Being in the advertising ecosystem, you must have come across one of the hottest topics ‘Real-Time Bidding‘ which is an auction in an ad exchange that involves buying and selling of ad inventories in real-time.
As with everything in adtech, it has its drawbacks. This, in turn, leads us to a pre-auction technique called ‘Header Bidding’. Though header bidding is complex, it allows publishers to have more control and management over the ad space for ad inventories.
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So, What is Header Bidding?
To be precise, header bidding is the process that allows publishers to carry out direct auctions for every new impression and increasing their revenue by gathering bids from multiple sources such as ad networks, ad exchanges, and DSPs; all before sending the ad request to the server.
There are basically two categories of header bidding:
1. The client-side header bidding – In this method, bids start to come in from various demands because of the implementation of javascript on publishers’ websites.
2. The server-side header bidding – In this method, the ad request is sent from an ad server to multiple demand sources, and pre-auction is taken off of the publishers’ header.
Learn more about the types here.
The reason the publisher utilizes header bidding (or direct auctions) is to avoid the intermediaries that cause inefficiencies in gaining the best rate for ad space, allowing greater control over the demand and supply process.
Bypassing intermediates assist publishers in reducing their dependency on the partnership with third-party vendors and results in achieving higher revenues. So far, programmatic revenue for publishers has increased by up to 60% because of header bidding. However, we can’t guarantee the steep increase as it depends on the publishers.
The aim of publishers is to gain higher fill rates and maximized CPMs, and header bidding facilitates the required. In order to achieve the same, publishers need to look out for partners who understand the variety, volume, and importance of available demands.
There are many available demand sources, however, the first and third party partners are considered as main. Thus in order to ensure the best higher filling rates and eCPMs, one needs to carefully evaluate the partnerships. Also, careful evaluation of native or third-party demand partnerships can help publishers in achieving higher fill rates and eCPM.
Another concern with header bidding that comes to a publisher is to provide the optimal user experience. For this, publishers need to find out partners that have a strong infrastructure that takes care of latency issue and deliver reliability, speed, and experience required to keep the user happy.
How to achieve higher CPM with header bidding
Header bidding is considered an important tool that delivers higher CPM for publishers. If you are a publisher looking to improve your CPM rate, there are certain things to remember:
1. Partner with header bidding partners with the right infrastructure and reliability. Partners that can work with the perfect balance of providing user experience by avoiding latency. Such bidder partners drive efficiency and bring in an increased CPM rate.
2. It is important for the publisher to have an eye on the way bidder partners bid on your ad inventory. By A/B testing, a publisher can monitor and check their data performance; if found underperformed or less response to bids, publishers should drop out the partnership with that bidder partner. The partners who receive higher bids on your inventories are worth the effort.
3. In header bidding, site latency should be evaluated all the time. The poor site loading and responsiveness lead to poor user interaction and hence low bid impression. Thus, in order to achieve higher CPM, you must check for the right ad formats that are easy to load on the page.
4. Another important point the publisher needs to take care of is to track and collect bidder data. This helps in knowing how the bidders respond to a particular ad inventory and if there are any discrepancies, publishers can optimize bid data to achieve maximum revenue from web traffic.
More tips on increase CPMs can be found here.
Benefits of header bidding for publishers
One of the most common questions that come from publishers is how do they achieve higher eCPM and higher revenues? Well, to answer this, header bidding allows every buyer an equal opportunity to bid on the same ad inventories at the same time endowing with maximum competition between the bidders and drawing more revenue for publishers.
1. Header bidding facilitates competitive and dynamic ad stack.
2. Header bidding permits a number of buyers and thus improves the chances of filling the available inventories; leading to higher fill rates for publishers.
3. Publishers receive the bids from genuine buyers allowing a higher CPM.
4. Header bidding provides a clear picture of the inventory value.
