Everything You Need to Know About Header Bidding
If you’re interested in learning about the history of header bidding you’ve come to the right place…
When online advertising hit its stride in the 2000’s, DoubleClick “ad serving” service became the premier technology used by publishers to configure their website’s ad space. With overwhelming market share, this technology continued to grow and balloon into a massive organization. In 2007 it was purchased by Google. Doubleclick was making $300 million in revenue at that point, primarily from the publisher technology. Doubleclick for Publishers, or DFP, is a program used by major publishers across the world to set up the targeting schemes advertisers demand from their publisher partners.
With the advancements of real-time bidding (see ‘RTB & Programmatic Media’) DFP would allow the publisher to sell the ad on the ‘Ad Exchange’ via Doubleclick AdExchange (AdX). This is the ad exchange product produced by Google for publishers to use to sell their ads in real time with very strong results. Although AdX is not the only exchange in the market. There are several other competitors to the Doubleclick exchange which publishers can use.
AdX integrates seamlessly with the DFP. This is not surprising, because they are both produced by the same company and can build the technology into the same program. But, AdX is not the only ad exchange on the market. Many other technology players have built exchanges, such as AppNexus, Index Exchange, Rubicon, Pubmatic, Mopub, Smaato, OpenX. These systems do NOT integrate as seamlessly into DFP. In the below chart they are the ‘other networks’.
Because of Header Bidding, these other exchanges now seamlessly integrate with AdX, allowing the publisher to give these other exchanges equal opportunity to participate in auction for the ad space.
This is better for the publisher, as the fair competition across exchanges yields them higher CPMs. Because the auction happens in the header, there are some concerns on page load time for the user, but this can be mitigated with controlling the ‘latency’ of each partner participating in the header exchange.