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How Google Is Using Machine Learning to Improve Auto Ad Results

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Google’s AdSense Auto Ads is now live

Alphabet’s (GOOGL) Google is offering an optional update to its AdSense system, in which Web publishers can choose the ads they want to display and the best places to put them. The AdSense Auto Ads service was launched in September 2017 in a limited beta, but it is now live for everyone.

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Features of AdSense Auto Ads

Google’s Auto Ads feature uses machine learning to improve results and find unused ad space where publishers can place their ads. Publishers need to select one piece of code in the “my ads” section of their AdSense account and paste it on the header tags of the pages on which they want to place their ads. The system will automatically set the appropriate number of advertisements in the ideal position on the page. Publishers won’t need to remove their existing, manually-placed ads to use it.

According to the test results, Google could see an average of 10% year-over-year growth in revenues from participating publishers. The AdSense system is currently used by tens of millions of Web publishers. The new auto ads feature is expected to boost the benefits of Web publishers.

Advertising revenue growth

Google mainly contributes to Alphabet’s ad revenues. In 4Q17, Alphabet generated around $27 billion of ad revenues. Other than Google, social media companies Snap (SNAP), Facebook (FB), and Twitter (TWTR) also rely on advertising for most of its revenues.

In 4Q17, Snap’s advertising revenue accounted for 98.4% of the company’s overall revenue, while Facebook’s advertising accounted for 98.5% of its total revenue. Yelp’s (YELP) advertising represented 95.5% of its revenue for the same period. Twitter and Alphabet earned 84.2% and 88% of their revenues, respectively, from advertising sales in 4Q17.

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