How Will Google Ads' Real-Time Bidding Changes Impact Your Ad Monetization Strategy?
Explore Google Ads' shift to real-time bidding for app inventory & its impact on mobile advertising. Learn how to adapt & optimize strategies.
Jovan Ristic

Google Ads has recently announced a significant change to its ad auction system. The company is shifting its focus primarily to real-time bidding (RTB) for app inventory, which may considerably impact the mobile advertising landscape.

Along with the transition to real-time bidding, Google Ads will discontinue support for multiple calls in mediation starting October 31, 2023. This change will affect how ad auctions are conducted and how advertisers and publishers interact with the platform.

This article aims to explore the implications of these changes for mobile ad monetization managers and provide insights on how to adapt and evaluate strategies having Google’s update in mind. By understanding the changes and their effects, ad monetization managers can better navigate the evolving mobile advertising ecosystem and continue to drive growth and success for their businesses.

What Changes is Google Introducing?

Google Ads is shifting its focus from the traditional waterfall buying approach to real-time bidding for app inventory. This transition marks a significant change in the way ad auctions are conducted and how advertisers and publishers interact with the platform. Google Ads justifies this change with their wish to increase efficiency and competitiveness in the mobile advertising landscape.

The timeline for these changes starts with Google Ads discontinuing support for multiple calls in mediation on October 31, 2023. Prior to this date, the platform may begin transitioning away from waterfall buying for some multi-call requests. This gradual shift provides advertisers and publishers with time to adjust their strategies.

Google says its goal in making these changes is to create a more efficient media buying process for its partners. As they explain, by shifting to real-time bidding, the platform aims to help advertisers find the best-priced app inventory in a more streamlined manner while increasing competition within the real-time auction. This move aims to optimize ad placements and improve ad performance, potentially leading to a healthier ad-supported internet for users and businesses alike.

What is Real-Time Bidding?

Real-time bidding (RTB) is a programmatic advertising technique in which ad inventory is bought and sold on a per-impression basis through an instantaneous auction process. When an ad request is made, advertisers submit bids for the ad impression in real-time, and the highest bidder wins the opportunity to display their ad. This process occurs within milliseconds, ensuring that the ad is served seamlessly to the user.

Real-Time Bidding Explained

In contrast, waterfall mediation is a sequential ad request process where ad networks are prioritized based on historical performance or predefined CPM rates. An ad request is sent to the first ad network in the list, and if no ad is available or the network doesn't meet the specified criteria, the request moves down the list. Waterfall mediation can offer a predictable and structured approach to ad serving, which can be advantageous for some publishers.

Both real-time bidding and waterfall mediation have their benefits and drawbacks for advertisers and publishers. For advertisers, RTB can allow for more precise targeting and potentially efficient spending, as they can bid on individual impressions based on the value they assign to specific user segments. This can result in more relevant ads being served to users, which may lead to higher engagement rates and better return on investment (ROI).

Waterfall Mediation Explained

For publishers, RTB can, in theory, help maximize the value of their ad inventory by exposing it to a larger pool of potential advertisers, which may increase competition and drive up bid prices. This can result in higher eCPMs and overall ad revenue. The real-time nature of the bidding process also ensures that ad space is filled quickly and efficiently, minimizing the number of unsold impressions.

Conversely, waterfall mediation allows publishers to maintain more control over their ad inventory, as they can prioritize networks based on their preferences or relationships. This method can provide a more predictable revenue stream and enable publishers to optimize their ad stack to meet specific goals.

What are the Benefits of Real-Time Bidding?

By increasing competition for their ad inventory, publishers can potentially receive higher bid prices and improve their overall ad revenue. Moreover, the real-time nature of the bidding process ensures that ad spaces are filled quickly and efficiently, minimizing the number of unsold impressions. This streamlined approach can reduce mediation management overhead and improve ad ops efficiencies for publishers. 

On the other hand, the experiments that we at GameBiz have done over the years, as part of our case studies, show that bidding is not always the best way to go. Manual waterfall management enables publishers to specify at which price they will sell their inventory. On the other hand, RTB technology does not support this option, leaving publishers with less control which sometimes results in lower eCPM, ad revenue, and ad ARPDAU.

For advertisers, the move to real-time bidding and the integration with third-party app monetization platforms offer several advantages. Access to a broader range of quality app inventory in real-time allows them to target their campaigns more precisely and optimize their ad spending. 

By participating in real-time auctions, advertisers can bid on individual impressions based on the value they assign to specific user segments, potentially leading to more relevant ads, higher engagement rates, and better return on investment (ROI). 

However, it's important to note that the benefits of real-time bidding might not be applicable to every publisher or advertiser, depending on their specific goals and business models.

Integration with Third-Party App Monetization Platforms

Google Ads is expanding its real-time bidding integrations with select third-party app monetization platforms. These platforms include MAX by (AppLovin), Unity LevelPlay by ironSource, FairBid by Digital Tribune, and Helium by Chartboost.

The integrations with these mediation platforms are moving to an open beta phase. During this phase, the integrations will be available to all app developers using the aforementioned platforms. The open beta allows Google Ads to refine and improve the integrations, as well as gather valuable feedback from developers and advertisers, before making the feature widely available.

The integration of Google Ads with mediation platforms offers several benefits for both advertisers and publishers. For advertisers, it increases the reach of their campaigns across different platforms, enabling them to access a wider range of users and improve their overall campaign performance.

For publishers, the integration can simplify their ad mediation process, reducing the overall management overhead and improving ad ops efficiencies. By adding Google's demand into their bidding strategy, publishers can increase competition for their inventory, potentially driving up bid prices and resulting in higher revenue. In addition, this integration allows app developers to access Google's demand via real-time bidding, even if they are not using AdMob or Ad Manager mediation by Google.

How to Prepare for This Change?

As a publisher using Ad Manager, you can consider adopting real-time bidding solutions to access Google Ads demand. One option is to use Ad Exchange in bidding with Ad Manager yield groups. Ad Exchange includes demand from Google (Google Ads, Display & Video 360) and third-party ad sources. This solution allows your ad sources to compete equally in a single, unified auction, ensuring that the highest-paying advertiser serves the ad for a given impression.

For publishers using AdMob, there are several real-time bidding options available. You can use AdMob Network in bidding with AdMob mediation, which includes demand from Google (Google Ads, Display & Video 360) and third-party ad sources.

The majority of mobile game publishers are probably not using mediation products by Google. However, with the latest announcements, it’s now clear that these publishers can also leverage Google bidding since the product has moved into the open beta stage. 

Our recommendation is to extensively test waterfall vs. hybrid and potentially in later stages bidding-only setups in order to see the potential effects of such changes in advance. In many cases, AdMob by Google is making a significant portion of the revenue for publishers, which means they have to be careful when making changes to those setups.

Adapting to these changes may be important for publishers looking to stay competitive and navigate the evolving mobile advertising landscape. By exploring and adopting real-time bidding solutions, publishers can potentially increase competition for their inventory, optimize ad placements, and improve overall performance. 

However, it's essential for publishers to carefully evaluate the benefits and drawbacks of different real-time bidding solutions to determine which approach best aligns with their specific needs and goals. By staying informed and proactive, publishers can make informed decisions and successfully navigate the changes brought about by the shift to real-time bidding in Google Ads.

Navigating the Google Mobile Ad Monetization Changes

 In summary, the shift to real-time bidding and the discontinuation of multiple calls in mediation by Google Ads present both challenges and opportunities for publishers and advertisers. While this transition may require adjustments to existing strategies, it also offers the potential for increased competition, improved efficiency, and optimized ad placements.

Ad monetization managers should stay informed about these changes and be prepared to adapt and optimize their strategies accordingly. By embracing new solutions and carefully evaluating the benefits and drawbacks of real-time bidding, they can continue to maximize revenue and effectively navigate the evolving mobile advertising landscape.

The move to real-time bidding and the integration with third-party app monetization platforms can unlock new opportunities for increased reach and revenue in the mobile advertising space. By staying proactive and leveraging the advantages offered by these changes, ad monetization managers can ensure their continued success in an ever-changing industry.

The experienced team of ad monetization experts at GameBiz Consulting can guide you through the process, assisting you in evaluating the best solutions for your specific needs and goals. Reach out to us today to learn how we can support your transition to real-time bidding and help you unlock new growth opportunities in the mobile advertising space.

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