Pros and Cons of Header Bidding in Digital Advertising

In the programmatic advertising world, it can sometimes seem as if change is the only constant. Take the emergence of header bidding for example. This service has been gaining popularity in the advertising world for the past year or so and is rapidly becoming the go-to option for many top publishers. But, what is it really?

To put it simply, header bidding is akin to a bidding war. It is a browser-based approach that gives publishers the ability to offer programmatic inventory for sale before the ad servers decides which campaign they are going to use.

This preview of sorts helps publishers determine the true value of an impression on the programmatic marketplace, without an obligation to sell. In this way, header bidding gives publishers the ability to offer the impression for sale in real time, compare bids, and sell to the highest bidder.

Pros

• Offers publishers the chance to see an up to 50% increase in CPM and, as a result, revenue as well.
• Provides advertisers with the first choice of premium inventory before an ad exchange.

Cons

• Dependent on the complexity of the website, each individual publisher will have a different experience with header bidding. To ensure success, publishers must hire AdOps specialists who can input and update code on a regular basis.
• Gaining access to premium inventory isn’t cheap. This may not be a big deal to advertisers who have big budgets to work with, but it can be disastrous for smaller brands. And because header bidding companies have total access to publisher inventory, advertisers can no longer take advantage of guaranteed deals with publishers.

The Bottom Line

Header bidding gives publishers the ability to increase their revenue while simultaneously providing advertisers with access to viewable, premium inventory. Furthermore, there is evidence about brands that use header bidding noticing significant increases in their ROI. In short, header bidding’s advantages far outweigh the negatives.