Header bidding is a programmatic technique leveraged by publishers that offers inventory to multiple ad exchanges at the same time before making calls to their ad server. The technology unites all publishers’ header bidding demand sources into one unified auction. This means that for every impression, on every ad unit, on every page, there is an auction that includes all header bidding demand sources. The unified auction results in the highest bidder winning the impression. A header bidder driven programmatic strategy changes programmatic/ad ops in many ways.
Since every demand source has the opportunity to bid, it is no longer necessary for a publisher to create a pass back waterfall. Passbacks become irrelevant, and setting price floors becomes obsolete. The bidding price for each piece of ad inventory now reflects the market’s highest value, as opposed to what an antiquated ad server setup would yield. Header bidding solves a publisher’s problem: the loss of programmatic revenue because of inefficient ad serving technology. And header bidding solves a buyer’s problem: the need for access to a publisher’s best inventory. Header bidding is the ultimate optimization for both buyers and sellers. Below are the pros and cons of header bidding, along with a list of vendors offering this technology:
Pros of Header Bidding
- Eliminate pass backs – With a header bidding integration, pass backs are no longer required since demand sources will only win an impression with the highest bid.
- Flatten your waterfall – The outdated concept of a waterfall is no longer necessary since all demand sources are bidding in a unified auction.
- Reduce discrepancies – By flattening the waterfall and removing pass backs, publishers’ ad tech stack is more efficient.
- Better yield management – Yield management no longer needs to be a guessing game. All demand sources can compete on the same playing field, driving up competition.
- Increase revenue –With the flattening of the waterfall, increased competition, and unified auctions, publishers make more revenue. Publishers save on the ad serving fees paid on pass backs, monetize inventory lost to discrepancies, and earn the highest bids for their inventory.
Cons of Header Bidding
- Development Resources – Header bidding requires a skilled development team, as well as a savvy programmatic ops team.
- Potential for Discrepancies – The longer page load time has been known to create unforeseen ad serving discrepancies.
Header Bidding Demand Sources/Technology
Here are the demand sources we’ve identified that have efficient header bidding technology:
Google is noticeably absent from the list; however, when publishers leverage DFP as their ad server, they can allow both Google ADX and Adsense to participate in the unified auction by leveraging dynamic allocation to compete against all header bidding demand – in real time.