When publishers seek advice for increasing CPMs, the suggestions they receive are mostly generic – Increase ad viewability, improve user experience, and implement header bidding, among others. While there’s no doubt that these best practices can increase CPM, we have seen publishers struggling with low CPMs even after they implemented the suggestions. There are hundreds of things that can go wrong when it comes to serving ads.
So if you are trying to figure out what went wrong with the setup, know there’s still room for improvement. In this post, we will cover some more reasons that could be dragging your CPMs down and discuss the solutions as well.
Sidenote: Consider this as the next round of troubleshooting, and you should’ve taken care of the suggestions mentioned here.
Table of Contents
Header Bidding Implementation
a. Premature optimization:
Header bidding is known to increase CPM for publishers. But if you recently implemented it on your site, don’t expect CPMs to shoot up instantly. When your inventory is new to the market, bidder partners will take time to bid for it because of the absence of historical data. It will take at least a week to start seeing the bids and eCPM lift. If you try to optimize prior, you may get undesired results.
b. Static sequence of bidders:
The header bidding wrapper sends bid requests to multiple bidding partners. The collected bids are then sent to the ad server. If the wrapper is sending the bid request in a sequence, and that sequence is the same every time, then the last bidder to get the request will have the least amount of time to submit its bid response to the ad server.
As a result, the playing field will not be the same for all the players, and you will not benefit from fair competition.
c. Floor prices:
Price floors are perhaps the most straightforward way to increase your CPMs. Let’s say you are selling your ad impressions at $1 via AdSense; when you implement header bidding, try to increase the floor price slowly as well. But ensure you are capturing most of the bids (if not all) from header auctions. Having a high price floor can balance out the benefit of header bidding.
d. Demand partners:
While using header bidding, the idea of having many demand partners entices us. We know that more competition leads to higher prices. But if the bidders aren’t actively bidding and winning your impression, then there’s no use.
Some partners may not be winning auctions at all, and some may not even bid for most of the impressions. As a result, you will end up with technical issues like higher page loading times, low CPM, difficulty in reporting, etc.
Solutions:
- Soon after implementation, check how your header bidding is working to rectify any setup and integration issues. Once it is solved, start optimizing it to increase CPM.
- To level the playfield and run a fair auction, randomize the bidder sequence in your wrapper.
- Experiment with different floors, analyze results and then optimize. There’s no one-size-fits-all solution in ad tech. It is better to use dynamic flooring that uses automation to find high prices for every impression.
- It is ideal to assess the partner periodically. You can look at metrics like bid rate, win rate, etc., to assess and remove the underperforming ones. It is also advised to connect with a limited number of demand partners for performance optimization, efficient auction, and maintaining the quality of ads.
Can Privacy Laws Impact Your eCPM?
In the past few years, the concern for online privacy has increased worldwide. Enforcement of laws, including GDPR, CCPA, and COPPA, is proof of it. And, as they target the data (which is used to value an ad impression), CPMs tend to be affected.
a. GDPR
For instance, GDPR requires you to get legitimate consent from EU users for ad targeting and supply the consent status (yes/no) to the ad tech vendors via a privacy string. If you are not providing the privacy string, then advertisers, to avoid the risk, may not bid for your impressions. As a result, the price of your inventory goes down.
b. COPPA
Similarly, COPPA says that you cannot serve personalized ads to children. So, if your target audience is children, then your CPM is bound to go down. In fact, recently, Google Ad Manager blocked price priority line items targeting child-directed ad requests (your header bidding partners wouldn’t be able to serve any ads at all – personalized or non-personalized).
Solution:
- Ensure you are keeping up with the platform changes and laws.
- Implement a proper consent mechanism (via a Consent Management Platform) and update the platforms (Google Ad Manager, for example) as instructed to mitigate the impact on CPM.
- It is better to ensure users with consent message that their data has been ethically used for personalization.
- As per the recent Google requirement, use Google-certified CMP that follows IAB TCF v2.2. This initiative tries to give users extra information about how their data is used, such as purpose, the list of third parties with whom the data has been shared, etc. It increases transparency and user trust.
How Does a User’s Browser Affect the eCPM?
If most of your audience uses Safari and Mozilla browsers, it would be difficult for the ad buyers to target the right audience. These browsers are fighting against the use of third-party cookies — the backbone of personalized ads so far. By the end of 2024, Google’s Chrome browser will also follow the suite. Since personalized and retargeted ads are the first choice of advertisers, the inability to target will bring down your CPM.
Solutions
- You need to develop your first-party data strategy to keep your CPM intact after cookie depreciation.
- Additionally, using key-value targeting for direct campaigns will improve the results and help you get high rates for your inventory.
- You can utilize other post-cookie approaches like User ID solutions and Privacy Sandbox for behavioral targeting to increase your CPMs
- Contextual targeting is also one of the best ways to increase your CPM in the post-cookie era, regardless of browsers and devices.
Ad Refreshing and User Activity
a. Ad refresh
Ad refreshing will increase CPM and revenue when done right. There you go – we said it, and we’ve seen impressive results across hundreds of publishers first-hand. But when ads are refreshed too often, the user will not get enough time to see the ads before they are replaced.
It means your viewability will be low, so your CPM will also be lower. But CPM should not be the only metric you should be tracking with Ad refresh because the number of impressions will also increase.
b. User engagement
Signals like high bounce rate, low dwell time, low organic traffic, low page loading speed, invalid traffic, etc., show that the quality of your inventory isn’t good. Many of these signals also lead to lower CTR, engagement, and user attention.
When you are not able to convey that your website and its audience are valuable, then advertisers will not prefer your inventory. So, the CPM will not be higher. Work on your content and optimize it with the help of first-party data.
Solution
- Ad refresh can increase your CPMs when it is done right. Use smart ad refresh technologies to find the optimal time to refresh ads based on different user interactions with the page. You can achieve an 80% uplift when using smart ad refresh technology.
- While the second auction for ad refresh may bring lower CPMs, it will increase overall impressions, viewability, and ad revenue. It is better than showing one ad the whole time when the user is actively engaging with your content.
- Improve user engagement with quality and intriguing content. Reduce ad clutters, show relevant ads, optimize ad placement, try interactive ads, decrease load times, and improve responsiveness to improve user experience.
What’s Next?
The programmatic advertising space opens up tremendous opportunities for publishers to get the most out of their ad inventory. This post provides a few tips on maximizing your programmatic display ad revenue.
To wrap up, what will the future bring for publishers regarding a sustainable CPM? Will it be ads or subscriptions? Yes, these questions have been asked and answered before. But with Programmatic’s focus on data-driven selling, knowing their audience and creating engaging content will be a priority whatever route publishers choose.
