Discovery Ads: Hot Iron in the Google Fire?

It was an exciting announcement for advertisers and agencies that Google announced at its annual "Marketing Live" event on May 14, 2019: Discovery Ads will be an entirely new ad format that reaches people at moments when they are open to new products and services.

In the DACH region, the "Closed Beta" for Discovery Ads ran until recently. This means that Google has to activate an account for the use of Discovery Ads. The demand for "whitelisting" was very high, as Google let slip in conversations. Now, Disocvery Ads are available to all as an open beta, according to Google. As Google's premier partner, Ad Agents has been testing Discovery Ads for several customers for some time and has drawn an initial interim conclusion.

What is Google Discover?

The Discover function was launched back in 2016 as "Google Feed". In the form of a stream, as we know it from social networks, the feed is supposed to feed us with news that really interest us. Google's goal was to enable discovery and browsing, primarily via images, in addition to traditional search. In this way, Google responded to the increased need for visual discovery, from which platforms such as Pinterest and Instagram have benefited greatly in recent years.

In 2018, Google further developed the feed into Google Discover as a start tab in the Google app. At that time, the feed already had 800 million monthly active users according to Google and thus offered exciting traffic potential and high click rates, as described by SEO-Südwest, for example. Google currently does not provide any information about current reach.

What are Google Discovery Ads?

Unsurprisingly, the Discovery Ads are ads that are to be played in the Discovery feed. This serves as the start page in the Google app. So much for the theory. In practice, the display in the Discovery Feed in DACH is still a long time coming, at least according to our latest information. But Discovery Ads do not only appear in the Discover Feed, but also on the start page of the YouTube app (Home Feed) and in Gmail (in the social networks and advertising tabs).

The ads are already being played out here in the DACH region. This fact makes the reach of the Discovery Ads incredibly exciting for advertisers. While some may scratch their chins in bewilderment at the term Google Discovery, the popularity of YouTube and Gmail is quickly proven: Gmail is the global market leader as a mail client, according to Statista, and YouTube is one of the most popular, if not the most popular, social media. While Gmail can also be targeted via display campaigns, Discovery Ads make the mobile YouTube Home and, in the near future, the Discovery Feed accessible to advertisers for the first time.

What do Google Discovery Ads look like?

In terms of structure, Discovery Ads are similar to the "Responsive Display Ads" format. They consist of several elements such as images, company logo, title, description and call-to-action. Advertisers enter up to five ad titles and descriptions via Google Ads. The individual components are put together automatically by Google using machine learning. It is also possible to create carousels with multiple images. The primarily visual presentation makes the ads look native in the feed.

Discovery Ads in YouTube Home Feed, Google Discover Feed and Gmail Promotions Tab. (Source: Searchengineland.com)

What is the added value for advertisers?

In principle, discovery ads as a display format are more likely to be classified in the branding category. After all, the keyword is an important indicator for transactional advertising. Instead, the display is controlled via the common Google target groups. These include ready-to-buy and remarketing target groups as well as targeting via interests and demographics. It is no longer a secret that high-performance display campaigns can be implemented using all the information that Google possesses about its users. Accordingly, deals can also be generated via discovery ads.

The fact that currently only target CPA or conversion maximization are available as bidding strategies supports the assumption that Google also wants to use the Discovery Ads as a performance measure. The visual presentation in combination with precise targeting options makes Discovery Ads an exciting mix of push and performance marketing.

How and when can advertisers use Discovery Ads?

Discovery Ads are to be classified as an independent campaign format and are consequently accessed via their own section in Google Ads. As mentioned, this has recently been in open beta and should be available in every Google Ads account. The end of the test phase and official launch of Discovery Ads is expected in spring 2020.

Initial findings on the use of discovery ads

We have been testing Discovery Ads for several months and can draw a positive interim conclusion across several accounts. Compared to classic display campaigns, Discovery Ads impress with better click and conversion rates. Traffic is sometimes purchased at a much lower price and the economic key figures, as suspected, change between the usual values of the two categories branding and performance.

However, the strong click figures should be taken with a grain of salt. A large part of the traffic probably still runs via Gmail, since it is also played on the desktop. However, opening the ad in Gmail is counted as a click here, not the forwarding to the provider's site.

Unfortunately, there are only a few control and monitoring options so far, as many options are not (yet) available. For example, Google does not indicate how the traffic and other KPIs are distributed across the various playout locations.

Conclusion: Google Discovery Ads is a force to be reckoned with

With Discovery Ads, Google has launched an exciting format that can be classified as a display measure, but also has performance components. The visual presentation and inspiration in a browsing phase is typically classified as "top of the funnel". However, the precise targeting and the performance-oriented bidding strategies also make discovery ads a conclusion-oriented measure.

The connection to YouTube and Gmail brings attractive reach, and setting up campaigns is quite easy thanks to the automated compilation by Google. Even if no current reach figures are available for the Discovery Feed and playout in DACH is still faltering, the mobile Google Feed is certainly a channel with a future. However, in order not to leave Discovery Ads to the black box Google and to be able to optimize the campaigns manually, more detailed reports are desirable.