What is Header Bidding? And how does it Drive Profit for Publishers?

Written by
May 13, 2024

What is header bidding?

Header bidding technology has revolutionised the way publishers sell their ad-inventory programmatically online; allowing for increased revenue by accepting advertiser demand from multiple sources, whilst also giving advertisers access to premium inventory from around the world. Considering the win-win proposition header bidding offers, it’s no surprise 60% of the internet’s 30,000 top website domains include tags from header bidding vendors. But what is header bidding exactly and how can it be best utilised to increase revenue for publishers? 

The drawbacks of the waterfall system

To fully understand the benefits of header bidding technology, we must first recognise how it differs from traditional ad-serving methods. Using the outdated ‘waterfall system’, impressions are first offered to the highest ranking ad-exchange in a site’s programmatic stack and if declined, subsequent ad-exchanges are invited to bid, until the CPM floor is met. However, as ad-exchanges bid sequentially after the one prior fails, this means the true value of the ad-unit is not fulfilled, as the first bid to match the publisher's requirements wins the ad-unit, rather than the advertiser offering the highest bid. 

How header bidding technology works

Browsers render HTML code for a website from top to bottom, starting from the header, up until the end of the site’s main body. Header bidding technology utilises a small piece of code, also known as a header bidding wrapper, stored within the header of a website, which allows ad-exchanges to bid for a given ad-unit, prior to the user loading the webpage. The header bidding wrapper determines how many demand sources can participate in an auction and ensures all bids are collected at the same time, rather than sequentially using the waterfall method. Header bidding technology can be used to optimize various ad-units, including banners, rich media and video placements. 

Publishers can opt for either an open-source or a proprietary header bidding wrapper depending on their needs and preferences. Whilst open source wrappers can be beneficial to publishers with less technical knowhow, proprietary wrappers can be customised according to a publisher’s desires and optimized to improve profitability. 

However, increasing demand sources can lead to increased page load-times, as users wait for data to pass through various ad-exchanges before rendering the page. Long load-times can impact a websites’ performance, bounce rates and even search engine rankings, so it’s important header bidding wrappers are well optimized to ensure publisher profitability remains high.

Benefits of header bidding technology

Header bidding offers a win-win solution for publishers and advertisers alike. Publishers can ensure their ad inventory is always sold to the highest possible bidder, whilst advertisers gain access to a larger selection of premium inventory, as more sites become available to access programmatically at any given time. This offers a few key benefits for publishers utilising the technology:

Increased revenue through greater ad-yield

As demand is spread across multiple ad-exchanges competing in a real time auction to fill given ad-units, publishers can benefit from increased revenue as the highest bidder will usually fill the ad-unit, rather than the first to meet the lowest price accepted by the publisher. 

Greater control over ad-impressions served 

The header bidding wrapper allows publishers to choose which ad-exchanges are allowed to bid for impressions on a given ad-unit, as well as filter specific campaign types, such as gambling or alcohol campaigns, from appearing across their inventory. 

Improved webpage load times

Bidding time is reduced as all bids are taken at once, rather than moving through various ad-exchanges in a programmatic stack. Header bidding wrappers can be optimized to further reduce load times depending on a website’s capacity.

Better ads for users

By increasing the amount of demand sources and therefore potential campaigns to be served, users are more likely to be served ads suited to their interests and preferences, whilst offering more engaged audiences for advertisers. 

Header bidding platforms

There are several header bidding platforms available for publishers at the moment, with the major players including Google’s Exchange and Open bidding services, Amazon’s Unified and Transparent Ad Marketplaces, alongside the open-source pre-bid server, which boasts a large and independent community of users. By taking advantage of the prebid platform, Venatus’ one-stop monetisation solution provides access to the world’s largest SSPs and demand sources, including Amazon, Google, Pubmatic & Xandr.

How Venatus’ header bidding solution surpasses the competition

Venatus’ proprietary header bidding wrapper utilises ‘lazy loading’ and other key optimizations to boost revenue for our publishers. Lazy loading means our header bidding wrapper does not send requests to ad-exchanges until potential ad-units are confirmed to be in view on a user’s display, meaning impressions for out-of-view ad-units are never generated. Lazy loading helps dramatically improve metrics such as load times, latency and viewability, which in turn means SSPs recognise our inventory as ‘premium’ and are therefore willing to bid at higher rates. 

Venatus also benefits from having preferential deals with our SSPs, who value our high quality ad-serving and premium inventory. This means our publishers achieve a better deal across all SSPs, compared to negotiating a private deal with each individual demand source. 

As header bidding technology can be utilised across multiple ad-formats, Venatus proprietary header bidding wrapper uses mediation to ensure higher yield ad formats, such as rich media placements, are prioritised ahead of lower yield formats in auctions. As direct deal campaigns offer greater profitability for publishers, these are always prioritised ahead of open market demand sources.

Get in touch

If you’d like to take advantage of header bidding technologies and begin accepting advertiser demand from the world's largest and most lucrative supply-side platforms, contact Venatus today and a member of our team will be in touch!

Contact: market@venatus.com