At the recent Ad Revenue Europe conference in London a group of senior publisher executives debated the current state of inventory allocation, and how publishers view the legacy waterfall and the more current header bidding technologies. During the panel, Ed Thomas, Head of Audience for Skimlinks, stated, “We’re working with publishers to identify what that loss [from using waterfalls] looks like, and in some cases it’s colossal – as much as 50%.” Although the waterfall tactic—i.e. when a publisher’s ad server sequentially calls on demand sources in predetermined priority—once seemed like a logical solution for yield management, in practice, waterfalls lead to lost revenue and operational inefficiencies.
With waterfalls, publishers lack control of their inventory and transparency into buyers willingness to pay, and as a result, are leaving significant revenue opportunities on the table. Header bidding technology solves for these deficiencies with a simple implementation. A publisher places a JavaScript tag (header tag) within their website, and when the publisher’s ad server calls for an ad impression, the header tag presents information that helps unify all sales channels into one view and identify which channel offers the highest CPM on an impression-by-impression basis.
PubMatic’s header bidding technology, Decision Manager, helps publishers increase monetization while allowing them to keep control over their inventory. Publishers can achieve the highest yield on each impression, while retaining control of monetization levers such as demand source selection (unique to Decision Manager, publishers can see a unified view of both direct and indirect sales channels), CPM thresholds and campaign pacing. These controls ensure that the publisher’s operations teams have the levers necessary to meet monetization goals and ensure favorable treatment to certain demand sources, if such a need were to present itself (as we know that happens sometimes!). This environment drives up competition amongst buyers, generates revenue opportunities and thereby increases the return on a publisher’s inventory.
One leading news publisher was able to increase value of their digital assets after integrating PubMatic’s Decision Manager. The company saw a 70% increase in average CPM and a 63% lift in revenue, all within the first four weeks of initial integration.
While Decision Manager can deliver immediate, short-term results, the product can also deliver sustainable results. Earlier in the year, a leading premium publisher set out to accelerate digital ad revenue and increase its inventory fill rates. Through PubMatic’s consultative approach, the publisher was able to leverage its header tags fully. This resulted in Decision Manager being able to monetize a larger share of the publisher’s inventory, evidenced by a 300% increase in revenue and 9% increase in fill-rate (i.e. inventory sell-through) five months after implementation.
Ad serving and inventory allocation will continue to improve as technology advances. On Ed Thomas’ panel at Ad Revenue Europe in October, panelists were asked by the moderator if they “don’t like waterfalls,” and all of the five panelists raised their hands. It’s clear that there is an enormous opportunity to develop technology that truly solves for waterfalls’ inadequacies. At PubMatic, we are working hard to develop the next innovative solution to solve all yield management and monetization challenges, across all devices and platforms. For more information on Header Bidding and Decision Manager, please reach out to your PubMatic sales representative, or contact us here and someone will follow up.
