- 20 Jan
- Eric Hochberger
100% Fill Rate Sucks. This is Why.
At Mediavine, our advertising fill rates generally fluctuate anywhere from 70-99% depending on the time of the year, but never reaching that elusive 100%.
And you know what? That makes us damn happy.
Why? Because 100% fill sucks. 100% fill is the reason your blog likely has crappy ads and isn’t performing as well as you want. Let us explain:
In the world of programmatic advertising, fill rate is generally inversely correlated with CPMs. Why? Because fill rate all comes down to floors.
Let’s back up for a moment and talk about what fill rate is:
When you set a floor in programmatic advertising, you’re essentially setting the absolute bottom price you’re willing to take for your ad unit(s). If you set that floor at $1.00 CPM, for example, the lowest bid you accept will be $1.00.
All auctions start at that price and any bids below that are thrown out. If it’s a second price auction and someone was willing to pay that $1.00, their bid will be raised to that amount.
Unfortunately, not all advertisers are willing to pay $1.00 CPM for your ad inventory, no matter how awesome your site is. So you’re going to have a lot of ads that “don’t fill.”
The takeaway is that the higher you raise that floor, the lower your fill rate, but the higher your CPMs will be. Choosing a floor is all about balance, and Mediavine is constantly running A/B tests to determine the best CPM. (See our guide to CPMs and eCPMs for the basics on these ad metrics).
Your target is to find the best eCPM, or your CPM times fill rate.
So how do you get 100% fill rate? Well, you’d have to essentially run an auction with no floor and give away many of your impressions at a $0.01 CPM.
Couldn’t you just run a 100% fill partner or a pass-back after your premium, higher floor auctions, you might be wondering? Absolutely, but in the process, you will trash the value of premium auctions.
Let’s say you’re an advertiser attempting to get on a domain, and you have two places you buy that impression — in this example, one at a premium at Google AdExchange starting at $1.00, and the other heavily discounted at AOL for $0.01. Which one are you going to bid on? Over time, advertisers are attempting to learn where to get inventory and where they can win for the cheapest.
In addition to devaluing your inventory, we’ve also found that most spammers tend to bid in the much lower CPM range. If you want to ditch the gross belly fat and malware ads that are sneaking in, raising your floor should definitely be part of your strategy.
Okay, so what do you do with the missing 1-30% of your inventory?
At Mediavine, we just don’t show an ad. Since we use header bidding, we’re able to simply not display the ad unit if there’s not someone willing to pay at or above the floors we set. We’ve decided that fewer ads is a better user experience and we’d rather those users enjoy your blog, potentially sign up for your newsletter, opt-in for push notifications, or follow your social media channels rather than shoving a belly fat ad in front of them that could potentially make you fractions of a penny.
In fact, we’ve often found during our A/B tests that setting floors as high as that ridiculous $1.00 mentioned before causes no negative impact to revenue.
How is that possible if you’re letting up to 30% of your ads go unserved? Well think about how many $0.01 ads it would take to equal our $1.00 ad. 100 of them.
The math works. So be bold. Don’t go for 100% fill and your users and revenue will thank you.
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