November 13, 2015
Flexible Ad Units
Miki Rapoport, Product Management OpenX
Larger ad units command higher CPMs, but they tend to have lower fill rates. Smaller ad units are more likely to sell out, but at a lower price. For publishers that tradeoff has long been a painful one because it requires sales teams to engage in guesswork, which often means leaving money on the table. But what if publishers could dynamically adjust supply to meet fluctuating demand?
With that question in mind, we created a unique solution called Flexible Ad Units. Publishers in the OpenX Ad Exchange can now implement Flexible Ad Units in order to accept multiple creative sizes per ad unit on a dynamic basis.
Rather than bidding on a single ad unit, Flexible Ad Units combines all available ad unit sizes into a single auction. The highest bid still wins, but the winning bid also determines the size of the ad unit, which adjusts dynamically to meet demand.
In the past, publishers would have to A/B test various ad unit sizes in order to optimize yield. Flexible Ad Units creates a real-time A B test. Instead of projecting demand and leaving money on the table, Flexible Ad Units means that publishers are always able to sell the size with the greatest market value.
A publisher can only benefit from implementing Flexible Ad Units, because at best, the publisher is already gauging demand with 100% accuracy. If that’s the case, the Flexible Ad Units solution will merely automate the publisher’s calculations and deliver the same yield. However, the more likely scenario is that the publisher isn’t gauging demand with 100% accuracy. So when a publisher chooses to implement Flexible Ad Units, they can do so knowing that they will almost certainly increase yield without risk.
By making supply dynamic, buyers also benefit in several ways.
When publishers have the ability to adjust their inventory dynamically to match demand, buyers gain access to ad formats traditionally considered “scarce” by industry standards – these formats include all rising star sizes (300×600 & 970×66/970×90/970×250).
In a private marketplace, dynamic supply benefits buyers because they can allocate their spend precisely to meet the needs of their campaign, as opposed to whatever inventory the seller has set aside for the PMP. Moreover, if the buyer is using programmatic tools in the PMP, both buyer and seller will automatically arrive at an optimal balance between higher CPM inventory and secondary sizes that have significantly lower fill rates.
How do Flexible Ad Units work?
Publishers can implement Flexible Ad Units without the hassle of adding code to the page or modifying their sales strategy. Flexible Ad Units work in desktop, mobile web and mobile app environments. Here’s how it works:
- The publisher chooses which creative sizes they want to support
- Advertisers enter a single auction in order to bid on multiple creative sizes
Ultimately, publishers win because they increase both competition and fill for all inventory.
Advertisers win because Flexible Ad Units gives them access to scarce inventory like rising stars.
Multiple publishers have helped us test Flexible Ad Units, and already they’ve seen large increases in yield.
Here’s what the team at Major League Gaming, which saw 30% lift in yield, had to say:
“We’ve been thrilled with the value we’ve seen from implementing flexible ad units with OpenX. Not only have we seen a significant increase in yield, but we’re also able to deliver more value to buyers, while maintaining a quality experience for our users.”