Header bidding grew from publishers’ desire to break the stranglehold Google has on programmatic advertising. Now, Google rival Amazon has established a leading position with the supposed successor to header bidding, server-side bidding.
Amazon’s Transparent Ad Marketplace is the most popular server-to-server wrapper from the ad business, based on a study that ServerBid published on Oct. 4. Publishers are embracing this product because it brings in unique demand, is simple to integrate, matches consumers across different platforms and provides competition to Google, which wields a lot of control over publishers and their tech piles. While a lot of advertisement tech plumbing is interchangeable, Amazon has something new to bring to the party: proprietary commerce and behavioral data.
Since Amazon’s ad marketplace has unique need, its wrapper is an attractive choice for publishers attempting to boost their programmatic CPMs, said Erik Requidan, vp of sales and programmatic plan at Intermarkets.
Another advantage of Amazon’s wrapper is that it is easy for publishers to set up and make adjustments to, stated Emry Downinghall, vp of advertising in Chegg. For example, the wrapper enables publishers easily add or drop supply-side programs . It also makes it easy for publishers to shift bidders between on-page and server-side.
A drawback of server-to-server relations is that it is tougher for the SSPs and demand-side platforms to match their user IDs. With on-page header bidding, every SSP has access to the user’s browser, which means they collect and use their own matching data to sync with the DSP’s matching data.
However, with server-to-server wrappers — where one vendor aggregates the bids from each of the other sellers in a cloud-based merchandise — only the vendor collecting the bids has access to the user’s browser, which means the other sellers have to sync their information to the aggregator’s data. This additional step can reduce match rates, and it’s one reason why publishers are hesitant to adopt server-side bidding.
Unlike other tech vendors that need to make inferences from third-party data so as to construct a huge user database, Amazon continually obtains data straight from countless people who use its various products. Because Amazon gathers plenty of information on a large pool of users, it can avoid one of the pitfalls of server-side bidding by matching user information across the various vendors in its wrapper, said Chip Schenck, vp of information and programmatic in Meredith Corporation.
The popularity of Amazon’s wrapper is just the most recent example of the company sinking its hooks into the advertising industry. Amazon is also growing its sales staff , opening up self-serviceprogrammatic ad goods, courting video publishers, getting frequently mentioned during quarterly earnings calls and hiring 2,000 people to work in its new office in nyc. Amazon declined an interview request for this story.
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Given that the increase of header bidding was motivated by publishers’ frustrations about how Google’s ad server preferred its own exchange, it isn’t surprising that some publishers wish to hedge against the search giant’s dominance.
One reason why publishers are adopting Amazon’s server-side wrapper is because they view it as a counterweight to Google, said Purch CTO John Potter.
“It’s a fairly simple concern of everyone from publishers to SSPs,” he said. “Nobody wants Google to have more power in advertising.”
But if there is anyone that could overtake Amazon in server-side bidding, it’s Google. Google’s server-side item, which it calls exchange bidding, is still in pilot, but the amount of publishers using it has risen from 100 to 185 since May, according to a Google spokesperson. Google’s exchange bidding will become available in early 2018 to all publishers that use Google’s ad server DoubleClick for Publishers, the spokesperson said.
It is worth noting that server-to-server bidding is still in its infancy. Amazon was an early adopter of this technology, but its own wrapper isn’t even a year old.
Schenck said Amazon’s high adoption rate early on”gives them a little bit of a head start, but it does not determine who wins the server-to-server war.”