Google AdSense, since its inception in 2003, has supported a dozen-odd ad units – from the 300×250 Rectangle to the 160×600 Skyscraper – that abide by the IAB guidelines. Premium AdSense publishers do have the flexibility of customizing the layout of text-only ads but not the image or rich-media ads.
Last week Google introduced custom-sized ad units in AdSense that blurs the line between Premium and regular publishers. Now all AdSense publishers are given an opportunity to create ad units of custom dimensions, tailor made for their own website. Let me explain.
Say your website has a sidebar that is 250 pixels wide. Previously, you could only choose between the regular skyscraper formats – 120×600 or 160×600 – even though none of these units would perfectly fit inside your sidebar. With custom-sized units now available in AdSense, you can create an ad unit that is exactly 250×600 in size thus taking all the available screen estate. Or if the sidebar is long, you can even choose to have a 250×1200 unit.

Custom-Sized Ad Units vs Regular AdSense Ads

An obvious advantage with custom-sized units is that they better fit the layout of your website. That said, Google algorithms may sometimes override your choice.
For instance, if you have created an ad unit that is 500×300 pixels, AdSense can still serve display ads in standard formats like the 300×250 or 336×280 for that unit. The smaller ad will be center-aligned and the remaining area is filled with whitespace.
Google may display small display ads inside custom-sized ad units.
Google may serve display ads of lesser dimensions inside custom-sized ad units.
Since Google is likely to display the highest performing ad – which could either be a custom-sized unit (that you’ve requested) or a regular unit – it may be a good idea to use custom-sized units in place of regular units as, with the former, you get the best of both worlds.

Convert Existing AdSense Ad Units to Custom-Sized Ads

Google recommends that you create a new ad unit in your AdSense dashboard and choose the option “Custom Ad Size” for creating a new custom-sized ad unit. You can however use your existing Ad units and convert them into a custom sized units.
All you have to do is adjust the width and height values in your existing ad code and regular unit will be automatically converted into a custom sized unit. Just make sure that both height and width values are less than 1200 pixels and that only one of these values is greater than 300 pixels.

Custom-Sized Ads vs Responsive Google Ads

Earlier this year, Google introduced Responsive AdSense ads where the size (read width) of the ad is dynamically specified based on the screen size of the device where that ad is being served. With responsive ads, you can serve a 336×280 large rectangle on the desktop and the same ad slot may serve a 320×100 ad when the page is viewed on a mobile device.
Now that custom-sized ad units are available, should you make the switch to these new units or continue to use the Responsive Ad units.
Google’s official recommendation is:
Custom-sized ad units are fixed sized ad units, i.e., they don’t dynamically change their size or respond to changes in screen orientation. If your site uses responsive design, we recommend that you use a responsive ad unit instead.
You can however still make your custom-sized ad units responsive such that their suggested size changes based on the device size or orientation. In Responsive Ads, you serve ads of a fixed width based on the screen size while in custom-sized ads you specify the maximum width that the ad can occupy. If you can dynamically specify this “maximum” width, your custom-sized ad unit will be responsive as well.

How to Make Custom-sized AdSense Ads Responsive

The AdSense ad units on this website are custom-sized units but they are responsive too. Here’s how you can implement such a thing on your own website or blog:
    

  1. <div id="google-ads-1"></div>
    2. 

  2.  
    3. 

  3. <script type="text/javascript"> 
    4. 

  4.  
    5. 

  5.     /* Replace ca-pub-XXX with your AdSense Publisher ID */ 
    6. 

  6.     google_ad_client = "ca-pub-XXX";
    7. 

  7.  
    8. 

  8.     /* Replace YYY with the AdSense Ad Slot ID */ 
    9. 

  9.     google_ad_slot = "YYY";
    10. 

  10.   
    11. 

  11.     /* Replace ZZZ with the custom height of your Ad Unit */
    12. 

  12.     google_ad_height = ZZZ;
    13. 

  13.   
    14. 

  14.     ad = document.getElementById('google-ads-1');
    15. 

  15.  
    16. 

  16.     if (ad.getBoundingClientRect().width) {
    17. 

  17.         google_ad_width = ad.getBoundingClientRect().width;  
    18. 

  18.     } else {
    19. 

  19.         google_ad_width = ad.offsetWidth; // for old IE 
    20. 

  20.     } 
    21. 

  21.  
    22. 

  22.     /* The width of an Ad unit should be between 120-1200 pixels */  
    23. 

  23.     if (google_ad_width>1200) {        
    24. 

  24.         google_ad_width = 1200;
    25. 

  25.     }  else if (google_ad_width<120) {
    26. 

  26.         google_ad_width = 120;
    27. 

  27.     }  
    28. 

  28.  
    29. 

  29.     /* The height of an Ad unit should be between 50-1200 pixels */  
    30. 

  30.     if (google_ad_height>1200) {        
    31. 

  31.         google_ad_height = 1200;
    32. 

  32.     }  else if (google_ad_height<50) {
    33. 

  33.         google_ad_height = 50;
    34. 

  34.     }  
    35. 

  35.       
    36. 

  36.     /* Both height or width cannot be more than 300 pixels */  
    37. 

  37.     if ((google_ad_width>300) && (google_ad_height>300)) {        
    38. 

  38.         google_ad_height = 300;
    39. 

  39.     }  
    40. 

  40.     
    41. 

  41.     document.write (
    42. 

  42.      '<ins class="adsbygoogle" style="display:inline-block;width:' 
    43. 

  43.       + google_ad_width + 'px;height:' 
    44. 

  44.       + google_ad_height + 'px" data-ad-client="' 
    45. 

  45.       + google_ad_client + '" data-ad-slot="' 
    46. 

  46.       + google_ad_slot + '"></ins>'
    47. 

  47.     );
    48. 

  48.   
    49. 

  49.     (adsbygoogle = window.adsbygoogle || []).push({});
    50. 

  50.  
    51. 

  51. </script>
    52. 

  52.  
    53. 

  53.   <script async src="//pagead2.googlesyndication.com/pagead/js/adsbygoogle.js"></script>
    54.
Go to your AdSense dashboard and create a new Ad unit with the type as “Custom Ad Unit.” You can specify the dimensions as, say, 300×1200 pixels (either the height or width should be 300 pixels or less) and choose a default color and font scheme for the ad unit. Click the “Save and Get code” button to generate the ad code.
Note your AdSense publisher ID, Ad Slot ID and replace those values in the above block of code (line #6 & #9). You should also change the default height (line #12) of your custom sized unit (the width is automatically determined by JavaScript). Copy-paste the modified code anywhere in your web template and the custom-sized ads will fill the available width while being responsive.
The technique will work on both responsive and regular (non-responsive) websites.

Smart-sized Ads vs Custom-sized Ads

Some have pointed out in the comments that smart-sized responsive ads could be a better alternative to custom-sized ad units. Yes, implementing a smart-sized responsive unit is easier (you just have to add data-ad-format=”auto” to the ad code) but the downside is that you do not less control over the ads that will be served.
For instance, if the available ad space is 200 pixels, AdSense may serve a longer 160×600 unit though a small 200×200 square unit could have been a better fit. In that case, an option would be that you specify the height and width of the container div or simply use the custom-sized unit.