Why the Financial Times and BBC are header-bidding holdouts
Using header bidding to goose programmatic ad yields has become popular among publishers, with some reports estimating roughly half of media outlets have adopted the method in the U.K. and U.S.
But there are some notable header-bidding holdouts. Some are still weighing whether the benefits justify the investment, given that getting header bidding up and running is quite a complex process. Others say that the page-latency issues header bidding can cause don’t make it worth the tradeoff. Several — including the Guardian — have been holding out for a server-to-server version, which is being touted as the next evolution of header bidding, minus the latency issues and infrastructure costs.
The Financial Times isn’t a fan. Although the publisher has 843,000 print and digital subscriptions, making 60 percent of its revenue from paid-for content, digital advertising is still an important part of its revenue mix. It just has a markedly different approach to programmatic trading than other publishers. For starters, it is less dazzled by short-term revenue bumps, preferring to scrutinize everything against operational overheads.
“Programmatic systems have a resource overhead to manage price and block rules,” said Anthony Hitchings, director of ad operations at the Financial Times. “Maintaining multiple supply-side platforms for header bidding requires maintaining rules in multiple systems with increased overheads. There is further complexity in terms of troubleshooting why bids may not be winning.”
Although header bidding is executed automatically, to do it well requires a hefty amount of people power. In fact, some publishers, like MailOnline, have as many as six data analysts monitoring bid windows. “Publishers need to be aware of not just the revenue uplift from header bidding but the overall impact on margins,” said Hitchings. “Beware increased revenue at the cost of decreased profit.”
Ultimately, the core reason the FT is steering clear of header bidding is simple: page latency. “Our research shows that page latency has a direct impact on user engagement,” added Hitchings.
But it’s not just paywall publishers that aren’t seduced by the revenue-generating potential of header bidding. Other media owners, with large volumes of digital inventory, are also skirting the tech. Among them is BBC Worldwide, the commercial arm of the BBC.
David Goddard, global head of programmatic trading for BBC Advertising, which sits within BBC Worldwide, said that in its current form, header bidding offers “no value” to its operational effectiveness on a global scale. Overseas, the BBC claims 145 million global monthly visitors, so has a large volume of impressions. But for the media owner, the allure of what potential yield bumps header bidding can provide isn’t enough to offset the annoying side effects.
“We do not believe that the use of multiple tags in the page’s header adds any value to the user experience for our global audience,” added Goddard.
Still, the BBC and Financial Times are perhaps unlikely header-bidding candidates anyway. In the FT’s case, it can lean hard on its subscription revenues rather than scrabble around with other publishers for digital ad spend. The Economist, which also has a hybrid subscriptions-advertising business model, also hasn’t yet used header bidding. Although it is currently evaluating whether it’s something to pursue once it assesses how difficult it is to implement. “We’ll have to wait and see,” said Jamie Credland, svp of strategy and marketing at The Economist.
But others are already turning to the next iteration of header bidding, referred to as server-to-server solutions, which put less pressure on the publisher’s own browser and, therefore, theoretically wipe out the lag in page-load time. They also supposedly provide a more effective way to manage timeouts so that all buyers who want to, actually get to bid. This is what the Guardian is holding out for.
“We believe [header bidding] can offer a great opportunity to maximize programmatic inventory, but this should not be at the risk of user-experience or publisher control and transparency,” said Danny Spears, programmatic director at the Guardian. “To this end, we are focusing on server-side header bidding.”
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