Header Bidding vs. Open Bidding | header bidding open bidding

Header Bidding vs. Open Bidding: Header bidding and open bidding are both programmatic advertising techniques used to maximize ad revenue for publishers and increase competition among advertisers. While they have similarities, they operate in slightly different ways

What is Header Bidding:

Header bidding is an advanced programmatic advertising technique that allows publishers to offer their ad inventory to multiple demand sources simultaneously before making a call to their ad server. Here’s how it works:

• When a user visits a website, the publisher’s web page sends out bid requests to multiple ad exchanges or demand partners, including ad networks, DSPs (Demand-Side Platforms), and SSPs (Supply-Side Platforms).
• Advertisers can respond with their bids in real time.
• The highest bid wins, and the winning ad is displayed on the page.

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Advantages of header bidding:

a. Increased competition: Publishers can get bids from multiple sources simultaneously, increasing the competition and potentially leading to higher CPMs (Cost Per Mille) and revenue.

b. Better inventory management: Publishers have more control over their ad inventory and can sell it to the highest bidder.

c. Improved fill rates: Header bidding often leads to higher fill rates, as all demand sources have an opportunity to bid on impressions.

What is Open Bidding (Unified Auction):

Open bidding, also known as unified auction or exchange bidding, is a more recent development in programmatic advertising. It’s a server-to-server technology that allows publishers to offer their inventory to multiple demand sources in real time, just like header bidding. However, open bidding streamlines the process and offers some differences:

• Open bidding takes place in the cloud, with no reliance on the user’s browser.
• Advertisers submit their bids to a unified auction in the cloud, and the winning ad is determined there.

Advantages of open bidding:

a. Reduced latency: Open bidding typically has lower latency than header bidding since the auctions happen in the cloud.

b. Simplified setup: Open bidding often requires less technical implementation compared to header bidding.

c. More demand sources: It can support a broader range of demand sources, including header bidding partners, mobile app demand, and more.

Conclusion:

Header bidding and open bidding are both strategies for increasing competition among advertisers and maximizing ad revenue for publishers.

Header bidding is more established and has been widely adopted, while open bidding is a more recent innovation aimed at improving efficiency and reducing latency in the programmatic advertising process.

Publishers may choose one or a combination of both techniques to optimize their ad revenue.

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