For years, the standard approach to programmatic monetization relied on a linear, sequential chain known as the waterfall. In this model, digital publishers were forced to prioritize demand partners based on historical averages rather than real-time value. This created a significant inefficiency where lower-priority partners, who might be willing to pay more for a specific user, never even had the opportunity to bid if a partner higher up the chain accepted a lower price. As the ad tech landscape matured, the industry demanded a more efficient mechanism to uncover the true market price of every single impression.
This need for efficiency led to the widespread adoption of the header bidding process, a programmatic technique that fundamentally restructured how inventory is sold. By allowing multiple exchanges, Supply-Side Platforms (SSPs), and ad networks to submit bids simultaneously, publishers effectively flattened the hierarchy. This real-time competition generates immediate bid density, ensuring that the inventory is sold to the highest bidder rather than just the first available buyer.
However, executing this complex auction immediately when a page loads presents significant technical challenges. It requires a sophisticated framework to collect bids, enforce timeouts, and pass the winning price parameters to the primary ad server without causing latency issues that could degrade the User Experience. This is where prebid comes into play. Let’s discover more!
What is programmatic advertising and header bidding
Before explaining more about prebid, it might be helpful to understand the landscape it “lives” in. Programmatic advertising is simply the automated buying and selling of digital ad space. You can think of it as a stock market for ads where software replaces manual Insertion Orders. Within this ecosystem, header bidding is the strategy that changed the game. It allows publishers to offer their ad inventory to multiple ad exchanges simultaneously before calling their primary ad server. Understanding these terms is crucial because they are the “what” and the “how”, while prebid is a tool used for the execution of this process.
What is prebid, and how does it work?
In short, for publishers looking to optimize their strategy, prebid is the go-to open-source toolkit. It connects you to multiple demand partners via header bidding. Instead of selling to one buyer at a time, you let them compete simultaneously, which generally helps to drive up the price of your ad slots, thus increasing your ad revenue (pricing increases are also driven by traffic quality, the volume of partners, and demand). In other words, with its wide library of efficient adapters, prebid helps publishers connect with many demand partners and invite bids for their available ad inventory.
The specific piece of code that powers this in a publisher’s browser is called Prebid.js, and it is the textbook definition of a wrapper. It earns this title because it effectively “wraps” or encapsulates the code for various demand sources into one single container. The reason this is so important is that Prebid.js acts as a central traffic controller; it holds all the different bidder adapters inside it so they can function together smoothly. Instead of the publisher having to manage messy individual connections, Prebid.js manages the entire header bidding solution by triggering bid requests for all partners at the exact same time and collecting responses, ensuring the auction is unified and organized.
Server side header bidding vs client side header bidding
Client-side header bidding is essentially the “do-it-yourself” approach for a web browser. In this header bidding solution, the most vital thing to understand is that the user’s browser does all the heavy lifting. When someone visits a webpage, their browser sends multiple bid requests in parallel.
Server-side header bidding, on the other hand, acts like an outsourcing service. Instead of the browser running around, it sends just one single call to a dedicated server in the cloud. This external server then handles the chaos, firing off the bid requests to all advertisers instantly and sending only the winning ad back to the browser.
If you want to find out more, we recommend our article explaining in detail the differences between client-side and server-side header bidding.
Parts of prebid
Prebid isn’t just one thing – it’s actually made up of a few main parts:
- Prebid server: which moves the “responsibility” off the browser and onto a server. By processing the auction in the cloud, pages load faster, and there’s less lag for the user;
- Prebid.js: is the big JavaScript library that runs right in the user’s browser. It handles the “client-side” stuff, giving publishers a simple way to set up auctions, manage partners, and grab bids;
- Prebid video: as the name implies, is built specifically for video ads. It supports both client and server-side setups to help you squeeze the most revenue out of your video content;
- Prebid mobile: is an SDK for app developers. It basically brings the power of header bidding into mobile apps, so you aren’t limited to just web ads.
Benefits of prebid
- Open and community-driven: because it’s open source, a massive community of developers is constantly improving it. You get a solution that is flexible enough to be custom-tailored to your needs, while also staying compliant with data privacy standards (including support for common IDs);
- True economic efficiency: think of this as the most logical way to sell ads. Instead of selling to the first buyer in line (the old waterfall method), prebid runs a simultaneous auction;
- One wrapper, many ad formats: whether you are running standard display banners, video, native ads, or monetizing a mobile app, prebid can handle it. It’s versatile enough to provide a unified architecture across all your different web properties and formats;
- Transparency and control: you get to see exactly who is bidding and how much they are offering. This removes the guesswork, allowing you to optimize your floor prices and strategy based on real data;
- Easier troubleshooting: when things go wrong (and they sometimes do in ad tech), prebid gives you a solid suite of tools for debugging and testing. This makes life much easier for your dev ops and ad ops teams when they need to figure out why a creative isn’t rendering or why a bidder is timing out.
Implementation of prebid
Instead of requiring the publisher to configure Prebid.js independently, which is technically challenging, optAd360 provides a ready-made, pre-configured solution – a wrapper. This means we implement the prebid code on your site, manage demand adapters (which connect various ad networks/SSPs), and optimize auctions.
What’s more, at optAd360, we use client-side header bidding as the foundation for high bid rates, but wrap it in technology that protects your page speed. For you, this process is “invisible”, as you receive a single script (One Tag Programmatic Solution), and our system automatically decides how to run the auction.
FAQ
- What is prebid?
Prebid is a set of open-source tools that powers header bidding. It acts as a “wrapper” on a website or app that allows a publisher to auction their ad space to multiple advertisers simultaneously (rather than one by one). - Is prebid free?
Yes, the software code is free. Because it is open-source, anyone can download and use it without paying a licensing fee. However, while the code is free, using it usually costs money in other ways, for instance, when you hire a developer to set it up. - How does optAd360 simplify the process?
It’s very simple, thanks to the plug-and-play function of our technology – optAd360 AI Engine. Instead of your developers spending weeks manually configuring Prebid.js and testing which bidders work best, you simply paste our tag into your website’s header. Behind the scenes, our technology automatically manages the header bidding auction, selects the best SSPs for your specific traffic, and even dynamically adjusts your ad layout to maximize viewability without ruining the User Experience. We also include advanced features like “Smart Refresh” (refreshing ads in the user’s view) and tools, such as Ad Mapper (creating new ad slots automatically), directly within that same tag. It basically turns a complex engineering project into a simple “copy-paste” task, letting you focus on content while we handle the monetization tech!
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