What is Header Bidding? How Publisher Maximizing Revenue?

By Rahul Last updated Nov 16, 2023

Header Bidding A revolutionary tactic in the field of digital advertising is header bidding. By enabling various demand partners to compete in real-time for ad impressions, it gives publishers the opportunity to maximize their revenue. This in-depth guide will cover header bidding’s definition, background, workings, benefits, and drawbacks, as well as the relevant tools and tactics.

What is Header Bidding?

Header bidding is a programmatic auction technique in which bid requests are delivered in real-time to a number of demand partners at once, including SSPs (Supply-Side Platforms) and ad exchanges. Depending on the level of demand, each ad impression has the potential to be sold for its utmost price. The process comprises choosing the highest bid, which defines the ad creative presented to the user, after running bids through different filters provided by publishers, such as floor prices and targeting parameters.

Comparison with Waterfall Setup

The programmatic ecosystem sold goods using a waterfall configuration prior to header bidding. This strategy entailed prioritizing impressions based on past performance as they were passed via a series of networks and exchanges. But it turned out to be ineffective, time-consuming, and constrained in terms of maximizing revenue. These problems were addressed through header bidding.

Effects on Publisher Revenue

Publisher revenue has increased significantly as a result of header bidding, with several publishers seeing rises of 20% to 50% or more. With billions of dollars being spent on header bidding, it has emerged as an essential technique for publishers everywhere to generate cash.

Header Bidding Wrapper and Adapter

Header bidding wrappers were created to make header bidding implementation less complicated. These wrappers serve as containers for the demand partner code snippets, simplifying the management and configuration of the auction. Prebid.js, Pubfood.js, and BiddR°360 are a few well-known wrappers.

How Header Bidding Works: Client-side vs. Server-side

A webpage’s header bidding auctions begin as it loads and sends bid requests to demand partners. The advertisement is displayed and the winning bidder is charged that amount. Client-side and server-side header bids fall under two categories. Better targeting is provided by client-side auctions, which take place in the user’s browser but may result in increased page latency. Server-side auctions are conducted on devoted servers, cutting down on latency but sacrificing targeting precision.

Advantages of Header Bidding

Publishers can gain a lot from header bidding, including:

1. Maximised demand: The presence of several demand partners boosts competition, which drives up bid prices.

2. Transparent exchange: Header bidding makes the exchange transparent by providing bid-level data, allowing publishers to efficiently track performance.

3. Greater control: Publishers can manage demand partners, customize auctions, and set floor pricing.

4. Minimum discrepancy: Header bidding minimizes disparities, enabling more precise transaction tracking.

5. Advantages for advertising: Transparency and competition in header bidding favor advertisers by promoting higher-quality inventory.

Disadvantages of Header Bidding

Header bidding has some disadvantages despite its benefits, including:

1. Difficult setup: Header bidding implementation might be difficult and require technical knowledge.

2. Higher cost: Managing header bids may need specialized staff, raising operating costs.

3. Added latency: Client-side header bidding may cause a delay in the loading of pages.

4. A lack of server-side transparency may result from server-side auctions that restrict access to bid-level information.

Prebid: Open Source HB Wrapper

AppNexus developed Prebid, an open-source header bidding wrapper. By enabling publishers to include JavaScript snippets on their websites, it streamlines the setup. Prebid is a favorite among publishers and demand partners since it enables many kinds of header bidding, such as client-side, server-side, and hybrid solutions.

Header Bidding and AMP

To efficiently monetize AMP traffic, header bidding was modified to work with Accelerated Mobile Pages (AMP). Real-time configuration (RTC) and wrapper-based integration were introduced as two methods. While wrapper-based solutions enable server-to-server communication for greater flexibility and better reporting, RTC allows publishers to add up to five demand partners.

Video Header Bidding and Its Working

Publishers can offer their video ad inventory to the highest bidder thanks to video header bidding. Although there were initially worries about the competition for video inventory, recent trends show that there is an increasing demand for video advertising. Numerous demand partners are actively interacting with publishers in the video ad market, including OpenX, AppNexus, and SpotX.

Google’s Response to Header Bidding: Open Bidding

In reaction to header bidding’s success, Google unveiled Open Bidding (formerly Exchange Bidding Dynamic Allocation), its server-side header bidding solution. Server-to-server auctions are offered by Open Bidding, easing setup and management. To reach a wider spectrum of demand, publishers can run header bidding and Open Bidding simultaneously on Google Ad Manager.

Amazon’s Header Bidding Solution: UAM and TAM

Unified Ad Marketplace (UAM) and Transparent Ad Marketplace (TAM) are two server-side header bidding options that are provided by Amazon Publisher Services. Small- to medium-sized publishers are the focus of UAM, which enables them to bring their needs. TAM offers access to more than 20 demand partners from the Amazon Marketplace and caters to major publishers.

Ready to Try Header Bidding? Here are 5 Steps to Prepare

Here are five measures to get ready for publishers who are new to header bidding:

1. Determine whether header bidding is appropriate for your business and think about forming a specialized ad operations team.

2. Acquire knowledge of header bidding and comprehend its operation.

3. Get ready for difficulties like higher page latency and the requirement for customized reports.

4. To maximize revenue, carefully select demand partners.

5. Run A/B tests and keep improving your header bidding configuration.

How to Set up Header Bidding?

In order to set up header bidding, follow these steps:

1. Based on your audience and niche, choose the best demand partners.

2. To manage demand partners and set up auctions on your website, install a header bidding wrapper.

3. To balance revenue and page delay, set timeouts, floor prices, and other auction settings.

4. Constantly review and improve your header bidding setup.

Header Bidding Extensions

Publishers can examine the demand relationships of their rivals and improve their setups with the aid of a number of header bidding extensions. These add-ons include MyAdPrice, Headerbid Expert, and BidFilter.

Conclusion

In conclusion, header bidding has transformed the world of digital advertising by enabling publishers to earn the most money possible. Although it has drawbacks, its advantages, flexibility, and openness make it a useful tool for publishers looking to succeed in the cutthroat ad tech market.

Frequently Asked Questions

Q1. What is Header Bidding?

Header bidding is a programmatic auction technique that enables each ad impression to be sold for the greatest price feasible based on the level of demand by simultaneously sending bid requests to numerous demand partners in real time.

Q2. How does Header Bidding work?

Header bidding entails submitting bid requests to several demand partners, filtering bids using publishers’ criteria, and choosing the highest bid to show the user’s ad creative.

Q3. How does Video Header Bidding work?

Publishers can offer their video ad inventory to the highest bidder thanks to video header bidding. Real-time competition among demand partners is used to get video ad impressions.