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Google goes to first-price auction : The consequences

Google goes to first-price auction : The consequences

Google’s move to a first-price bid changes the dynamics of the publisher stack and redistributes publishers’ revenue across all used channels. This is an indirectly negative impact on Header Bidding that is observable.

Indeed, the share of the budget captured by Google’s exchanges in campaign budgets will increase. They will spend more on Google Ad Manager, but less elsewhere. The American firm regains its monopoly. If they spend more through the ad manager, they will spend less elsewhere. If Google Ad Manager wins more impressions, it will reduce the flow of funds for Header Bidding.

This will translate concretely into declining revenues from SSPs: With commission fees through Ad Manager, CPM offers will be reduced because of these commissions. Publishers need to re-evaluate their configurations and relationships with Header Bidding partners, and via Exchange Bidding.