By Neil Patel

Despite the technology involved in the adtech space, there are still many inefficiencies and unfair practices that need to be ironed out. Header bidding is a solution that brings publishers and advertisers together.

What Is Header Bidding?

Header bidding is a process where many advertisers simultaneously bid (in real-time) in a digital auction to win ad space on your website. This auction occurs outside your primary ad server every time your pages load or whenever an ad unit refreshes.

For publishers, the primary advantage is it helps ensure you get the best deals on your ad space. To do this, you must ensure that you reach out to supply-side platforms (SSPs) and other demand partners to ensure you have many advertisers to bid on your inventory.

Header bidding is a more refined way of auctioning off your ad inventory. While it may be a bit more complex to implement than traditional methods (like waterfall bidding), it has many advantages that make it worth the hassle.

How Header Bidding Works

Here’s how the whole process play out when a visitor lands on a publisher’s page:

• A visitor clicks a link that takes them to a web page
• As the page loads, the short string of JavaScript in the page’s header makes a call to your demand partners or ad networks
• Each demand partner places a bid on the publisher’s ad inventory
• The winning bid is directed to the publisher’s ad server
• The publisher’s ad server then connects the user to the advertiser’s server and displays the winning ad

The process may involve several steps, but it takes less than a second from start to finish.

Header Bidding Vs. Waterfall Bidding

One of the most popular methods of buying and selling ad space was waterfall bidding. It has worked pretty well for the past few years, and some publishers are still reluctant to move away from it to embrace header bidding.

The question, however, is which is better: header bidding or waterfall bidding?

To properly understand why it is your better option, we need to briefly look at what waterfall bidding is and its pros and cons.

What Is Waterfall Bidding, and How Does It Work?

Waterfall bidding is one of the earliest forms of programmatic bidding.

Waterfall bidding is an old-school way of ad serving in which publishers set a floor price for their ad space. The publisher sets the priority for each advertiser or ad network they’re connected to.

When selling ad impressions using the waterfall bidding process, inventory is offered to advertisers at a fixed minimum price per impression. The first ad network to bid at that price gets the slot.

Another important aspect of waterfall bidding is that the bidders don’t get to bid randomly. Networks that rank higher, thanks to higher historical yield, get dibs on bidding.

In a sense, waterfall bidding isn’t accurate bidding at all.

The most significant disadvantage of …read more

Source:: Kiss Metrics Blog

Author: Aaron