Automation has undoubtedly caused a seismic shift in the way business operates. Integrating advanced technologies has redefined industry standards, and companies must adapt to stay competitive in the rapidly evolving landscape.
For example, in the digital advertising landscape, programmatic advertising has revolutionized how advertisements are bought and sold, using technology to automate the process and deliver targeted, data-driven campaigns. This has only been further compounded by the emergence of ‘Header Bidding,’ which offers a more streamlined and efficient way for publishers to monetize their inventory and for advertisers to reach their desired audience.
A recent study showed that header bidding led to a 23% increase in fill rate and a 20% increase in average CPM. With these benefits and more, it’s no wonder why header bidding has become a popular and essential tool for publishers looking to maximize their monetization potential.
What Is Header Bidding and How Does It Work?
Header bidding, or pre-bid or advanced bidding, is a programmatic advertising technology. It is a real-time programmatic auction where multiple demand partners bid on a single impression.
Header bidding allows publishers to offer their ad inventory to multiple SSPs (Supply-Side Platforms), ad networks, and ad exchanges to bid before sending the bid call to the ad server. This results in a more competitive and transparent bidding process, as demand sources compete against each other for the same inventory in real-time.
Behind the Scenes:
What’s interesting to note here is that all these auctions happen while the page loads on the user’s browser. And as soon as the page loads, the aim is to display the ads at the required places.
Benefits of Header Bidding
Before header bidding, publishers and advertisers relied on the ‘Waterfall or Daisy-Chaining’ method to buy and sell media. In waterfall, a series of demand partners sent ad requests, each given a priority based on their past performance and the estimated value of the ad inventory. So, if a demand partner sitting at level 1 cannot fill the ad request, the bidding call will go to the next bidding partner sitting at level 2. The bid request will keep on moving down until it is sold off.
As the bid request trickles down the hierarchy, it often results in a slow and inefficient process, with many ad impressions going unsold. Also, as the partners are arranged based on their past performances, it might happen that a bidder who is willing to bid more but is sitting at level 2 or 3 might never get a chance to bid. The method lacks transparency and limits the ability of publishers to earn maximum revenue.
Header bidding evolved as a replacement for the waterfall method and brought great relief to the users as it allowed:
- Increased competition: Header bidding allows multiple demand sources to bid on the same inventory simultaneously, leading to increased competition and higher CPMs for publishers.
- Improved transparency: It provides greater visibility into the bidding process, allowing publishers to understand the value of their inventory better and make informed decisions.
- Faster load times: Header bidding enables publishers to load bids from multiple demand sources in parallel, reducing latency and increasing the number of impressions served. The bidding happens during a fixed timeframe.
- Flexibility: It allows publishers to make real-time adjustments to bidding strategies, enabling them to optimize for specific inventory and respond quickly to changes in market conditions.
- Better targeting: Header bidding provides more advanced targeting capabilities as publishers can share relevant data with the demand sources in real-time. This, in turn, allows advertisers to reach specific audience segments and helps publishers increase revenue by providing more personalized ad experiences to the users.
How to Set up Header Bidding?
Owing to the technical complexity of the setup, it’s always advisable to look out for a header bidding provider. A good header bidding provider will handle the setup, bring in good demand sources, and offer complete transparency.
The benefits of header bidding are numerous, and for publishers looking to maximize their revenue, it is an essential tool in their arsenal. By partnering with a trusted header bidding provider, publishers can access the latest technology, expert support, and valuable insights to help them achieve their revenue goals.
With the right partner, the benefits of header bidding are endless, and publishers can rest assured that they are making the most of their ad inventory and reaching their target audience with the most effective and relevant advertising.