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Dynamic Bid Floor Best Practices

Overview

Some ad sources (i.e. Rubicon, Pubmatic, etc.) support the ability to pass in a bid floor in the ad request (i.e. a dynamic bid floor), rather than using a static bid floor set within the ad source platform. This dynamic bid floor provides flexibility for publishers to request different pricing for specific inventory without having to set up a new ad slot and bid floor within the ad source platform.

Ad sources that support passing a dynamic bid floor also support sending in a dynamic price in the ad response, giving buyers a better chance to win the auction and allowing publishers to get a more accurate understanding of how their inventory is valued. Ad sources that support passing a dynamic bid floor and returning a dynamic bid price are much more competitive within a single unified auction.

Two separate price fields are available within the AerServ UI for every ad source that supports dynamic bid floors. This document explains the difference between the two price fields and how they should be utilized to maximize fill and revenue.

The two price fields are 'Bid Floor' and 'Target Price'. If an ad source does not support the ability to send in a dynamic bid floor, then only the 'Target Price' field will be provided because the buyer price will never change.

 

Table of Contents

 

Definitions

 Target Price (Soft Floor) Bid Floor (Hard Floor)

This is the expected or target price that a publisher wants to be paid for their inventory.

A publisher may be willing to accept a bid price lower than this if they specify a lower price for the 'Bid Floor'. 

This is the minimum amount a publisher is willing to accept for their ad request.

If an ad source provides a bid below this bid floor it will be thrown out and not be eligible to win the auction. 

 

 
Note: 'Target Price' was previously labeled as 'CPM' in the UI, but the name was changed to reflect the new functionality.

 

  

Best Practices & Tips 

 

   Feel free to use the same value.

 

A publisher can always enter the same value for the 'Bid Floor' and the 'Target Price', but specifying a 'Bid Floor' lower than a 'Target Price' will improve their fill rate chances.

 

   Target price must be higher.

 

The 'Target Price' can never be lower than the 'Bid Floor'.

 

   Keep target price reasonable.

 

A publisher should not set the ‘Target Price’ too high. Not all ad sources will return a bid below the bid floor specified in the ad request. If the bid floor sent in the ad request, which comes from the ‘Target Price’, is too high then they may not bid at all, so it important to set a ‘Target Price’ that is reasonable.

 

 

Examples 

Here are some examples to help explain how the two price fields can be used.

A publisher wants to be paid $7 (Target Price) from Ad Source A, but they will accept any price above $5 (Bid Floor). Specifying a bid floor lower than the target price increases the chances of receiving a filled ad response from Ad Source A.

The ad request is sent to Ad Source A with a bid floor of $7 (Target Price), but when Ad Source A responds with an ad, the AerServ ad server will only throw out ads below $5 (Bid Floor). Even if Ad Source A returns an ad below the bid floor ($7) sent to them, but it is above the internal bid floor ($5), it will be accepted as a valid bid and will be eligible to win the auction.

The Target Price ($7) acts as a soft floor while the Bid Floor ($5) acts as a hard floor.

  

 

Example 1      Ad Source Supports Dynamic Bid Floors
     
   

 Target Price:  $7.00

   

→ Ad request sent to ad source with a 'Bid Floor' of $7.00.

→ Ad source responds with an ad at $8.00.

 

   

Bid Floor:  $5.00

     → Ad is accepted because it is above the actual $5.00 'Bid Floor' and is available to win the auction.

 

 

 

Example 2      Ad Source Supports Dynamic Bid Floors
     
   

 Target Price:  $7.00

   

→ Ad request sent to ad source with a 'Bid Floor' of $7.00.

→ Ad source responds with an ad at $6.00.

 

   

Bid Floor:  $5.00

     → Ad is accepted because it is above the actual $5.00 'Bid Floor' and is available to win the auction.

 

  

 

Example 3      Ad Source Supports Dynamic Bid Floors
     
   

 Target Price:  $7.00

   

→ Ad request sent to ad source with a 'Bid Floor' of $7.00.

→ Ad source responds with an ad at $4.00.

 

   

Bid Floor:  $5.00

     → Ad is not accepted because it is below the actual $5.00 'Bid Floor' and is not available to win the auction.

  

 

 

Example 4      Ad Source Supports Dynamic Bid Floors
     
   

 Target Price:  $5.00

   

→ Ad request sent to ad source with a 'Bid Floor' of $5.00.

→ Ad source responds with an ad at $5.00.

 

   

Bid Floor:  $5.00

     → Ad is accepted because it is equal to the actual $5.00 'Bid Floor' and is available to win the auction.

 

 

 

Example 5      Ad Source Supports Dynamic Bid Floors
     
   

 Target Price:  $5.00

   

→ Ad request sent to ad source with a 'Bid Floor' of $5.00.

→ Ad source responds with an ad at $4.00.

 

   

Bid Floor:  $5.00

     → Ad is not accepted because it is below to the actual $5.00 'Bid Floor' and is not available to win the auction.

 

 

Example 6      Ad Source Does Not Support Dynamic Bid Floors
     
   

 Target Price:  $7.00

   

→ Since Ad Source A does not send back a dynamic bid price the static historical price must be used, so any filled ad response will be accepted and considered above the bid floor and will be available to win the auction

 

 

 

 

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