What is a programmatic bid request and how does it work?

Bid requests are meant to improve the advertising user experience (UX). It’s also meant to increase publishers’ advertising revenue. However, UX should always be the number one priority for website owners and brands alike.

Of course, if you’re running a website as a business and that business relies on ad revenue, then your top priority is to cater to the UX by ensuring that the ad experience — on top of everything else — is relevant, efficient, and effective. After all, if there’s one thing that can repel visitors from your site, it’s a terrible ad experience.

Ads can be disruptive if they load incorrectly within a Web page’s content or cause slow load times. They become even more disruptive when the wrong ads are delivered to the wrong users.

Unfortunately, ads aren’t something you can just skip out on. Brands and media companies depend on getting their ads out for brand awareness and website conversions. Plus, displaying ads is the best way to monetize a website when you’re not selling any products or services directly.

That’s where bid requests come into play.

What is a programmatic bid request?

When a user begins to load a Web page, the publisher’s technology provider — who monetizes their content — creates a bid request.

It can be created by a Prebid-based header bidding wrapper, a non-Prebid wrapper, or with custom ad tags provided by a managed Ad Ops vendor. The bid request tracks user-level data such as demographics, browsing history, geographical location, current Web page information, and more. This information is then shared with advertisers.

The bid request acts as a key between publishers and advertisers so both parties can buy and serve ads to relevant users. A collection of these requests become part of bidstream data.

A closer look at how bid requests work

Bid requests are simple enough to understand on a superficial level. Now let’s talk about how bid requests actually work during the bidding process:

  1. A user visits a publisher’s website.
  2. This triggers a bid request to be generated based on the user’s data points.
  3. Once the bid request is generated, it is sent to ad networks and exchanges to be shared with advertisers.
  4. If advertisers deem that there’s a match between their target audience and the user visiting a publisher’s page, they will return a bid response to the ad server.
  5. The ad server selects the winning bid and the creative is displayed on the publisher’s Web page to the specific user.

This process is repeated for however many ad slots exist on a given Web page and takes milliseconds to complete. In most cases, it will provide a full page of contextually relevant ads to the visitors on the page.

What information is included in a bid request?

Once a bid request is generated, it’s full of valuable user information, the information regarding the ad units available on a Web page, and the general content on the Web page.

More specifically, bid requests contain the following information:

  • The bid ID
  • The user’s device
  • IP address
  • The website in question
  • Cookies, tags, or pixels

Let’s jump into the details.

The Bid ID

The bid ID is essentially a unique identification number that gets assigned to each bid request. This number is how the bid requests are identified by advertisers.

The user’s device

The ‘user’s device’ refers to whichever device a person is using when they browse a particular website. This device could be their mobile phone, desktop computer, laptop, or any other smart device that can be used to consume content.

IP (internet protocol) address

Every internet-connected device has its own unique public address that can be identified on the internet or through a local network. It will typically look like this, 159.36.129.195. This address includes information like a user’s ISP (internet service provider), city, and country.

The website in question

The website data that’s collected for bid requests will always include information regarding page context, the website’s content type or niche, the site’s publisher ID, domain name, and anything else that could be relevant to the advertiser’s needs.

Cookies, tags, or pixels

These technologies are coded into a website and are used to compile data about a user’s Web activity and details about the user themself. This would include the user’s location, age, gender, browsing history, and even things such as their personal preferences, hobbies, family size, and income.

Advertisers use this valuable information to serve the most personalized ads possible. It not only enhances the user experience but creates a better chance for the user to engage with them. The best-case scenario would ultimately be the user making a purchase decision after viewing one of these ads.

What about user privacy?

While bid requests contain typical yet valuable information that’s used for audience targeting and retargeting, not all browsers get along with them. Certain browsers are designed to prevent a user’s personal information from being revealed, which means the information collected for bid requests will vary significantly.

This is also something that can cause the ads served to end up completely irrelevant to the user being targeted.

One example of this is Safari’s Intelligent Tracking Prevention (ITP) initiative. The ITP is used to purge users’ browsers of all third-party (data tracking) cookies. The user can also set their Web preferences to specifically opt out of personalized ads. When this happens, the bid request being generated will only contain the context of the Web page to deliver ads that are contextually relevant so not all is lost.

Bid requests have become an essential process in programmatic advertising as they allow the ad tech players to exchange and utilize valuable information geared toward audience targeting and retargeting. It also allows both parties to increase their bottom lines fairly and efficiently, creating the best possible scenario.

Of course, a user’s privacy is important and should always be respected — especially when it comes to the user experience as a whole. That’s why as publishers, you should strive to ensure that the data included within your bid requests are not shared with unidentified vendors resulting in ad fraud. Bid requests should only be shared through recognized ad exchanges and SSPs.

In summary

Bid requests allow advertisers to accurately bid on a relevant publisher’s inventory.

It holds key information regarding the user on the publisher’s website. Advertisers choose to bid on the latter’s inventory if there’s an audience match. This is how publishers are able to serve relevant ads to their end users.

A component of that key information includes data gathered through cookies. As Google phases out third-party cookies, publishers and advertisers are justifiably worried about losing their ability to target users reliably. Aside from the multitude of identity solutions available to potentially replace cookies, advertisers will still be able to bid contextually based on the publisher’s web content.

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