Example of unified pricing

What is Unified Pricing in Google Ad Manager?

Neera Shanker Ad Monetization

Back in 2019, Google transitioned to a newer unified pricing model for Google Ad Manager. For some publishers this was good news, and for others, not so much. Then there are the ad tech individuals who are still trying to understand what it even means.

In this article, we’re going to dive into unified pricing in Google Ad Manager to give you a better understanding of its implications.

What are the Unified Pricing Rules?

Unified pricing is designed to function as a centralized floor price management system for a publisher’s inventory on Google Ad Manager. Unlike the previous ways of pricing, all inventory coming from indirect demand sources can now be controlled with the same rules under the single panel within Google Ad Server.

What this means is that the rules for all auction pricing are applied to every bidding channel. That includes open auctions, private auctions, and even first look auctions.

Initially, Google Ad Manager used a second-price auction model. The Google Ad Manager platform had originally allowed publishers to create their own pricing rules to keep buyers from gathering impressions for less-than-worthy CPMs. However, with the new model, once a pricing rule is set, any bids below the pricing floor are completely ignored during the auction.

For example, without the set floor price, if one bidder offered a $6 CPM and another bidder responded with a $2 offer for the same impression, the winning bidder would only have to pay $2.01 — despite having put in a higher offer.

Having a set floor price means that the minimum bid cannot fall below that floor. With a set floor price of $4, the winning bid from the above example would have been $6.01.

Additionally, with second-price auctions, floor pricing could be set across all bidding platforms. However, the rules would vary slightly meaning that the same impressions would be placed at different values.

With unified pricing, there’s a first-price auction model which allows publishers to set the same floor price across various platforms such as AppNexus, OpenX, Smaato, LiveIntent, etc. Now publishers don’t have to worry about setting up a bunch of different rules for bidding.

Unified pricing now applies to the following direct demand channels:

  • Open bidding (traditionally referred to as Exchange Bidding)
  • AdX open auction
  • Private auctions
  • First look pricing auctions
  • Price priority, network, and bulk line item types

However, unified pricing rules do not apply to the following:

  • Programmatic direct campaigns. This includes programmatic guaranteed — standard and sponsorship — as well as preferred deal line items.
  • AdSense backfill.
  • House line item types.
  • Line item types with a zero rate and no value CPM set.

Dealing with the Overlapping Rules

Another change that publishers have to deal with for the new unified pricing, is how Google Ad Manager prioritizes its overlapping pricing rules.

Unlike the old pricing rules, with unified pricing, the higher floor prices or targeted CPMs are prioritized. That means for any two unified pricing rules, the rule with the higher floor price is applied to the line items. This goes for overlaps between first look and one unified pricing rule, or one open auction pricing rule and one unified pricing rule, and so on.

Here’s how overlapping rules are prioritized:

  • For the two rules targeting the same inventory, the one with the higher floor price is prioritized (as mentioned above).
  • For unified pricing and open auction rules applied to the same inventory, the higher floor price also applies.
  • For unified pricing and first look pricing applied to the same inventory, the higher floor price applies here as well.

New Limits to the Inventory

Of course, with newer pricing rules come new limits. Here are the new rules that publishers have to follow with the new unified pricing model:

  • There can only be 200 unified pricing rules (UPRs) per network.
  • In terms of type settings, only Target CPM and Fixed CPM are allowed to be set.
  • In terms of scope rules, only the advertiser and buyer-specific rules are applicable — and only for EBDA and AdX traffic.

Advantages and Disadvantages

While the new unified pricing model can undoubtedly work in the publishers’ favour, it still comes with both advantages and disadvantages.

Here are the advantages:

  • Unified pricing simplifies the entire operation – Rather than having to maintain price floors individually among all the different platforms, all of the price floors can now be managed in one single place.
  • More transparency and better-informed buyers – Since the access and floor pricing are consistent across all platforms and partners, buyers can plan their bids better since they have a better idea of what publishers expect.

Here are the disadvantages:

  • There’s a rule limit – As mentioned earlier, only 200 UPRs can be activated per network. This can be a challenge for enterprise-level publishers with pages in the millions or billions.
  • There’s a per-buyer limit – With the new changes, it isn’t possible to set a per-bidder floor price. Therefore, all floor pricing remains the same for all DSPs.
  • There are targeting and blocking limits – Google has done away with anonymous pricing which means priority rules can no longer be set. Therefore, only buyers like AppNexus can target advertisers and brands.

How to Exclude Inventory from the Unified Pricing Rules

If you find that as a publisher, the disadvantages outweigh the advantages, you can exclude your chosen inventory from the unified pricing rules.

Here are the steps to exclude your inventory:

  1. In Google Ad Manager, click on the Protections tab.
  2. From there, select the New Protection > Inventory Exclusion.
  3. Create a name for your protection.
  4. Now set your targeting and inventory type to demonstrate the Open Auction Pricing rule. The rule types here are Display, Mobile App, In-Stream Video, and Games.
  5. Click Save so the rules will show up in the Rules Tab.

While the new unified pricing rules give publishers the advantage, it still takes away the power from server-side platforms (SSPs). With first-price auctions, Google essentially has all the power, which is why so many people in the ad tech industry are still trying to understand these new rules so that they may someday be able to work around them.

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