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Alphabet Inc and Facebook Inc. Partner, and Compete, to Make Ads Better

Facebook Inc, Netflix Inc are still a buy despite market

Alphabet Inc ,  is the leader in the online ad space. Both it and Facebook Inc. have a strong dominance in the market. Any action from either company ripples throughout the digital ad industry. It it no wonder why the two online giants seem to be slowly partnering their platforms. But Google seems to have a plan that could revolutionize the way the entire industry looks at ad impressions.

Facebook Inc, Netflix Inc are still a buy despite market

This week it was announced that Facebook had incorporated the Alphabet search giant into its own search facility. The mutual benefits of a venture like this are probably obvious. Converging the world’s largest social platform with the largest search engine is bound to shuffle great amounts of user generated cash into the pockets of both firms.

Get Facebook Info Via Alphabet Inc’s Google

According to a WSJ, Alphabet Inc can now index items via Facebook’s Android app. As of Friday, when users conduct a Google search on an android device and clicks on a listing that links back to the social network, they will be redirected to the relevant page within Facebook’s app.

The move should strengthen Google’s usage on mobile devices. Facebook, too, stands to gain with more people landing on the its pages via Google searches.

Google held almost a third of the world’s online ad sales in 2014. Facebook Inc had a 7.75 percent global share over the same period. Partnered, the two hold a definite dominance over digital ads. Since both firms are extremely mainstream, it would be difficult for rivals to deviate without risking huge losses. So, Google and Facebook are positioned to set the ad space standard.

New Ad Impressions from Alphabet

Now Alphabet is about introduce a feature that will change the way ad buyers pay for online ads and how websites profit from them. Instead of only charging for online ad placements, Google intends to charge advertisers for ads that are actually seen.

This might seem obvious, but it doesn’t always work that way. Most websites are paid according to the amount of traffic they generate. It works the same for television ads. On TV, ad slots are priced according to show ratings. The problem with this it that advertisers are charged based on these ratings with no distinction between viewers who’ve actually seen their ads and those who’ve not.

Digital ad impressions work quite the same. An advertiser pays whenever a page is loaded. Regardless of whether the viewer had actually scrolled down and saw the ad or not, if the ad was on the loaded page, the advertiser gets charged. Bearing this, it is likely that a great number of ads in poor ad spaces, like the bottom of a webpage, are not actually seen but still cost the advertiser as if they were.

“Most display ads – 56%, in fact – never had a chance to be viewed because they were below the fold, scrolled out of view, or in a background tab. Soon, we’ll make the GDN one of the only media platforms where advertisers don’t pay for an ad impression inless it was viewable. This means your media dollars will only be spent where they can have an impact.” – Google

The move has analysts anticipating a change in how digital ads will be marketed. “When Google does this, it should affect every other website that sells ads,” writes the Motley Fool. A move like this from the industry’s leader is bound to cause advertisers to better consider the viewability of their ads. Alphabet Inc fairer, more assuring option is likely to be adopted by most webpages, too

Facebook Inc also recently began offering similar ad options to those who advertise on the social network. The system seems fairer on the surface and will draw in large numbers of advertisers who want to know they’re paying their money’s worth for ad impressions.

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