Header bidding is a programmatic advertising technique that allows website publishers to offer ad inventory to multiple demand-side platforms (DSP) simultaneously in a real-time bidding (RTB) auction. This process helps publishers maximize their ad revenue by allowing multiple ad buyers to bid for the same ad space in a fair and transparent manner.
Programmatic advertising refers to the use of automated systems and software to buy and sell digital advertising spaces. It involves using data-driven algorithms and real-time bidding to serve relevant ads to consumers at the right time and place.
When a user visits a webpage, the header bidding script sends a request to multiple demand-side platforms simultaneously, allowing them to bid on the available ad space in real-time. The highest bidder wins the auction, and their ad is displayed on the page.
Header bidding increases competition among ad buyers, resulting in higher bids for your inventory. By enabling multiple DSPs to bid on your ad inventory, you increase your chances of selling more ads at better prices. Header bidding also improves transparency and reduces latency by bypassing traditional waterfall auctions.
Demand-side platforms (DSPs) are platforms that enable advertisers to purchase ad inventory programmatically. They use algorithms and data-driven insights to target specific audiences based on factors such as location, interests, behavior, demographics, etc.
Supply-side platforms (SSPs) are platforms that help publishers sell their ad inventory programmatically. They connect publishers with DSPs who are interested in buying their ad space.
Waterfall auctions are an older method of selling ad inventory where publishers prioritize which buyer can see their inventory based on past performance or other factors. However, this method often leads to lower prices and reduced transparency. In contrast, header bidding allows multiple buyers to bid simultaneously, resulting in fairer prices and more transparency.
Some common mistakes in header bidding include not testing different demand partners, not optimizing ad placement, not implementing viewability measurement tools, and not monitoring latency.
References:
Casale Media. (2016). Header Bidding 101: A Guide for Publishers. Retrieved from https://casalemedia.com/white-papers/header-bidding-101-guide-publishers/
Greenberg, B. (2018). Programmatic Advertising: What It Is and How It Works. Retrieved from https://www.wordstream.com/blog/ws/2018/02/28/programmatic-advertising
Spencer, S. (2017). The Publisher's Guide to Header Bidding. Retrieved from https://www.adopsinsider.com/ad-exchanges/header-bidding-guide/
Waisberg, D., & Kaushik, A. (2015). Google Analytics Breakthrough: From Zero to Business Impact. John Wiley & Sons.
Advertising Digital ID. (2021). The Beginner's Guide to Programmatic Advertising for Marketers. Kindle Edition.
