Video Header Bidding: The Publishing Industry’s Biggest Buzzword or Misnomer?

Inplace #2

Header tags were arguably the biggest trend to come out of the programmatic space in 2015, and were poised for terrific potential as we entered 2016.

Over the course of the past year, the hype did not disappoint. We saw header tags decimate the traditional waterfall-structured auction, allowing all DSPs, marketers and agencies to bid at the same time, side-by-side and in real time for the same inventory.

This upped both yield and revenue for publishers, while programmatic buyers liked that they could workaround the stronghold Google had built with DoubleClick and AdX.

It’s a Wrap

Next we saw the emergence of wrappers, which made header bidding technology scalable across many partners. Wrappers, or containers, address issues of latency that plagued basic header bidding implementation by helping publishers to add and manage demand sources without slowing down load times, incorporating each bidder into a single framework designed to execute header bidding requests in parallel. They also alleviate the huge time and cost associated with adding individual exchange partners to multiple websites. Once implemented, they are far easier to manage, and today play an essential role in a mature header bidding solution, especially given that multiple header bidding partners are necessary for proper monetization.

In much of the same way that header bidding technology was poised to evolve the industry at the beginning of 2016, the implications for publishers who have video header bidding capability have already started to dominate the conversation in looking ahead to 2017. But what do we mean by “video header bidding?” After all, a video player is a piece of embedded technology within a website’s pages; it’s oftentimes a third-party product, and may not have a presence within the header code of those pages at all.

However, this is not to say that the spirit of header bidding can’t be implemented for video. Publishers can still open up their video inventory to all demand sources at the same time, in real time—it just looks a bit different than the header bidding we’ve grown accustomed to with display.

Understanding Video Header Bidding

Video header bidding essentially runs the same sort of auction as display header bidding, but does it for video advertising, and runs it while the video player is loading. In this way, it is directly analogous to display header bidding: display header bidding runs while the page loads, and video header bidding runs while the video player loads. And, just as display header bidding evolved to offer easy-to-integrate wrappers for managing multiple partners, so too are vendors beginning to roll out equivalents for video.

Because integration takes place in the video player, not the page, video header bidders are finding that it is as important to approach the owners of the video player technology as the publishers who own the video content – in fact, probably more important. Video player vendors with a full OVP can roll out header bidding to an entire network of publishers, as long as they have the right relationship with those customers.

The end results of implementing video header bidding can be profound. Not only do publishers enjoy uplift in CPMs and fill, but there’s a hidden – and perhaps surprising – benefit that’s not necessarily present with display header bidding. The benefit is a boost to the load times of ads within video players.

If you’ve ever run third-party video ads, you know that: a) winning bidders often don’t actually have an ad for you to play: and b) ads can take a long time to load. The latter is a nasty side effect of the VPAID standard, which has been abused by many third parties to run hidden sub-auctions using code with extended timeouts. And sometimes their code does not even work. All of this leads to a subpar viewer experience, and can drive viewers away before the ad even loads.

Rebooting the Video Advertising Ecosystem

So far, video header bidding is dominated by a small group of participants who are either only running their own direct ads, or gating participation to trusted third parties. In some sense, it’s a restart of the video advertising ecosystem, and that’s good news for those few video players and video content publishers who are taking advantage of video header bidding. Ads load quickly and reliably, such that they are ready to play as soon as the video player has loaded, reducing or even eliminating revenue-wasting latency.