This new technology is changing web advertising

businessinsider.com

A new technology is taking root among publishers.

Header bidding - also known as tagless, advanced, or pre-bidding - has truly picked up steam among publishers in the last year thanks to its pledge to reduce inefficiencies in programmatic advertising by maximizing publisher yield and boosting ad revenue.

Almost 70% of publishers have adopted this new technology compared to almost zero publishers two years ago, Tom Shields, SVP of Publisher Strategy at AppNexus, told BI Intelligence, Business Insider's premium research service.

Here's how it works. Publishers that use header bidding technology insert javascript code from a third-party provider into their page headers, which is the portion of a page that contains different codes to track analytics and serve ads.

This code allows chosen demand sources such as ad exchanges, ad networks, or demand side platforms (DSPs)to bid on all the ad inventory available on the page even if that inventory was already sold through direct buys.

Publishers get several advantages from header bidding tech. For starters, a publisher can view all the bids simultaneously and then choose which bids it will accept, compared to a traditional programmatic waterfall auction in which particular bidders get preferential treatment based on their expected value.

Secondly, header bidding reduces passbacks, which often occur when a publisher's main ad network or exchange cannot fill an impression request because the publisher's established floor CPM is too high or there are no available ads to serve the publisher. Header bidding eliminates this problem because publishers can see in advance if an ad network or exchange can bid on an impression.

Finally, it curbs Google's preference for its own ad exchange, AdX. Many publishers use DoubleClick For Publishers (DFP) as an ad server, and DFP typically gives preferential treatment to AdX. Header bidding equalizes the playing field to avoid this situation.

Header bidding is a relatively new phenomenon, but it has picked up momentum among publishers. And there's plenty more to learn about this technology.