Publishers are getting more interested in knowing how the ad industry works. Since real-time bidding and header bidding are the two most popular methods to sell digital inventory, we will start by discussing them.

Do you (publisher) know how does the bidding start? How do advertisers know about inventory that just became available? And how can an advertiser know what kind of ads to display? The answer to all these questions is bid request.

So, What Is A Bid Request?

A bid request comprises certain lines of code containing the details required to sell inventory and display ads.

It’s a set of information sent by ad exchanges to the advertisers containing inventory details about the platform, number of impressions, and keys to user-data (IP, pixels, tags, cookies). Using this bid request, the advertisers place their bid for the inventory and then finally place their ad.

The process starts as soon as a visitor reaches on the website. A bid request is then generated informing about inventory available for impressions. As we know every user is unique and so does every bid request. Because bid request highly depends on the user’s demographics (geographic location, age, gender, visited websites, etc.).

Bid requests are used for real-time bidding, exchange bidding, and header bidding. To further understand bid request, you’d need to know about the bidding process first.

How Real-time Bidding Works?

As the name suggests, real-time bidding works in real time. Likewise, inventories are sold in real-time and hence advertisements are displayed in real time. Here’s the actual process:

It starts with a visitor launching a web page which is showing real-time ads. That’s when a bid request is created from where the supply side picks the bid request. A supply-side platform receives many bid requests every second and uses yield management platforms to manage them. These bid requests are coupled based on inventory type and environment.

Now, the bid request is sent to advertisers based on the user’s demographics. Example, advertisers interested to show their ads to a 20-30 aged female living in Portland who is also interested in physics will receive the bid request. This may sound very specific, but there are tons of advertisers who design their ad campaigns for such users to see their ads.

Once the bid request is received, the advertisers place their bids and send a bid response with their amount. The highest bidder gets to display the ad. And this entire process takes less than a second.

However, if the user refreshes the same webpage, a new bid request will be generated and the process will start all over again.

Why Should I (Publisher) Care?

Because the bidding world is not protected against frauds. Knowing the process and understanding how bids are created and responded can help publishers have an entire view of the process.

A report by AdExchanger stated, there have been numerous frauds where users’ personal information is sold to an organization without the users’ consent and publishers’ knowledge.

But how do they get the hold of user data in the first place? The Answer is bid request. A bid request contains the information related to inventory as well as the users’ demographics. Using this, anyone involved in the bidding chain can get access to details such as IP address, age, gender, and even browsing history.

Many debates are conducted discussing whether using visitors’ demographics to show them personalized ads is a good practice or not. Yes, it indeed helps with better revenue generation for publishers. At the cost of security doesn’t sound really good, though.

What Kind Of Information A Bid Request Has?

Conclusion

Bid request is an essential part of the advertisement environment. The exchange of information between publisher and advertiser is possible because of bid request. The programmatic dealing has many moving parts and bid requests keep this process moving.

Also, technology can’t be perfect, so neither can bid request. It has some flaws leading to some major ad frauds. However, efforts like ads.txt and ads.cert by IAB can help in reducing some of the frauds.

It’ll take some time for ad industry to make the dealing completely secure. Until then, let’s focus on the good things and try to apply best practices in our system.

FAQs

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