In-App Header Bidding: How to make more money with it? [7 Benefits Included]

This post was most recently updated on January 18th, 2023

Introduction

While mobile app revenue is estimated to cross the $900 billion mark by 2023, only 10% of app publishers monetize their app’s traffic.  Imagine global app revenue crossing the trillion-dollar mark once the majority of app publishers harness more programmatic advertising techniques to scale their ad revenue?

In-app bidding has been the secret sauce of the 10% of app publishers who are killing it in mobile advertising. In this article, we’ll explore how in-app header bidding works and why you should consider using it for scaling your app monetization.

What Is In-App Header Bidding?

In-App Header Bidding is a kind of programmatic advertising technology integrated into an app’s SDK for monetizing app traffic. Publishers can use In-App Header Bidding to simultaneously offer their ad inventory to multiple demand partners through this programmatic advertising technology, guaranteeing a real-time, unified auction. This means publishers can maximize revenue for themselves by selling more ads in exchange for higher CPMs than any single partner could offer on its own.

To maximize revenue for the publisher, ongoing auctions create competition among bidders for all in-app ad impressions. If you don’t want your valuable app monetization strategy to be hijacked by one or two players who pay top dollar but don’t deliver value back (or if you’re simply looking to diversify your revenue streams), In-App Header Bidding might be right up your alley!

Problems with the In-App Waterfall Model

Publishers traditionally prioritized impressions based on historical performance data from demand sources. Throughout the waterfall, inventory was allocated source to source until all addressable impressions were filled.

This approach, however, makes the process not competitive enough since only one ad network is allowed to buy an impression at a time. Unlike real-time bidding, waterfall technique often results in lower yields for publishers because primary demand partners bid in sequences rather than in real time.

A first-ranked ad network has the main call on responding to a request over other ad networks. Consequently, higher-paying advertisers can’t bid more, decreasing revenue uplift opportunities. Furthermore, if an ad falls further down, it doesn’t get called, and potential revenue opportunity is lost.

Related Read: https://www.monetizemore.com/blog/evaluate-adops-setup-header-bidding-vs-waterfall/

In-App Header Bidding vs. Web Header Bidding

In-app header bidding came up as a transparent & justifiable way of auctioning and buying ad inventory. Compared to the traditional in-app advertising waterfall method, in-app header bidding lets all buyers simultaneously bid on the same ad inventory with the highest bidder always winning.

The process for this method is almost the same as website header bidding. Website header bidding occurs via header bidding wrappers, which are JavaScript tags responsible for evaluating bids, ad server communication, & ad calls to the demand partner. Ultimately, it’s always the highest bidder winning the real-time auction with their ad popping up on the publisher’s page.

How Does In-App Header Bidding Work?

So how does in-app header bidding work? You might be surprised to learn it works very similarly to web header bidding, but there are some key differences that you need to know.

First off, all bids are sent through a server-to-server connection between the publisher’s ad stack and demand partners. This is where you’ll find the big difference between in-app and web header bidding: In-app, this communication takes place directly on your device rather than going through an external network like HTTP or HTTPS.

To avoid confusion with web header bidding, in-app header bidding now goes by terms like advanced bidding, parallel bidding, and unified auctions. But how does this translate into actionable results for advertisers? Let’s break down your options:

The substitution is an SDK kit in the app for the embedded piece of code in the site’s header.

What Is The Difference Between Header Bidding And Unified Auctions?

Unified auctions, also known as server-side bidding or programmatic direct, are optimized for mobile app environments because they are designed specifically for mobile app trading. Both header bidding and unified auctions aim to maximize demand for advertising inventory, but their working mechanisms vary.

Mobile app environments benefit from unified auctions because they are designed specifically for mobile app trading. Only one bidding session per impression takes place in unified auctions while header bidding takes bids from multiple auctions.

A unified auction environment allows all demand sources (server-side programmatic demand sources & client-side SDK mobile ad networks) to fight for each ad impression simultaneously. Since unified auctions are transparent, app developers can estimate the pay-per-impression from demand sources.

The benefits of Unified Auctions for Publishers

Here’s a list of benefits you can get from a unified auction:

1. Reduced latency – As we’ve seen earlier, unified auctions reduce latency by allowing demand partners and mobile ad networks to participate in multiple auctions simultaneously. This is especially important for mobile devices where time spent waiting on an ad network is wasted because users don’t like to wait and will leave your site if they have to wait too long.
2. Increased impression shares – With complete access to all demand sources in an auction, publishers can reach maximum inventory shares and significantly increase their revenue potential.
3. Higher average CPMs and higher fill rates – You can set up rules based on bids or other relevant factors (like viewability) that ensure only those ads which meet certain criteria get served while others are blocked out completely!
4. Real-time Metrics: AdOps experts can optimize prices and sell ad inventory by analyzing bid request data in a unified auction environment without the need to rely on historical data.
5. Better Reporting Transparency with access to auction performance data, impressions, earnings per demand partner, bid CPM prices, winning CPM prices, etc.
6. Increased ad revenue with increased demand since all server & client-side demand sources are treated the same.

How to Set up In-App Header Bidding?

There are the steps you must take to build a solid in-app header bidding setup:

1. Set up a DMP (data management platform)
2. Build an existing mobile app already released in the app store or Google Play store
3. Setting up the main ad server and Prebid server
4. Integrating Prebid SDK & primary ad server SDK

Click here if you are facing issues setting up in-app header bidding.

The benefits of In-App Header Bidding for Publishers

Advertisers are more likely to bid higher when they have access to real-time data, which results in better ad delivery and a better user experience. When you combine that with the fact that more demand partners are bidding on your inventory, it means you’re going to get the best possible fill rates.

The benefits of In-App header bidding include:

1. Maximized revenue potential due to increased participation of buyers
2. Improved fill rates due to more exposure to tonnes of demand partners
3. Highest bids secured due to increased participation of buyers
4. Reduced latency since auctions run parallel compared to the waterfall method
5. Better User Experience with faster load times.
6. Improved transparency which leads to increased CPMs
7. More scope for remarketing cookie matches to acquire the highest paying CPM rates.
8. To maximize revenue, publishers should focus on both in-app and web header bidding. Publishers are no longer limited to one or the other.

Want help in setting up & tweaking your app monetization for long-term app revenue gains? Get in touch with our AdOps professionals today.

Aleesha Jacob

With over seven years at the forefront of programmatic advertising, Aleesha is a renowned Ad-Tech expert, blending innovative strategies with cutting-edge technology. Her insights have reshaped programmatic advertising, leading to groundbreaking campaigns and 10X ROI increases for publishers and global brands. She believes in setting new standards in dynamic ad targeting and optimization.