Header Bidding Outcomes 2019

Dec 26, 2019

Header bidding became a go-to ad selling tool among publishers, and it’s easy to say why. The programmatic model of ad inventory selling gives more control over the process, maximizing publisher revenue by up to 30%. Header bidding technology allows offering the ad spaces simultaneously to multiple DSPs and ad exchanges before making requests to the ad server. It helps to decrease the time of page load and creates a transparent partnership between media companies and advertisers.

How Header Bidding Auction Works

The popularity of this technology has been growing over the past years. Header bidding adoption among Alexa Top 1000 US sites has risen from 72% to 79.8% from October 2017 till March 2019. A bit more than half of 10k US and UK publishers are doing header bidding on their sites now, as per Adzerk Q4 2019 report.

Header Bidding Trends 2019: The Updates You Need To Know

Header bidding solutions are expanding according to the growing market demand. Therefore, technology is becoming more sophisticated over time. Ad tech companies determine new ways of growth providing programmatic parties with more advanced tools and mechanisms. So In this article, we look through the most demanded header bidding trends over the past year as well as predictions and forecasting why they will be ongoing further.

1. Video header bidding

 

Video header bidding has two major advantages for publishers. First, it decreases the latency of video content loading as an auction initiates before the video starts playing. Second, video header bidding brings maximum yield to publishers. The technology allows advertisers to bid simultaneously as opposed to the waterfall model in which DSPs call the bid one by one until one of them offers the price which is higher than the floor rate. Parallel auction in contrast to waterfall brings the highest bid proposed among all participants at once.

It’s predicted that $81 billion of all US digital display ad dollars will transact programmatically by 2021. And the video formats take half the amount. As for devices, the mobile video ad spending has already overtaken desktop video ad spending in the United States and is projected to surpass 8.6 billion U.S. dollars in 2023. Generally, growth in digital video programmatic spending is expected to rise +4% year by year, now reaching 53% overall, according to IAB final report 2019. Apparently, video ad formats will be in great demand in the next year. So applying header bidding for video inventory can bring to publishers more programmatic yield.

2. Header bidding wrappers

 

Header bidding wrapper is a technology that was initially developed as a solution on how to organize a large number of buyers. So now the publishers who work with many advertisers and with different header bidding solutions prefer to use wrappers. The core principle of the header bidding container, as it is also called, is to make sure that all bids are triggered in parallel. It forms the rules for a programmatic auction to bring the highest bid. And in such a way, publishers have more control over their programmatic yield.

How Header Bidding Wrapper Works

There are proprietary wrappers developed by particular SSPs and open-source wrappers such as the Prebid framework, for instance. There are many other wrappers that widely adopted by publishers. Though, most of them are based on the Prebid framework which is flexible and can be customized for the publishers’ requirements. Buildwith counts 118,918 websites that have been using Prebid globally for various periods since 2016. Currently, 36% of the top 1 million sites by traffic are using Prebid wrapper. For instance, IAB Tech Lab header bidding wrapper ranks higher only. It is used by 37% of 1 million sites by traffic.

3. Server-side header bidding

 

Originally header bidding is carried out on the client-side (browser-side). There is a JavaScript code added to the header of a site that makes technology works. It connects all sources of buyers that bid for ad inventory. The downsides are that the browser allows connecting to a limited amount of sources. Moreover, a big quantity of advertisers connected to a header bidding wrapper leads to a lower side speed because of running a lot of JavaScript processes on the page.

Speed and page load time continue to be highly important for publishers. And server-side header bidding much more efficient at this point. The whole process of header bidding auctions is conducted on an external server of the ad tech company. The publisher still needs to add a snippet of code on the site, but requests are sending from the ad tech server to all relevant DSPs, not from the browser. Server-side header bidding is easy to integrate. It allows more demand partners to add to the auction, and it shrinks page load time.

4. Mobile in-app header bidding

 

Considering the increasing number of mobile apps and in-app mobile ad spending, programmatic buying methods have become a hot topic for the industry. And in-app bidding is getting one of the trendiest technology for the app publishers, though it is at an early stage of development. The MoPub’s recent advanced bidding tests showed real advantages of in-app bidding such as an increase of 5% to 15% in publishers’ ARPDAU, an increase in filled supply, an increase in supply access for all programmatic buyers, and an enlarged wallet share for all programmatic partners.

Despite some big tech providers have started to launch in-app solutions, it is still a challenge for most app publishers. The main complication for adopting in-app header bidding has remained a lack of good bits of knowledge on how it works and on the implementation issues, both from publishers’ and advertisers’ sides. So still more lightweight solutions are necessary for the market. Publishers used to appeal to SDK mediation solutions based on the waterfalling method but the quantity of partners is limited and more manual work might be required. The in-app bidding, in contrast to, helps to reduce the necessity of SDK implementation since the solution provides access to a big number of demand partners. Technology is seen as beneficial for publishers, buyers, and mediation platforms alike. But time is needed to make it work for the majority.

5. In-housing and customization

 

As per the IAB Europe report, 65% of publishers are having an in-house programmatic. The rate increased from 34% since 2016. It could be explained by the fact that the demand keeps growing, and publishers want as efficiently as possible to optimize their programmatic ad selling and to take control of the process. Programmatic in-house brings many benefits such as ad performance improvement, transparency and programmatic yield boosting. By implementing own in-house header bidding infrastructure, publishers can make more informed decisions through every step of the process to gain maximum revenue.

Although it can be a challenge because of a lack of practical knowledge on how to operate it, still building an internal header beading framework means better monetization for publisher inventory and more control of operations. “A third of publishers (35%) are developing in-house operations to gain greater transparency and control of their programmatic processes”, as per IAB Europe presentation. For a start, combining in-house operations and external support of ad tech partners, publishers can do the best for themselves.

The most significant header bidding facts of 2019

  • 73% of US ad operations specialists referred to header bidding technology as a top trend for improving ad quality.
  • Mobile took up 51% of the header bidding volume share. Header bidding is speeding further mobile ad monetization worldwide, accounting for more than half of header bidding transactions in Q3 2019, a rise from 41% last quarter.
  • Transparency and revenue growth are the main factors that remained crucial for publishers. And header bidding, at this point, is doing great work for media companies. As one example, The Telegraph grew its programmatic revenue by 70% using header bidding.
  • Header bidding will continue to be the trendiest way of programmatic ad selling in a new year. Various header bidding solutions has been appearing as a reaction to the market needs.
  • For publishers, header bidding technology facilitates to optimize yield, cut down on passbacks, and increase the transparency of inventory value.

Header Bidding changed the programmatic advertising industry bringing more transparency and forecasting for better business strategy both for publishers and their partners. This technology becomes more affordable as many supply-side platforms provide free access and connection. This method of ad buying infused many benefits into the media supply chain, and it is going to last and develop in 2020. In the next article, we will describe in detail the most expected header bidding trends for the next year. So follow our blog news to be aware of the new directions for publishers in the programmatic.

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