Blog Post Cover - Open Bidding

The Ultimate Guide To Google Open Bidding


Google Open Bidding enables publishers to invite demand partners to a unified, server-to-server auction to bid for impressions. Previously known as Exchange Bidding in Dynamic Allocation (EBDA), Open Bidding operates in Ad Manager and offers reporting, trafficking, and billing. This guide explores how Open Bidding works, its benefits, and how it differs from header bidding.

What Is Google Open Bidding?

Open Bidding is a server-side, unified auction accessed through Google’s Ad Manager (GAM). It allows publishers to invite yield partners (demand partners) such as ad exchanges and ad networks to compete for ad inventory in real-time.

Google created Open Bidding to provide an alternative to header bidding. The aim was to offer a way to integrate non-Google demand partners and reduce page latency.

While header bidding runs on a user’s browser, the Open Bidding auction runs on an ad server. This makes it easier for the user’s device to load the ad setup. As a result, the page loads faster, leading to good Core Web Vitals, a positive user experience. However, Open Bidding also delivers lower ad revenue compared to header bidding as cookie matching on this platform is not as effective. See our Client-Side vs Server-Side Header Bidding guide for more details.

Since Open Bidding enables multiple yield partners to compete with Google Ad Exchange, publishers should see a higher ad fill rate and eCPMs when they adopt the solution.

Which Yield Partners Work With Open Bidding?

Google Open Bidding partners are ad exchanges and any ad network that has a contract with Google to participate as an open bidder. Publishers that want to invite a yield partner to the bidding process need to have a contractual relationship. Google does not facilitate the contractual agreement between publishers and partners. It merely provides a platform for publishers to host an auction on GAM.

By enabling Index in Google Ad Manager and Google Admob, publishers can access Index exchange omnichannel demand.

How Does Open Bidding Work?

Ad Manager facilitates Open Bidding requests between publishers and demand partners. Publishers need to have a Google Ad Exchange (AdX) account linked to GAM. This can be done through a Google AdX partner. Once a request is accepted by a demand partner, Google Ad Manager allocates the demand partners into yield groups that compete against each other.

How does open bidding work

Trigger

The process begins with an ad request trigger sent when a user visits a page. That information passes to Ad Manager via Google Publisher Tag and Google Mobile Ads SDK. Some of the details sent to GAM include the ad unit size and user demographics. GAM translates the data and creates bid requests which are then sent out to the demand partners.

Determining The Best Yield

GAM hosts a unified auction to determine the best yield. Ad Manager simultaneously performs several tasks to achieve that objective.

  1. Ad Manager selects the most relevant line item to compete in the unified auction. A line item is the instructions for how the ad creative will be served on the website including which users and ad units it will target.
  2. GAM sends a bid request to targeted yield partners.
  3. The targeted partners participate in an auction. The highest bid returns to GAM as the winner.

The unified auction consists of the yield partner bids, an Ad Exchange bid, and other direct line items via dynamic allocation (a way to insert all non-guaranteed demand—Open Auction, Open Bidding, and remnant line items).

Winning Bid Sent To Publisher

GAM selects the winning bid after a unified auction and dynamic allocation. The server returns the ad creatives and assets to the publisher to display.

Winning Bid (1)

Setting Up Google Open Bidding

Open Bidding is limited to Google Ad Manager 360 users. This prevents many publishers from accessing this effective platform. Publishers can access Google Open Bidding by contacting Snigel, a Multiple Customer Management (MCM) partner. MCM can be used to facilitate Open Bidding and Programmatic Deals or Direct deals.

Initiating programmatic deals:

  • A publisher syncs its data management platform (DMP) to the advertiser’s DMP
  • They exchange information to identify the publisher’s audience
  • Advertisers may request additional demand sources from publishers
  • Buyers can preview placements and determine the ones to purchase
  • Either party can initiate a proposal for a fixed number of impressions for a fixed price

The Pros And Cons Of Google Open Bidding

Open BiddingHeader BiddingAdSense
Auction hostGoogle serverUser’s browserGoogle server
Technical knowledgeBasic understanding of GAMHighly technicalBasic understanding of websites
Payment managementGooglePer each SSP or ad exchangeGoogle
Payment termsVariableVariableNet 30
Cookie matching rateLowHighLow
Ad revenueMediumHighLow
TransparencyLowHighLow

As you can see from the table above, there are various pros and cons to consider when switching to Google's Open Bidding. While publishers might want the higher revenue from header bidding, page load speed and good Core Web Vitals are now part of Google’s search algorithm. This means that fast websites will continue to gain more traffic than slower rivals. As a result, it is critical to balance revenue and speed.

How Do You Get The Best Of Open Bidding And Header Bidding?

By using a mixture of server-side and client-side header bidding, publishers can get the best of Open Bidding and header bidding. Snigel’s header bidding solution (AdEngine), dynamically selects 6-8 of the best performing SSPs for the client side auction based on past data. We then add a long list of over 50 SSPs to the client side auction which incorporates Google’s Open Bidding and Amazon’s Transparent Ad Marketplace (TAM). As a result, our publishers get:

  • the most competitive SSPs bidding client-side with high CPMs
  • faster page load speed because the client-side auction is lightweight (only 6-8 bidders)

Since the page loads faster, our partners have consistently achieved Core Web Vitals of around 100/100. If you’re interested in testing this get in touch with our ad ops experts for more details.

open bidding CWV

What Is The Difference Between Google Open Bidding And AdSense?

With AdSense, advertisers bid for ad space based on the website visitor’s profile. An Ad Manager invites demand partners to participate in Open Bidding to get a higher yield. Any publisher can use AdSense, but only Google Ad Manager 360 users can access Open Bidding. Higher revenue can be achieved for tier 1 Geos with Open Bidding. AdSense generates higher revenue in tier 3 Geos.

Open Bidding Benefits Compared To AdSense

  • Unified auction
  • Higher eCPMs
  • More revenue

Unified auctions involve multiple exchanges, Supply-Side Platforms, and ad networks. This lets more ad tech partners bid on a publisher’s inventory. As a result, publishers get more competitive auctions, higher eCPMs and more revenue.

What Is The Difference Between Google Open Bidding And Header Bidding?

Google created Open Bidding to provide an alternative to header bidding that improves page load speed. However, Open Bidding demand partners (on the server side) cannot access the same cookie information as header bidding demand partners (on the client side). As a result, advertisers bid less with Open Bidding because their targeting is not as precise as with header bidding.

Open Bidding Benefits Compared To Header Bidding

  • Reduced page latency
  • Simplified reporting

Users experience reduced page loading latency because the ad auction runs on a server. To ensure efficiency, an ad request will timeout in an auction if it takes longer than 160 milliseconds.

Publishers can easily identify revenue-generating channels due to simplified and detailed reporting. The reporting provides transparency about the demand partner relationships.

Technical Skills

Users with limited technical skills will prefer Open Bidding. Publishers using header bidding need advanced technical expertise in front-end coding such as HTML and JavaScript or a header bidding company like Snigel. Header bidding requires adding new JavaScript code to the header bidding wrapper for every additional demand partner. Open Bidding simplifies these changes for users in Ad Manager.

Page Latency

Header bidding uses a client-side solution to run auctions on the user’s browser. This has resulted in latency issues. Open Bidding reduces latency issues by running server-side unified auctions.

Payments

Google manages the billing and reporting and pays NET 30. Publishers manage header bidder payments, making it tedious and prone to mistakes. Certain demand partners pay only NET 45 or NET 60. Snigel is one of the few header bidding ad tech companies that manages this process for publishers and pays NET 30.

Cookie Matching

Header bidding is a better solution for increasing eCPM. It uses cookie matching to achieve a high match rate. While Open Bidding can map users across platforms, it doesn’t have access to the same level of rich cookie data as header bidding. As a result, publishers should expect lower eCPMs when switching from header bidding to Open Bidding.

Transparency

Publishers have greater transparency with header bidding. They can see incoming bids and bid prices. Open Bidding shows which demand partners are contributing to the publisher’s revenue but it does not give a detailed breakdown of the auction. This means publishers aren’t able to see exactly how the auction works and how the winning bids are selected. As a result, some publishers prefer header bidding where they can verify that the top bids are winning in a fair and demand-agnostic auction.

Does Open Bidding Work With Header Bidding?

Combining Open Bidding and header bidding auctions is possible. The client-side and server-side auctions run independently. GAM returns the highest bid received from both auctions. The header bidding auction’s winning bid is sent as a price priority line item. GAM selects the highest bid from Open Bidding and compares it to the header bidding auction.

After selecting the highest-paying buyer, GAM delivers the ad creatives to the user. Configuring and monitoring this setup is complex since the two auctions run independently, and the final step is the highest bid selection.

Both methods are a significant improvement to the older waterfall method of ad serving. Their auction efficiency and performance enable publishers to optimize earnings in the simplest manner.

For more information or to get started with Open bidding, header bidding, or a combination of both, contact our ad ops experts.

About the Author

Ira is Snigel's Online Marketing Executive. She supports our team and publishers by creating awesome guides on the latest adtech trends. Ira has studied software development, communications, and media.

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