Ad monetization for publishers 101

If we look at the earliest form of ad monetization, it may resonate the “waterfall system” (not entirely gone yet), which is the process used by a publisher to sell remnant inventory, consisting of the strict regulation of priorities depending on the campaign type.
When it comes monetization, there are two types: primary and secondary.
– Primary monetization refers to all direct and premium sales activity and guaranteed sponsorships.
– Secondary monetization is the set of all non-guaranteed selling attempts.
At the very beginning of the programmatic and yield revolution, sellers thought of these tiers as totally separate elements for monetization. Indeed, the waterfall developed because pubs needed a simple way within their 3rd-party ad server to separate premium and non-premium inventory.
But soon was clear that waterfall was a limited and inefficient solution, plus Google introduced Dynamic Allocation within its ad server, bypassing the waterfall completely.
This setup caused a lack of competition (other SSPs couldn’t win a bid) and lower prices, costing revenues to pubs.
Then, “holistic approach” started to spread out, offering pubs greater flexibly between tiers by creating a maxi tier that make the non-guaranteed part compete with the premium one
Other sources: see in the LinkedIn comments.
Previously posted by Luca Brighenti via LinkedIn. 

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