AdUnity announces a major double feature launch for its AUX (ad exchange) and SSP: Auction Intelligence and Dynamic Lift.
Auction Intelligence is a new integrated set of advanced auction tools for publishers.
Dynamic Lift is a totally new version of AdUnity’s dynamic bid floor technology.
Why Advanced Auction Control and Dynamic Bid Floors?
There has always been debate and disagreement about whether the Vickrey second-price auction model is a fair auction model for publishers (further reading on this debate can be found, here, here and here). In any case, the implication for many if not most Publishers is that second-price auctions create significant market inefficiencies. This is because in the real world the majority of auctions have either only a single bidder or if there is a second bidder the second bid is very, very low in comparison (sometimes even below bid-floor). At AdUnity we see this kind of market activity every day. However, it is not just us that see this, Ad Exchanger claims up to 70% differential between first and second bid. This point is illustrated below.
Since the winner of the auction only pays one cent more than the second highest bidder or bid floor then the inventory is grossly undervalued in a huge number of cases. The bid floor becomes the selling price and all the benefits of a market environment evaporate. Unfortunately, this is a very common problem.
The only way to improve the position of publishers and correct this market failure is to adjust the bid floor on an impression-by-impression basis. The goal is to match or get very close to real market value. This is shown below.
Our Dynamic Lift module considers both audience and market data (see definitions in a previous blog post here) to determine optimum bid floor for a given impression. In this way, we bring the clearing price closer to real market value.
However, as always in the programmatic media space, it is not so simple as to decide whether or not to automatically optimise bid floors. The question is also how are bid floors optimised? For this additional tools are needed to make auction strategy adjustments that work with wider sales strategy. This is why AdUnity’s Auction Intelligence feature is so important for revenue protection.
About Auction Intelligence
Auction Intelligence is an integrated set of auction management tools that work together to optimise revenue, eCPM and fill in different combinations depending on specific business goals and sales strategies. Auction Intelligence brings a new holistic and transparent approach to auction management. Auction strategy settings can now be configured individually or in combination and can be set to deliver different sales strategy goals.
AdUnity’s transparent approach is unlike many rival SSPs and Exchanges since we allow publishers to enable different features individually and choose specific strategy goals. This means auction strategy is always aligned with a publisher’s other sales channels and wider sales strategy. Ad operations or sales teams are now empowered to review, edit and implement complex changes with just a few clicks. The entire Auction Intelligence toolbox is available on AdUnity’s exchange (AUX) and it’s SSP.
“The reason why Auction Intelligence toolbox is important is because publishers are different and have different approaches to sales strategy. For example, a B2B financial services site will have a very different sales strategy to a celebrity gossip site. Up to now, the market has been offering one-size fits all when it comes to auction strategies. In the end, it is about maximising yield for different scenarios so it is important to consider different approaches.” says Rupert Graves, CEO of AdUnity.
Mihnea Bucur, CTO of AdUnity, describes the journey in the planning, development and delivery of the new feature set. “Auction Intelligence is something we have been working on for the last nine months. Initially, our thoughts were to make an evolutionary improvement to our existing systems with the latest real-time and AI technologies, but after speaking to customers we realised that we also needed a different philosophical and business approach. Our challenge was to combine options for different sales strategies while simultaneously optimising yield across all sales channels. We have created a much more flexible and responsive technology architecture that can also learn in real-time. We look at auction management as a large matrix of technical optimisation problems, with many variables and data points in play. For example, brand safety is a key issue for many publishers, and this must also be taken into account when it comes to optimising floor prices since brand safety policies may vary according to geo and time of day.”
About Dynamic Lift
Dynamic Lift is a totally new and re-engineered version of its AdUnity’s dynamic bid floor technology that massively improves floor price efficiency. Dynamic lift varies bid floor for each impression in real-time in order to maximise sale price. Dynamic Lift is available as part of the Auction Intelligence auction management tools. Dynamic Lift can be adjusted by publishers to suit their particular market conditions and to optimise for different types of sales targets and business goals. Production testing with existing customers AdUnity saw a 30% revenue uplift in many scenarios.
The Dynamic Lift technology takes into account bid quality and bid density for specific users as well as a comprehensive view of the bid landscape. Every impression has a bid floor set in real-time depending on current market conditions and historic demand for any given audience/inventory. The bid floor adjustment is in response to both the price level and intensity of current and historic demand as well as other factors. In keeping with the other parts of the Auction Intelligence toolbox, Dynamic Lift allows ad operations or sales teams to review, edit and implement complex changes with just a few clicks.
Iulian Andreescu, Director of Engineering explains how Dynamic Lift will improve inventory yield, “Dynamic Lift is a central part of the Auction Intelligence toolbox. We see many different bidding strategies from buyers, but the biggest problem for many sites is that too many impressions only have one bidder or one high-value bidder and given the rules of the Vickery Auction many publishers sell at below market rate. We expect Dynamic Lift to make a significant improvement to publishers’ revenues because it effectively adjusts the price floor to real market rates.”
ADUNITY is a publisher focused ad technology company based in the UK with offices in both London and Bucharest. We deliver trust, transparency and advanced technology in the programmatic ecosystem. AdUnity provides transparent trading platforms for publishers (no black boxes) and does not operate an arbitrage model; just a flat revenue share. We comply with the latest programmatic standards (OpenRTB 2.4) and format standards (HTML5, VAST 2.0, VPAID 2.0, MRAID 1.0). AdUnity works with the largest media and agency groups in Central and Eastern Europe and Turkey.