A guide to the evolution of modern programmatic video

Programmatic video is penetrating rapidly into the mainstream advertising landscape. Its growth is largely attributed to developments in programmatic transaction technology, progress in mobile video access and the expansion of mobile video viewership.

Already programmatic ad spend is exceeding projections and anticipated to grow at double-digit rates for the next several years. In the US alone, programmatic video spend is anticipated to reach $10.65 Billion by 2018 (eMarketer).

One of the effects of programmatic video growth is the proliferation of video bidding technologies. To date, many programmatic stacks rely on display processes without video-specific delivery and playback functionality.

Here at Cedato we aim to make sense of video header bidding through an infographic charting the main options.

Programmatic RTB bidding for video

Built originally for display, RTB (Real Time Bidding) for video reflects the process in display. In the video environment, RTB aims to secure the best price for video inventory through an open auction or auto-guaranteed option. Here each impression is sent to a single SSP (Supply Side Platform) server and auctioned in real time to reach the highest bidder amongst participating DSPs (Demand Side Platforms).

Although loading times are relatively fast, the exposure to demand, via just one SSP source, is limited. The lack of a video-specific bidding technology also increases the risk of ad delivery failure. So the winning bid may not actually materialize into a video ad that is actually played, leading to lower fill rates. Yield optimization is compromised by a process that accounts for price only.

Client-side Video Header Bidding

Video header bidding on the Client side makes it possible for publishers to reach out to multiple demand partners simultaneously. Once the process is set in motion, the demand source offering the highest price beyond a predefined threshold wins the bid. Heralded as a replacement to tag-based waterfall processes, Client-side header bidding surged in popularity because it increased exposure to demand.

It also served to compensate for ad delivery failures and to improve fill rates by providing extra attempts to bid on each impression. In practice, Client-side header bidding merely moves the bidding process to the user’s device, which drains its resources.

Due to video’s inherent file and format complexities, the Client-side header bidding process leads to high latency and compromised viewing experience.

Server-side Video Header Bidding

Server-side video header bidding makes it possible for auctions to function outside of publishers’ sites. Rather than facilitate multiple calls to-and-from the web page, the auction is held once a call is sent to the server side.

Video header bidding on the Server side emerged in response to Client-side shortcomings, in particular latency issues. The amount of implementation work also needed to place JavaScript code in the header did not work in its favor.

Server-side header bidding creates more demand and unlike browser-side header bidding, server-side header bidding performance in theory isn’t tied to as many multiple integration points, enabling better scaling.

Nevertheless the missing part of the puzzle is the lack of video-specific delivery and playback technology and the expertise needed to support ongoing operations. What’s more, the departure from the client side increases the risk of ad delivery failure due to the lack of visibility of VPAID errors.

Hybrid Video Header Bidding

Hybrid Client-to-Server video header bidding integrations capture the best of both worlds:  On the server side it performs the ‘heavy lifting’ with a predictive optimization process, taking into account multiple data points beyond price. On the client side hybrid video header bidding validates “last mile” video ad delivery by detecting potential VAST / VPAID errors and solving them during the bidding process.

If triggered on the client browser side alone, header bidding in video is prone to creating repetitive ad requests that once again slow loading times. Concurrently operating on both sides, Hybrid video header bidding addresses all the main shortcomings of one sided processes and also clears the way for successful optimization.

Operating in real time across all video formats hybrid header bidding overcomes video file size and compatibility issues to significantly lift demand, produce far higher fill rates, minimize latency, and reduce the risk of delivery and playback errors.