Archive for Working On It

Floors In RTB: Are hard and soft reserve prices known to the DSP?

I assumed that before bidding, DSPs could not be sure whether an SSP applies floor price rules to an auction. Now, I saw some remarks in the academic literature implying that buyers know about the existence or even the exact quantity of floor prices.

In practice, do SSPs communicate their floors?

This question was asked on quora, below is my answer.

Floor Prices in an AuctionThe answer is: sometimes. Exchanges sometimes express floor or bid guidance in the bid request. This is not required for the market to operate; so many exchanges do not provide any guidance. Floors are almost always in play. In most cases they are dependent on a wide variety of variables including: the site, browser, device, day of week, time of day, audience data, user’s language, and geographic location of the user.

Auction Mechanics

Floor prices, from an academic standpoint, are there to protect the base value the publisher has placed on the inventory. Bids falling below the floor, or reserve, are usually rejected by the exchange. Losing bid information might be recorded to give the publisher insight on the value advertisers are placing on the inventory and accompanying traffic.

These academics don’t necessarily apply to soft floors. The soft floor is there to capture value from the advertiser’s bid. Any winning bid falling in the range between the soft and hard floor will, in essence, be participating in a first price auction, rather than a Vickrey, or second price auction.

Price Floor Discovery

DSPs can, and have built systems to estimate the reserve prices, or at least the going rate, when guidance is not provided. Many of these systems in turn give guidance to advertisers when they are planning their media buy.

If you are friendly with a DSP, you might consider asking them which SSPs and exchanges are providing bid guidance.

For more on this topic: Rubicon Project published an excellent white paper on floors in the RTB auction. [requires registration]









Disrupting the Bid in the RTB Auction

RTB Bid Keys

Your eyeballs are on the block, but they don’t always go to the highest bidder.

“In RTB, will the bid with the highest CPM always win? If not, what are the other factors?”

This question was asked on quora, below is my answer.

In a pure auction, the highest bid should always win. In many cases an RTB auction ends with this result, but not always. There are two or three things that will adjust the auction mechanics to give a lower bidder the impression. Most of the time a modified auction is at the behest of the publisher.

Advertiser Filtering

Advertiser filtering is the first thing that can get in the way of the highest bidder. This feature is typically marketed as “brand protection.” It’s a way that publishers keep undesirable ads or advertisers off of their inventory. Competing brands and low quality ads are the most obvious targets of ad filtering.

Sometimes, however, a publisher will strike a direct buy from an advertiser. In order to protect that buy the publisher might block the advertiser’s other access channels. This means keeping the advertiser from buying additional inventory in the open market via RTB. Read more

Why I Built Scrypter

Scrypter LogoThe year was 2008. Social media was just ramping up. Twitter was an infant and people were still wondering why Google bought YouTube. MySpace was starting to wither under News Corp and Facebook was on the rise to supplant it.

I was in the email business back then, but already looking for something else. Our email platform allowed us to schedule email deployments down to the minute. On a Monday we could tee up our correspondence to our subscribers for the week. Conceptually, we could have just sat back and just watched the mail go out. (That never happened, of course; we managed it very closely.)

Thoughts of the great American novel were bouncing around in my head as well. I had a story that I wanted to get out to the public, and I began to wonder if the web, the Internet, the cloud, the whatever-we-call-it-these-days could be used to deliver it.

What if I could write my story – even create videos for parts of it – and deploy it on a schedule? What if I could use social media accounts as characters in my story? I could let the characters tell the story via posts, and if I could schedule the posts, they could tell the story in real-time. Read more

Buying the (Blueberry) Farm

One of the more interesting decisions I’ve made was buying into the blueberry farm. It came about “innocently” enough. My brother and father conspired to pitch an investment opportunity in the form of blueberries.

From Email to Farm

Blueberry FarmersIt was 2006 and I was reaping the benefits of the email business I started with a partner back in 2002. We, of course, starved and scrambled to find work for the first two years, but then something hit. One of our clients, a good friend from before the bubble burst, got us pointed at an email platform. We built it, and then managed to find another client who needed one. So we licensed it, and so began our email business.

By 2006 the business was humming along. We had several clients and were expanding into other opportunities. There was a substantial surplus of cash that we opted to take out of the business. This allowed me to pursue other ventures, like farming. Internet technology and farming go hand in hand, right? Read more

How is an RTB winner chosen in the case of identical bids?

When multiple advertisers are bidding for a certain (impression) and more than 1 enter the same bid amount, (each) being the highest, how does the RTB (auction) determine which ad should be displayed.
This question was asked on quora, below is my answer.

Identical BidsIdentical bids are not unheard of, but they are rare.  Bid prices are presented as a CPM value with up to five decimal places.  That means that the actual impression can bid upon with precision down to eight decimal places.  So in that rare event, when there are two or more matching top bids, the winner is chosen at random.  This is only the tip of the iceberg, though.

Features are being added to RTB systems that allow for preferential treatment of preferred DSPs, agencies, trading desks and even advertisers.   Deals that are struck between site owners and buyers are being executed through the RTB infrastructure.  Those deals can supersede standard auction mechanics, resulting in a winning ad from a preferred partner in the presence of matching (or higher) bids from other parties.

As time goes on and the RTB system is exploited for more and more features, having equal footing in an auction will be more rare, relatively speaking.  There will always be general auctions where no bids are given special consideration.  We are, however, entering an era where premium inventory is available to buyers through RTB.  With that inventory comes a more carefully crafted environment to buy and sell.

SEO: Simple Search Engine Optimization for Small Business

Search engine optimization should be used in conjunction with online advertising to drive more users to your site.  It can, in some cases, allow a small business to reduce the month-to-month costs of advertising by bringing “organic” (unpaid) traffic to their web site.

SEO for acupuncture in ChicagoSearch engine optimization (SEO) consists, at the simplest level, of three things: knowing your target keywords, optimizing your content around those keywords and building inbound links from relevant external pages.  That doesn’t sound so simple, does it.  I’ll break down these three points and expose my experience optimizing my wife’s site for her acupuncture practice in Chicago. Read more

Small business advertising

Rather than Small Business Advertising, I was going to title this post, “Eating your own dog food,” but I decided that a more descriptive title would get the benefit of SEO.  I recently took on the task of advertising for my wife’s small business, here’s our story.

Small Business Advertising for Leslie Smith MD

Leslie Smith MD

My wife’s acupuncture practice recently moved into a larger space; her patient capacity almost doubled overnight from one to two treatment rooms.  I say “almost” because she’s still just one practitioner.  With acupuncture, once the patient has been needled, they simply rest comfortably in pin-cushion mode.  The practitioner doesn’t need to be in the room.  That’s where my wife takes the opportunity to start treatment on a patient in room number two.

I took it upon myself to do some online advertising for her practice to fill up that second room as frequently as possible.  Now, my wife is not your typical acupuncturist.  She’s an herbalist, a holistic medicine practitioner and, most uniquely, an MD.  One would think that her résumé would do the marketing for her.  That’s not the case, obviously.  We have to let people know just how fabulous she is.  So, here’s the long story of how I used my background in advertising, my wits in video production and my fabulous wife’s personae to kick off her marketing push for the new office. Read more

One bid per DSP per impression – why?

Why historically (and currently) only one single bid was allowed for each DSP per impression? Why hide demand from the exchange and create opportunities for the DSPs to arbitrage? – I know this is changing now with the possibility of multiple bids per DSP (openRTB v2) but why ad exchanges let this happen at the beginning?
This question was asked on quora, below is my answer.

One bid per impression, why?Short Answer

A multiple bid response was discussed at the very first OpenRTB meeting.  It was not seen as a favorable feature by the demand side, at first.  They preferred submitting one bid.  Supply side partners were not in a position to force the issue, nor had the necessary research been done to support the idea.

Early Days

From the supply side’s perspective, as with many transaction systems, early efforts in RTB were focused on connecting the pipes.  RTB represented a new source of demand and the pressure was applied to getting plugged in to as many DSPs as possible. Read more