Just to make sure we’re on the same page. Unless you sell your ads directly to advertisers, when an ad loads on your website, it goes through an auction to sell that ad unit to the advertiser who makes the highest bid. There are different techniques for making this bidding process: Programmatic Waterfall and Header Bidding. Which do you think will bring the most ad revenue to your pockets and why? Don’t answer just yet! Let’s start by understanding what is what.
What is Waterfall in Programmatic Advertising?
Before Header Bidding was a thing, ads were served using the waterfall method. Programmatic Waterfall is a technique for selling a Publisher’s Ad Inventory through a sequential auction. It is done by ordering Ad Networks based on their performance and selling the ad unit to the first buyer of that list who meets the floor price.
For example, you set your floor price to 1€ and the first buyer on the ranking offers 0.50€. Since it’s not enough, the offer passes back to the next buyer on the list. The next one offers 1€ for the ad unit and it gets sold to them because it meets the floor price. If the third buyer on the list was willing to offer 2€, you would not be able to get to them because the ad space got sold to the first buyer who met your floor price. In other words, you missed out on the highest ad revenue you could’ve gotten for your ad unit. Total bummer, right?
What is Header Bidding?
Header bidding is also a programmatic advertising method for selling a Publisher’s ad inventory. It’s a real-time bidding process (RTB) where the advertisers bid simultaneously. This technology lets various ad exchanges/ad networks bid on an ad space at the same time right before it serves an ad on a website. The entire exercise is done in the blink of an eye. It improves the ad’s loading time and therefore SEO results.
Header Bidding conducts real-time bidding among various demand sources simultaneously where the publisher’s ad inventory is sold to the buyer who’s willing to pay the highest CPM. Also, with more advertisers participating at the same time for the audience, it provides a much better fill rate than waterfall auctions.
There are three main systems that provide header bidding:
Prebid
It’s an open source code header bidding wrapper. Prebid requires users to have some technical knowledge to implement it since it is self-managed. It can be personalized and modified to one’s wishes. It can work independently or in tandem with other header bidding systems.
Google Open Bidding (OB)
Google’s version of header bidding. OB is a unified server-side auction where multiple SSPs can bid simultaneously for an impression. It’s only available via Google Ad Manager 360 (GAM360) and it runs alongside Google’s Ad Exchange (AdX). OB is easy to set up and activate but doesn’t give you much control.
TAM (Transparent Ad Marketplace)
TAM is Amazon’s server-side header bidding solution for Publishers, similar to Google’s Open Bidding. It’s very easy to use, but requires a GAM ad server to connect with. TAM offers its own UAM (Unified Ad Marketplace) connections with a large number of SSPs so that you can hit the ground running in terms of monetization. But if you want to connect directly with your own demand partners you will need to have existing contractual relationships with these SSPs. Through Amazon’s platform, you’ll have access to their Ad Marketplace demand as well as the opportunity to connect with partners they work with such as Xandr AdaptMX, Magnite, GumGum, Smaato, and SpotX among many others.
At Refinery89 we happen to manage all three of these systems through our Single Tag solution! With Single Tag you have immediate access to Prebid, TAM, and Google Open Bidding, with over 25 premium demand sources competing for your ad space at the best CPMs.
Now, let’s compare Waterfall and Header Bidding!
Who wins this round? Waterfall or Header Bidding?
The winner by majority decision, introduced in 2014… Header Bidding!!!
Waterfall used to be the industry standard until Header Bidding came into the picture. However, it might not be the most convenient thing to use. You would not be able to maximize the revenue from your ad space, as you would with Header bidding.
Even though it is a bit more complicated to set up by yourself (plus you don´t really need to go through all the hassle, since that’s what we are also here for), Header Bidding allows Publishers to get a better yield thanks to RTB. The ad unit is sold to the highest bidder among a wide range of advertisers, in real time, increasing your ad revenue. Plus, you get higher quality ads thanks to the increased competition, thus improving your website’s ad monetization performance.
How to implement header bidding on your website?
Using Header Bidding to sell your ad inventory has never been so easy. Especially with our Single Tag ad monetization solution! It’s a single line of code that after placing on your site, gives you access to our Header Bidding technology, meaning Prebid, TAM, and Google Open Bidding with over 25 premium demand sources that command high CPMs.
Curious to try it out? Get in touch with us!
