Ad Buyers Dismiss Google's Claim of 5% Ad Price Hike as 'Too Low'

Inflation during search auction can exceed 100%

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Google’s admission to quietly inflating ad auction prices up to 5% for search advertisers, potentially increasing them by 10% for some queries, during the U.S. v. Google antitrust trial comes as little surprise to ad buyers.

According to industry execs, the 5% figure is viewed as rather conservative, and the actual inflation rate could be considerably higher.

During the trial’s second week, Jerry Dischler, Google vp and general manager, admitted to changing the search ads and reserve pricing by as much as 5% to meet revenue targets.

“[Google] claiming 5% is a more conservative number to make it sound like the natural ebb and flow of a marketplace,” said Christine Yang, vp of media at Iris.



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