2018 Header Bidding Trends: The Update You Need to Read

Last November, we explained how header bidding works and what advertisers should know. Since header bidding adoption is on the rise, and advertisers and publishers are taking it to new levels of complexity and sophistication, we wanted to cover the latest developments. Jay Friedman, our president, recently contributed to this 2018 header bidding guide, and here are five header bidding trends to watch in this quick update you need to read: 1)      Header Bidding Is Maturing on the Web. With U.S. advertisers expected to spend more than four of every five digital display ad dollars this year via programmatic channels per eMarketer, web publishers are adopting header bidding to squeeze more money from programmatic advertising. In fact, according to ServerBid’s assessment of the top 1,000 websites that offer programmatic advertising within Alexa Internet’s Top 5,000 U.S. sites, more than half used header bidding as of May 2018: 2018 header bidding eMarketer chart Since advertisers and publishers have a greater comfort level with header bidding, they’re each trying to refine this programmatic buying technique to make it more efficient, transparent and profitable for them. Advertisers, wanting to weed out low-quality sources, boost campaign performance and save money, are doing this by focusing on supply-path optimization (SPO), evaluating supply-side providers (SSPs) and exchanges to find the most direct paths to publishers’ inventory. Similarly, publishers are focusing on demand-side optimization (DPO), evaluating auction data and identifying the most active, beneficial programmatic partners and the best buyer and seller combinations to gain the most revenue. 2)      First-Price Auctions Are the Norm. “Header bidding is still being adapted and adopted. But it is a fixture in the industry.” Jay Friedman, our president, recently told eMarketer. “Most auctions are going to first price now, and it’s up to advertisers to bid algorithmically to ensure they’re paying the fairest price.” Why the change to a first-price auction model? Second-price auctions are difficult to execute for header bidding, especially when multiple demand sources are involved. First-price auctions make more sense: Publishers get the highest amount possible for their inventory, and advertisers get more price transparency to see what impressions are truly sold for. That way, they can change or optimize their buying strategies to compete. But discovering the right buying strategy so advertisers don’t overpay for impressions in a first-price auction is a challenge. With inventory so vast and auction dynamics changing constantly, it’s nearly impossible to hit upon optimal bids manually. Advertisers need help, and that help comes from machines. That’s why, even though it’s expensive, many demand-side platforms (DSPs) are now reconfiguring to support first-price auctions and putting buying technology and tools in place to help advertisers bid to win. 3)      Three Header Bidding Containers Are Standard. Header bidding has a range of benefits, like giving many advertisers at once a first look at an impression before the ad server and getting publishers top dollar for their programmatic inventory. But one major downside is it can cause increased page latency and page load times, which can then negatively impact the user experience. To combat this, publishers use containers, aka wrappers, which is simply technology to help them maximize, organize and manage their many header-bidding partners and all the code and complexity that come with them. These containers help publishers ensure all bids are made simultaneously and the ad server receives accurate, understandable info so the best bid wins every time. Our president, Jay Friedman told eMarketer: “The market seems to have settled on approximately three containers.” These three containers are client-side wrappers, server-to-server wrappers, and hybrid wrappers. A good number of publishers don’t just use one or the other; they use both. Let’s look at each type: ·        Client-side wrappers: This type of wrapper is placed in the browser. Code is embedded on a publisher’s site and connects all buyers who want to bid on ad space. Client-side wrappers are transparent, and buyers are willing to bid higher for these opportunities because they get access to audience data (think cookies and meta info) they can use to best target their audience and maximize their ad campaigns. Still, page latency and slow page load times can still be a big issue if many demand sources are included. ·        Server-to-server wrappers: This type of wrapper appears on an external server and includes all the info that once went in the browser. Working from an external server, there’s no drain on page latency, or page load, or negative effect on the user experience. But, one downside is they are less transparent than their client-side counterparts. Buyers typically bid lower for these opportunities since they don’t have access to audience data and can’t be sure a specific user is a good match for their campaign. ·        Hybrid wrappers: This type of wrapper is popular because it’s a blend of both client-side and server-side wrappers. To increase the number of buyers without increasing the risk of page issues, publishers may choose to keep some buyers in a client-side wrapper and others in a server-to-server wrapper, depending on the buyers’ advertising goals. Those seeking cookies and visitor info to correctly target their audience may stay client-side, while those wanting to spread awareness or increase brand recall may go server-side. This lets publishers meet the needs of a great number of demand sources without losing money. 4)      New Money-Making Practices Are in Play. Though questionable, here are a few header bidding practices you should be aware of and understand: ·        Bid caching: Publishers extend the life of bids. For instance, in this scenario, a buyer submits a bid but doesn’t win. The publisher then saves that bid for a small window of time, and if an impression comes up for sale in the header during that set time, the publisher submits the saved bid instead of rerunning an auction. This has ruffled the digital media industry because it’s not a transparent practice and sometimes is done without buyers’ knowledge. Won impressions from bid caching can hurt buyers’ ad campaign performance if they’re off-strategy or not brand safe. ·        Soft floors: This is an artificial bid that the publisher can insert in a first-price auction so advertisers submitting the highest bid must pay the artificial bid price, or, in a second-price auction, must pay more than the actual second-price bid. Soft floors can be frustrating because buyers can’t determine inventory ad value and implement a successful bid strategy. They don’t know if the bid that won came from the competition or artificially from the publisher. ·        Bid shading: Based on an ad tech provider’s calculation, buyers make a bid somewhere between the bids for a first- and second-price auction to not overpay for ad impressions. This practice is meant to get buyers more comfortable with the higher prices they now must pay due to the switch to a first-price auction model. ·        Net vs. gross bids: Sometimes, SSPs and exchanges submit a gross bid to a publisher to beat out other competitors who bid net. However, this is a deceiving practice. The gross bid may win, but the buyer ultimately won’t pay that price. They will pay the net price, which makes publishers lose out on expected revenue. To not be fooled, publishers are making more of a point to carefully check header-bidding contracts’ payment terms so buyers are locked in to only submitting net bids. 5)      In-App and Video Header Bidding Are Still in the Future. Digital display and mobile web advertising are well on their way to adopting header bidding, but in-app and video advertising are behind and in the early stages with header bidding so difficult to implement there. With in-app advertising, an app developer must add header bidder partners each time into an app’s software development kit (SDK), push out a new app version, and get users to accept and activate it, which is a multistep process that can be both time-consuming and challenging to accomplish. As for video advertising, header bidding is done a little with out-stream video and native video but not for in-player video (pre-, mid-, and post-roll) yet. But there’s not much of a need to do it for in-player video anyway with inventory so scarce and publishers not struggling to sell it. Header bidding, like other programmatic advertising trends, processes and practices, changes quickly. Think of all the latest developments that have occurred this past year. If you’re finding it hard to keep up, stay informed and chart the right course, we’re here to help – to expertly guide, advise and assist you with your programmatic campaigns.

Five Ad Tech Gifs That Will Have You Nodding (and Laughing)

Since ad tech practitioners bring together the perfect combination of a “get it done” attitude and a “let the creativity flow” mindset, we naturally fell in love with the Gif trend. (That’s pronounced Gif, not Jif …. Fight us!) But as much as we enjoy cute cats and Ryan Gosling, we’ve had a hard time finding clever ad tech Gifs to add to our presentations, social media, and afternoon email threads when the boss isn’t looking. So being the trailblazers we are, we decided to make a few of our own.

Targetingdog trying to catch a Frisbee

What makes your audience tick? Without mining crucial intel from the data you own, your targeting could miss the mark.

Measurement

Google Analytics can give you a good picture of how you’re doing but can’t give you the whole story. We can give you the customized and precise data insights you need to succeed.

Reporting

If only you could bottle the bliss you feel after pressing “Send” on your client report, knowing you only have good news to share.

Media Costs

Connected TV at that price? Is that too good to be true? Yup, pure fantasy, it only lives in your imagination.

Attribution

What it feels like when you find out you’re a winner … and then realize you’re not the only one.

3 Digital Marketing Trends That Top Our 2019 Predictions

In 2018, digital marketing trends dominated headlines inside and outside of the industry as Facebook faced the Cambridge Analytica scandal, GDPR went live, and AT&T, SiriusXM and Adobe all made major acquisitions. But as the year comes to a close, I’m already looking forward to seeing what new innovations and changes you can expect in 2019. From this vantage point, there seems to be plenty to watch on the horizon. Some digital marketing trends expected to rise up are just more mature versions of their counterparts already in play and others are born of new game-changing technologies currently in development. So, take a break from your daily task list and take a look at the 2019 predictions you’ll want to know about before you build next year’s strategy: 1. This will be the year that advertisers get serious about audio. The renaissance of digital audio – streaming radio, podcasts, voice assistants – has created one of the most anticipated opportunities of the coming year. And we’re not the only ones seeing that audio is primed for takeoff. From Pandora’s acquisition of AdsWizz to SiriusXM’s play to buy Pandora, recent signals have many in the industry believing that programmatic audio is finally reaching marketplace maturity. It’s no secret that mobile is driving digital media usage, with U.S. users devoting nearly 3.6 hours to a mobile device each day, according to eMarketer. But how are consumers spending that time on their devices? Listening. Audio takes up the biggest chunk of mobile usage at 52 minutes. But today, audio isn’t 100% synonymous with streaming music. People are sharing celebrity-curated playlists, downloading branded podcasts, and getting daily news briefs from their digital assistants. What this means is a variety of formats and niche audiences for advertisers to tap in 2019. Compared to other ad formats, audio has been slow to catch on in the past, but rising adoption rates among voice-activated speakers and audio subscription services have marketers eager to apply it to next year’s strategy. Sarah Scherer, media product manager at Goodway Group, sums it up simply, “More money will flow into programmatic audio in the coming years as advertisers recognize the cost efficiencies and optimization benefits compared to linear radio.” With near limitless opportunities to target your audience and expand reach, there has never been a better time to take advantage of the power of audio. 2. Advertisers will simplify their media buying and reduce their risk of fraud by re-evaluating the number of SSPs they work with. One thing came through loud and clear in 2018. Advertisers want to know exactly where their ads are running. This call for transparency isn’t just about the cost or impression numbers; it’s also closely linked to brand safety and the desire to avoid fraud. Marketers focused on simplifying their media buying in 2018 started by reducing the number of DSPs they work with from 7.1 in 2016 to 3.9 this year, according to eMarketer. So, it’s not a big surprise that our 2019 predictions include the natural next step – limiting their SSP relationships too. Our mission has always been to demystify digital marketing trends for our partners. So, let’s get clear right now on why the number of SSPs you work with matters. There are so many SSPs out there – too many actually. A lot of it is the same redundant technology, so you aren’t getting any extra value out of using 10 SSPs versus three. Instead, every SSP you add into your media mix adds on another layer of unnecessary complexity and increases your risk of encountering fraud or domain spoofing. While expecting all those SSPs to agree and close up shop isn’t realistic, our president Jay Friedman suggests that marketers significantly reduce the number of SSPs with which they spend. He believes this will accelerate SSP consolidation faster than any other force. If you consolidated your buying to a handful of SSPs, you could potentially leverage the aggregated buying volume to negotiate lower SSP take rates and trim ad tech fees from bid duplication. If nothing else, working with fewer SSPs means a lower risk for shenanigans, like bid caching. At Goodway, we know more isn’t always better. That’s why we’ve already scoured the SSP landscape and the open exchange to build a custom-curated programmatic exchange using only the SSPs that offer the cleanest, safest, highly viewable sites, apps and other digital inventory. I could geek out on our exclusive HSD marketplace all afternoon, but I’ll save those thoughts for another blog … 3. Many states will pass new data protection laws and regulations similar to GDPR. Online marketing has been around for more than 25 years, and programmatic for more than 10. It’s simply time for everyone – advertisers, ad tech providers, and consumers – to unite behind higher standards. GDPR was the first step in that direction for the EU, and I expect U.S. regulations will quickly follow. Already several states have introduced legislation to expand data privacy for their residents, giving them more control over how their personal data is collected and used. California’s Consumer Privacy Act goes a step further, requiring companies to make significant changes to their data handling and processing procedures. In Vermont, new legislation also requires data brokers to register with the state, better inform consumers about their options, and notify authorities of any security breaches. While U.S. regulations will mirror many of GDPR’s protections, it is doubtful that states will deem data privacy a civil right, as it is in the EU. Instead, most states are looking to give consumers the right to demand that companies disclose what information they collect, to block that data from being sold, and to sue noncompliant companies. However, even if lawmakers in every state set the stage for these regulations, the laws and enforcement likely won’t go into effect for several years. For instance, Vermont’s changes for data brokers don’t kick off until 2019, and California’s Consumer Privacy Act doesn’t take effect until 2020. In the meantime, if you’re looking for the most effective ways to reach your target audience in a post-GDPR world, you may want to start by auditing your data management program. Review your data protection policies with your legal and compliance teams. Then, develop a real-time process for handling customer requests and opt outs. As we enter another new year in just a few short weeks, I’d like to impart one more piece of advice: Remember that these changes aren’t silver bullets. Innovation can be exciting, but there are a number of hurdles to overcome first if we’re to truly see a digital transformation in the coming months. To keep up to date on what else is happening in ad tech in 2019, stay tuned to our blog.