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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

1/6
ask #1▤Publisherone ad slot⇄Network 1floor $3⇄Network 2floor $2⇄Network 3floor $1⇆Prebid wrapperin the page header▣Ad serverpicks the best
1
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.

  1. 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.
  2. 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.
  3. 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.
  4. 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.
  5. 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.
  6. 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

  1. 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.
  2. 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.
  3. 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.
  4. The new way: ask everyone at onceHeader bidding puts a wrapper like Prebid in the page. It sends the request to every partner simultaneously.
  5. 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.
  6. 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.

Read the full lesson