When I joined Index Exchange in July, I had no idea WTF a header tag was and how it related to a programmatic auction. However, the internal enthusiasm for this thing instantly struck me. Given the excitement and well-argued point of view that running an auction through a header tag could very well alter programmatic forever, I knew it was something that the research department needed to dig into. Thus, Index Exchange’s first research piece focused on header tag-run auctions.
With that project we sought to test three hypotheses: 1) Header auctions increase publisher yield, 2) Brands can better execute their audience procurement strategies in header auctions, and 3) User experience improves when publishers sell programmatic ads in header auctions.
We found that header run auctions:
- Increase publisher yield. When publishers represent a full spectrum of inventory to every buyer, more bid density is injected into the publisher’s ad stack and results in higher clear prices. In our original research piece, we found that in Q2 2015, compared to impressions sold through tag-based integrations, impressions sold in header tag auctions cleared 166% higher in the open market and 46% higher in PMPs.
- Improve user experience. Ask any digital publisher and they’ll tell you: the amount of time it takes a page to load negatively affects user experience and audience retention. Tag-based run auctions make a page load a lot slower than header auctions – in Q2 2015 78% of header tag auctions were completed in 200 milliseconds or less, while the majority of tag-based auctions took 400 milliseconds or more.
Six months later and enthusiasm around header tag has only swelled. Today it’s time to take another look. Below find information on the role header played during the second half of 2015 within the Index Exchange marketplace.
The Cast of Characters: Who’s Buying and Selling Through Header
Compared to tag-based, it takes a bit more work to get a header tag up and running. This is related to a few factors: organizational, technical, and operational.
- Organizationally, more individuals tend to be involved in a header tag integration. We’ve found usual parties include programmatic sales, ad ops, web development, and of course, the programmatic sales platform with which the publisher is integrating.
- Technically, header tag integrations require the publisher (or exchange partner) to take on some web dev heavy lifting.
- Operationally, integrating through a header can be a painstaking process if the onus falls on the ad ops team to handle the operational aspects of an integration.
That said, from Q3 to Q4 2015, the number of header-tag integrations has steadily grown. This is in part thanks to the fact that Index Exchange’s client services and technical account teams handle as much heavy lifting during the integration process as the publisher is comfortable with. Over the past six months, we’ve seen:
- New relationships with new publishers (and closer ones with legacy tag-based clients). The number of publishers or publisher networks (i.e. publishing companies responsible for a number of digital properties) with which we’re header integrated has risen steadily from July to December.
- An explosion of the number of URLs selling inventory through header. The number of domains selling inventory through header has steadily increased over Q3 and Q4 of 2015. In July 2015, we saw inventory from around 2,500 domains and as of late December that number rose to approximately 6,200. That’s a growth rate of about 150%.
- Fresh demand. As we integrated with a handful of new publishers and scaled the scope of our relationship with many legacy clients over the past six months, demand has swelled. Over the course of Q3, 700 global brands spent at least $4,000 in header-tag run auctions. By the end of December, over 1,000 brands met and/or exceeded that threshold within header-tag run auctions.
- The creation of exclusive opportunities through unique partnerships. A number of publishers find header is an excellent way to run PMPs. Header allows publishers to fully expose buyers to cream of the crop inventory. For publishers who leverage a heavy direct deal private marketplace set-up, header allows for flexible, custom deal architecture. Publishers less focused on direct deals can place their private buyers at “price priority”, which means if the highest bid that comes through in an auction is from a fixed private buyer, the impression will automatically go to the private buyer if an open bidder doesn’t bid higher.
Market Dynamics: By Marketplace and Integration Type
Figure 1: Number of Header Tag Auctions Increased Steadily Over Period
The graph above depicts growth of header-tag auctions from July to December of 2015. The blue line signifies “header tag bid requests”, which really just means how many times a programmatic auction took place. “Header tag auctions won” signifies the number of times demand (i.e. buyers) from Index Exchange’s market placed the highest bid in a header tag auction.
Figure 2: Open Marketplace Spend and Impressions Won by Integration Type (Q3 2015)
Figure 3: Private Marketplace Spend and Impressions Won by Integration Type (Q3 2015)
Figure 4: Open Marketplace Spend and Impressions Won by Integration Type (Q4 2015)
Figure 5: Private Marketplace Spend and Impressions Won by Integration Type (Q4 2015)