Waterfall vs header bidding
Why publishers moved from asking buyers one at a time to asking them all at once, and how it raised their revenue.
Waterfall vs header bidding
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The old way: a waterfall
In the waterfall, the publisher offers the slot to one partner at a time, in a fixed order, each with a floor price.
- The old way: a waterfall: In the Waterfall (daisy-chaining), the publisher offers the slot to one partner at a time, in a fixed order, each with a floor price.
- Pass… pass…: Network 1 has nothing worth $3 for this visitor, so it passes. The slot trickles down to Network 2, then Network 3. Every hop adds delay.
- Money left on the table: Network 3 takes it for $1.20. But Network 2 had a buyer willing to pay $2.80. It was never asked the right way. The order, not the price, decided who won.
- The new way: ask everyone at once: Header bidding puts a wrapper like Prebid in the page. It sends the request to every partner simultaneously.
- Real prices come back: Everyone answers with a real price within a timeout (typically 1–1.5 seconds on the web): $2.10, $2.80, $1.20.
- The ad server decides on price: The best header bid ($2.80) is passed to the publisher ad server, which compares it with direct deals and other demand. The highest price wins. Publishers typically earned noticeably more after switching.
Step by step
- The old way: a waterfallIn the waterfall, the publisher offers the slot to one partner at a time, in a fixed order, each with a floor price.
- Pass… pass…Network 1 has nothing worth $3 for this visitor, so it passes. The slot trickles down to Network 2, then Network 3. Every hop adds delay.
- Money left on the tableNetwork 3 takes it for $1.20. But Network 2 had a buyer willing to pay $2.80. It was never asked the right way. The order, not the price, decided who won.
- The new way: ask everyone at onceHeader bidding puts a wrapper like Prebid in the page. It sends the request to every partner simultaneously.
- Real prices come backEveryone answers with a real price within a timeout (typically 1–1.5 seconds on the web): $2.10, $2.80, $1.20.
- The ad server decides on priceThe best header bid ($2.80) is passed to the publisher ad server, which compares it with direct deals and other demand. The highest price wins. Publishers typically earned noticeably more after switching.