major brands to follow.

What’s not so easy to predict is how media publishers will feel about this arrangement in the long term. One media buyer involved in the process noted that the marketers in this study would have purchased ads on the specific publisher sites from the direct sales team, anyway. That dilemma brings up the question of cannibalizing sales.

If the new exchanges grow more popular, Google wins because they will have inserted themselves as a value-​adding partner to the process.  Do you think this trend will expand beyond a few marketer leaders who are working with large ad budgets?

Kathy Crosett
Kathy is the Vice President of Research for SalesFuel. She holds a Masters in Business Administration from the University of Vermont and oversees a staff of researchers, writers and content providers for SalesFuel. Previously, she was co-​owner of several small businesses in the health care services sector.