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SERVER SIDE HEADER BIDDING - Index Exchange€¦ · Server side (s2s) integrations have existed in...
Transcript of SERVER SIDE HEADER BIDDING - Index Exchange€¦ · Server side (s2s) integrations have existed in...
5 QUESTIONS TO ASK WHEN CONSIDERINGSERVER SIDEHEADER BIDDING
25 Questions To Ask When Considering Server Side Header Bidding | MARCH 2017
IntroductionServer side (s2s) integrations have existed in programmatic
advertising for nearly a decade, having been the preferred
method of integration between DSPs and exchanges
during that span. Yet this integration type is only now being
considered for header bidding, and quite tentatively at
that. The obstacle that has challenged the industry in its
shift from client side to server side header bidding has not
been technology, but trust. With s2s being a more opaque
integration, exchanges were previously hesitant to cooperate
within an environment that lacked the transparency inherent
in client side header integrations. A recent shift towards
s2s by larger tech giants has to an extent normalized this
integration, and incidentally paved the way for independent
exchanges to partner together to embrace s2s, and
create a new choice for publishers hoping to enhance
user experience and monetization without sacrificing
transparency and fairness.
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Before we dig into the specifics of s2s, here’s a quick refresher of header bidding and header bidding wrappers.
Header bidding is a process facilitated by a snippet of JavaScript in the header of a webpage that allows publishers to auction ad impressions in a flat parallel auction that can include multiple participants. This was a hugely impactful advancement to inefficient sequential auctions conducted in the waterfall era of programmatic.
A wrapper (also known as a container or container tag), was the natural progression of working with multiple header bidding partners. Rather than each partner’s client side header bidding integration sitting on page, individually managed by a publisher, one technology acts as a wrapper and can call (or “wrap”) multiple header bidders. This single point of integration allowed publishers to easily monitor and manage multiple header bidding partners for the first time.
A wrapper can either perform its functions of calling bidders on page so that every call runs through the browser, known as client side, or more recently, it can also operate server side conducting those calls outside of the client browser (also known as server to server, or s2s). There are discrete advantages to both solutions and some sizeable trade-offs involved. So, how does a media company decide how to operate their wrapper? We’ve put together a few questions to help you through the process.
Advantages:
Inherently transparent
Direct user sync
Advantages:
Reliability of connections
Low Latency
Capacity for many partners
Client Side
Server Side
Disadvantages:
Potential to be unreliable
Higher latency
Limited capacity for partners
Disadvantages:
Can be opaque
Indirect user sync
Figure 1
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How Will This Impact User Experience? There are two core factors that impact latency in a wrapper
integration: connection based latency - how long it takes to
initiate a request, and locational latency - comprising the round
trip of the distance that must be traversed between the user,
wrapper, exchanges, and DSPs. Let’s take a closer look at each.
Connection-Based LatencyIn a traditional client side integration, the wrapper makes a call to each exchange via the user’s
browser. These ad calls are processed alongside a massive amount of other requests like images,
fonts, videos, audio, and everything else that makes a website worth visiting. There are a finite number
of items the browser can process at once, and the browser decides the priority. This means that calls
related to header bidding can become heavily delayed.
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User/Browser User/BrowserData center co-location
IntegratedExchanges
DSPs
0ms
0ms
Exchange/Wrapper
40ms
15ms
5ms
Integrated Exchanges DSPs
Co-location allows for lightning fast communication via direct connection, enabling more time for the auction
Figure 2a Figure 2b
s2s integrations are not a cure all – new latency can be introduced without advanced infrastructure
Exchange/Wrapper
Figure 2a Figure 2b
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Index Exchange adapted its technology early-on to be browser friendly
and lightweight to browser connections, requiring only a single call (single
request architecture), regardless of the number of ad slots on any given
page. This significantly reduces the impact of connection-based latency.
Comparatively, in a server side integration, rather than call every single exchange individually (even
multiple times) via the browser, the wrapper makes a single client side call to its server, which then
calls the exchanges server side. This creates an environment in which multiple exchanges can be
called reliably and simultaneously, without being at the mercy of the browser. Unlike the browser on
a user’s mobile phone or computer, the servers used for this are specialized machines built to handle
massive quantities of concurrent requests without negatively impacting latency or user experience.
Locational Latency With s2s, there should be an increased focus on Location Based Latency wherein we consider each leg
of the journey as well as the speed (or latency) of the round trip for the wrapper to make its initial call
to all of the integrated exchanges and return the clear price to the ad server. When we move the core
functions of the wrapper from the user’s browser to the server, we are creating a distance between
the user and the wrapper that must be traversed. This distance, along with the distance between the
wrapper server and the servers of the 3rd party exchanges, as well as those 3rd party exchanges to
their DSPs/buyers are important to consider, since a weak link in this chain can bring new latency into
the equation. Speed and infrastructure go hand in hand, so co-location and data center distribution
must be seen as a key consideration of vendor selection.
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How will this impact my overall RTB revenue? This is both the most important question for publishers and
the hardest to predict. There are two key factors to consider
when examining the projected change in revenue.
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Incremental DemandThe key draw for many publishers considering s2s is the ability to add additional demand partners
without negatively impacting latency. This particular selling point is often overstated and heavily
nuanced. While you can run many exchanges s2s, it’s important to understand how much additional
value you will actually be adding with each partner. A more impactful goal for s2s is the amount of
premium incremental demand that can be added without negatively impacting latency. For each
additional exchange to add incremental value, there has to be a substantial amount of unique demand,
priced to compete with direct sales, and technologically able to respond to the demands of an ever
decreasing timeout. Today there are currently a handful of exchanges that match this description,
and running partners outside of this criteria may bring unnecessary exposure to poor quality ads, over
exposure of requests to DSPs, and ultimately the potential for gaming.
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Server side connections provide speed and reliability, but lack direct access to users
Wrapper Client
1 2 3
1 2Server Side Wrapper
Users 1, 2
Exchange AResult: Low Latency Connection
Exchange BResult: Low Latency Connection 2 31 3
Server Side Call
Client Side Call
KEY
Figure 2
1 2
Exchange CResult: Low Latency Connection
Figure 3
Identifying UsersUser sync (aka cookie sync, cookie matching, or user matching) is the ability to recognize a user,
allowing platforms (i.e. DSPs) to ascribe value to that impression. This is specific exclusively to
desktop and mobile web environments, not app where user syncing is replaced with device identifiers.
95 Questions To Ask When Considering Server Side Header Bidding | MARCH 2017
In a client side integration, cookie matching is a straightforward process with a direct line of
communication between each exchange and the user’s browser.
In an s2s integration, only the wrapper has a touchpoint with the user’s browser. As such, a 3rd party
exchange participating in the wrapper relies on the wrapper having conducted a match of its user
data, since it must first perform a match with the wrapper before it can perform a DSP match. Without
user data, impressions have diminished value to buyers, therefore any decrease in user sync rate can
have a significant negative impact on revenue
Figure 3
Client side connections have better user matching, but are slower and less reliable
1 2 3
Wrapper Client
1 2 3
1 2 3
Exchange A Result: Full User Match
Exchange B Result: Full User Match
Exchange C Results: Unknown
Server Side Call
Client Side Call
KEY
The number of exchange partners integrated client side must be limited due to latency impact
Figure 4
Client side connections have better user matching, but are slower and less reliable
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How will this impact transparency and fairness?As publishers know all too well, transparency is key for creating a
fair auction that ensures impressions go to the highest bidder and
surprise fees aren’t shifting dollars from the publishers’ pockets to
middle men buried in the supply chain. Bringing the wrapper server
side innately introduces new risks to transparency, which must be
closely monitored. When the wrapper resides in the browser, every
part of the process is available for inspection. This is not the case for
the server side integration.
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The Index wrapper re-introduced transparency by providing robust
reporting and log level data to both publisher and 3rd party exchanges.
Fairness is further cemented by creating an A/B testing framework
between client side connections (fully transparent) and server side (less
transparent) connections, putting control and choice squarely into the
hands of the publisher.
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The IX wrapper gives publishers a choice of how to set up their wrapper to ensure the best balance of user experience and revenue, and the tools to make a data driven decisions
Server Side Call
Client Side Call
Wrapper Client
1 2 3
Exchange A Result: Full User Match
Exchange B Result: Low Latency Connection
Exchange C Result: Low Latency Connection
Server SideWrapper
1 2 3
1 3 2 3
1 2
KEY
Pricing TransparencyMake sure you are aware of any charges for 3rd party exchanges for participation in their s2s offering.
This can correspond to a reduction in participation and a decrease in working media.
Figure 5
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Index Exchange has not charged fees for its client side wrapper,
and will not be charging fees for its server side wrapper. We believe
exchanges should only be compensated when they source and provide
the highest net bid for publishers, thereby increasing publisher revenue.
Auction Dynamic TransparencyThe move server side also introduces mediation for most wrapper offerings. A mediated wrapper
runs an additional auction amongst wrapper participants and passes a single winning price to the ad
server (or a second in the event of deal based bid handling), rather than passing a price for every single
exchange. This is desirable to publishers for the increase in scalability gained by streamlining line
items in their ad server. With auction dynamics being managed across all 3rd party exchanges by the
wrapper provider, it’s important to learn about those dynamics and ensure this aligns with the goals
of both publisher and buyer. Be on the lookout for a lack of disclosure and built-in advantages for the
operator of the wrapper that might deter buyers. If the wrapper provider also has a buy-side business,
it’s a strong hint to look closer and get everything in writing.
The Index wrapper offers full transparency to both publishers and
partners alike on pricing and auction dynamics. There are no advantages
built into the Index bidder and we aim only for a flat, fair auction driving
the best price for publishers, regardless of the source. The auction
dynamics of the server side integration are the same as the client side
integration, continuing the level playing field for all participants for which
the Index is known.
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Do I have to move all of my partners to s2s at once?No. The quick rise in popularity of s2s header bidding has thrown the
industry into flux, and it may take time for every exchange to catch
up in the technology and trust required for an effective s2s bidder
integration. In the meantime, publishers should have the option to
begin testing with exchanges as they do become ready. An either/
or approach will be unnecessarily limiting to publishers who want to
begin testing and learning now. Most importantly, publishers should
ensure that they can make data-driven decisions about where each
partner performs best in terms of user experience and revenue before
shifting everything server side.
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Choice: Support for server side and client side connections, by partner
Transparency: Clear auction dynamics and fee structures for publishers, partners, and buyers
Tested: A/B testing capabilities to show the impact to speed and revenue by partner based on integration type
Service: White glove service to take on the heavy lifting of implementation and upgrades
Technology: Reliable technology, robust infrastructure, and broad global data center distribution with strategic co-location
Fair: Free of fees and conflicting interests
What should I look for in a s2s provider?
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ConclusionWhile it can be easy to get caught up in the potential user experience
upsides of s2s, there are clearly many variables to take into consideration
as the market evolves. To respond to this, Index has kept our focus on
putting the choice into the hands of publishers by offering both client side
or server side integrations, by partner, within the same wrapper.
Publishers will have direct control over critical aspects of their server side
wrapper auction, including the partners involved, timeout thresholds, and
deal handling to ensure they have the tools to make the right decisions
for their business.
About Index Exchange
Index Exchange is an advertising marketplace where premium digital media companies can sell their
ad impressions transparently, in real time, to programmatic buyers. Built on the pillars of neutrality,
openness, and the most reliable technology, we aspire to be the ad exchange that media companies
can trust.
Because we are independent, with no other business interests, the top technology companies in the
industry choose to partner with us and together, we build better solutions with media companies in
mind. And we’re independent by choice, because that lets us make decisions for the long-term benefit
of our clients, not the immediate demands of investors, or for short term profits. We believe greater
competition leads to better yield for media companies and better inventory access for marketers.