Articles on: Monetization

What is Header Bidding?

Read more on how to setup your first Header Bidding placement here

Header bidding allows publishers to sell ad inventory on their sites with the real-time auction and accept bids from advertisers and ad networks at the same time while requesting an ad server. At the end of the auction, the bidder chooses the buyer with the highest CPM bid. Only after that, the request is sent to the server, and the auction winner uploads his creative to the ad slot that participated in the auction.

To understand how the pre-auction works, we suggest recalling the traditional “waterfall” model.

Principle of the “waterfall” model

This is a series of auctions held by the publisher with buyers of advertising inventory. The priority of requests for the purchase of traffic is determined in advance by the publisher, while clients of direct transactions have a priority right to buy. If the impression is not bought out as a result of direct deals, then the right is transferred to the following participants (SSP, advertising networks).

The publisher's ad server sets the minimum price (floor) for an ad space that advertisers consistently start bidding from. If the first buyer offers a higher price than the minimum, then he is guaranteed to buy this slot. If the price is below the minimum price, the request is passed to the next buyer until the ad space is sold.

This hierarchical model for selling online ads has its drawbacks. A partner with a low priority for participation in the auction may actually not even make it to the auction, although he is potentially willing to pay a competitive amount for the impression. The palm belongs to the buyer who is the first to offer a price above the minimum. And this method, accordingly, excludes advertisers with the best offer. As a result of the passback calls that occur in each transaction, the page loading process slows down, which affects the behavior of users.

How does Header bidding work?

Header bidding works through a line of JavaScript embedded in the section of the publisher's website. The is an HTML element invisible to the reader.

A line of code connects the site to various sources interested in buying ad inventory. Each time a page is loaded, demand sources can bid on each impression on that page.

This procedure increases transparency by letting the DSP or SSP know which demand platforms are bidding, and also increases the cost of their offering by maximizing CPM.

Client-side header bidding process:

The user visits the publisher's website.
The header bidding JavaScript string on the website is activated and redirects the user's request to multiple SSPs and demand platforms (DSP and AdExchange).

The SSP auctions off their demand sources determine the winning bid, and returns them to the page;
Demand sources return their bids to the page.

The header bidding on the page in the browser runs a top-level auction between the received winning bids from DSP and AdExchanges and sends the winning bid to the ad server.
The ad server displays the ad of the winning bid on the page.

The user sees an ad with a winning bid. Everything happens within milliseconds.

Benefits of header bidding

What is the benefit of the application for publishers

Header bidding allows publishers to work directly with DSP companies or partners, bypassing SSP and other intermediaries, which creates a more transparent work mechanism.
The preliminary auction creates a fair competitive environment for all bidders. This way, publishers can determine the value of their inventory and increase ad sales revenue by up to 30% versus the traditional model.
The technology makes it possible to reduce passback calls and facilitate page loading, since the request to the ad server is made only once after the advertiser is determined.
Using the header bidding wrapper code, the publisher can run auctions with a large number of advertisers in parallel, without loading site pages and getting the highest offers from traffic buyers.

What are the benefits for advertisers?

Advertisers can get direct access to the publisher, eliminating sometimes a long chain of partners.
They have access to the entire advertising inventory at once, and not only unredeemed slots as a result of bidding with previous auction participants, as is the case with the “waterfall” model.
Buyers can claim premium inventory and, by offering the highest price for it, are guaranteed to buy it back.
The page loads immediately, which is important for the advertiser and the user who views the content.

Get maximum profit from your inventory, monetize display traffic with Ezmob Header Bidding

Related articles:
Publisher: Getting Started
How to add the tags to your website
Header bidding monetization with EZmob
Pop Up and Pop Under Variations

Updated on: 31/08/2022

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