According to a new report from ClickZ, authored by Rory Edwards, publishers are rushing headlong into header bidding, the popular new technique sweeping ad tech by storm. With the rapid increase in adoption on the sell-side, header bidding is a good thing for publishers, says the report. But what does the emergence of header bidding mean for brands?
“Traditionally, publishers have sold ad inventory using a technique known as waterfalling, says the report, a process that gives inventory access to different sets of buyers sequentially based on their priority in the eyes of the publisher.
As programmatic buying has matured and become an outlet for advertisers’ more premium advertising efforts, this hierarchical and sequential bidding process is leaving money on the table by placing guaranteed deals above the often lucrative CPMs available from programmatic buyers, says the report.
The priority can be determined by a variety of things, says the report, but often it is based on the revenue potential for the publisher, quantified by the amount of committed spend of an advertiser, or the historical average selling price for SSPs/Exchanges.
In the last year, however, header bidding has turned the historical waterfall model on its head. Publishers are now able to offer all of their inventory to all demand sources at once, opening the doors for RTB buyers to compete for the most premium inventory that was historically only accessible through guaranteed bulk purchases.
In effect, publishers are taking the demand from what used to be multiple sequential auctions, and collapsing this into one single, highly competitive auction that ensures publishers can extract the highest value for each impression. Most recently, Facebook joined the mad dash, experimenting with header bidding across numerous channels in its latest attempt to challenge Google.
Header bidding, the great equalizer for programmatic access, yields several reasons brand marketers are on the bidding bandwagon. Many premium publishers are “head over heels” for header bidding, says the report, as media owners aren’t the only ones benefiting. Programmatic’s latest poster child holds tremendous promise for brands, too, notes the report.
1) More inventory
2) Full audience
3) Enhanced premium buys
4) Brands, beware
5) The promise of header bidding
Concluding, says Edwards, “… what have historically been unsophisticated and inefficient guaranteed buys transacted directly with publishers can now be executed in a data-driven manner. This new format applies the data, decisioning and optimization of real-time bidding with the promise of minimizing wasted spend and enhancing the ROI of these campaigns.”
For additional information, please visit ClickZ here.