What Is Bid Rate?

How Does Bid Rate Work?

You can calculate ad bid rate by dividing the number of successful bid responses by the total number of bid requests. You then multiply this number by 100. 

For example, if there are 100,000 bid requests and 10,000 bid responses, the calculation is as follows:

Divide 10,000 by 100,000 and multiply this number by 100 to give you 10 percent. The bid rate would therefore be 10 percent.

Why Is Bid Rate Important?

Monitoring ad bid rate is important for both publishers and advertisers (bidders) for multiple reasons.

This metric helps publishers analyze why interested buyers might be bidding low, for example. A low bid rate could be the result of problems with the quality of available users and ad placements on supply side or targeting capabilities and advertiser diversity on the demand side. It could also mean that the mix of demand partners participating in the auction needs to be optimized.

High bid rates show a publisher that there is strong demand from advertisers and that auction participation is at a healthy level. This is a strong indication of how good a publisher’s ad inventory is. 

A good bid rate depends on the vertical of the app publisher and ad formats, but it is helpful to find the industry benchmark and compare personal historical data against this benchmark. Publishers might want to reach out to relevant partners performing the auction – whether it’s the mediation platform, supply-side platform, or ad exchange – to discover the relevant benchmarks.

How Do You Increase Your Bid Rate?

First things first, a low bid rate doesn’t mean that there is an issue with performance. Low bid rates can also be connected with bidder behavior, in that an advertiser has a specific policy that only allows them to bid on users from certain geos or app verticals (for example).  

There are nevertheless certain initiatives that publishers can take to increase their bid rate if they are worried about low performance. These include

• increasing brand safety
• improving the quality of ad inventory – or making it more relevant to advertisers who are specific with what they bid on
• integrating more quality demand partners
• checking for integration-related or technical issues

Conclusion

Bid rate is a crucial metric to monitor in the field of programmatic advertising. 

It helps publishers keep track of whether their current mix of demand partners is healthy or if the auction setup was successful – if it’s not, they can react quickly with the tactics mentioned above to improve performance.

Following relevant bid rate benchmarks for comparable ad formats and app verticals can help publishers gauge whether they should look into initiatives to optimize their performance.