Karolina Bendryk
Lillia MatsokhaSome monetization businesses advocate for using a lower bid floor as a “low risk” approach. Others maintain their current bid floor setup for months, if not years, due to a lack of resources. Both of these approaches are red flags for your revenue. Why?
We explored this and more with Lillia Matsokha, VP of the Client Service Team at TeqBlaze. She shares her thoughts on key bid floor issues that traffic monetization businesses face and how TeqBlaze helps address them.
Karolina: Why is it so challenging to set up bid floors?
Lillia: For publishers, the main challenge is the dynamic nature of programmatic advertising. It requires constant monitoring of the market to understand trends, comparing them to internal metrics, and attempting to determine the optimal bid floor. It is hard work that requires time and effort, but even then, it doesn’t guarantee a mistake-proof result, which is also a problem.
And what about the supply-side perspective?
Intermediaries, such as SSPs and ad exchanges, confront a different set of challenges. Their core objective is to maximize publisher revenue from inventory sales. This requires optimizing floor prices to align them with market demand and thus increase the likelihood of DSP responding to the bid request, and here, problems emerge.
An SSP’s/ad exchange’s performance depends directly on the bid floor set by the publisher, as well as on traffic quality, auction setup, supply chain integrity, and so on. If the publisher sets this floor price incorrectly, it becomes more complicated or even impossible for the supply partner to sell inventory. The actual impact depends heavily on the traffic type, market demand, and auction structure, but, typically, a bid floor that is too high can result in a low fill rate, while a bid floor that is too low poses risks of revenue loss. However, SSPs and ad exchanges can also make mistakes, such as setting a single bid floor for all types of traffic, regardless of its quality.
Can publishers and supply partners handle those issues when setting up bid floors manually?
No. Humans can’t monitor market trends and metrics nonstop. Nor can they quickly analyze massive volumes of data. Without this, setting the bid floor correctly is almost impossible. Yes, “almost” impossible. A small SSP with a few connected publishers might handle manual setup, but what if you have fifty or more publishers? That’s a tricky, unsustainable task. For this reason, companies often use static bid floors. These remain unchanged for weeks or even months—a direct path to under-monetization. Why? A static bid floor overlooks market fluctuations, so it can be too high or too low in most cases, resulting in lost revenue. For the supply side, this is especially critical as they may lose new clients and partners. Just think: which publisher or intermediary will partner with an SSP that provides them with lower revenue compared to others? That is a problem — and a risk — that every traffic monetization company should deal with.
Manual setup vs SmartFloor: comparison table
Criteria | Manual bid floor setup | Bid floor setup via SmartFloor |
Pricing model | Static: remains unchanged for weeks, ignoring market fluctuations. | Dynamic: ML algorithm automatically calculates the optimal price depending on the market situation. |
Pricing relevance | Unstable: Typically too high or too low | Adaptive: Dynamically adjusted on a per-auction basis using real-time bid request signals and historical data. |
Analysis speed | Limited by human capabilities and standard working hours. | Real-time: ML algorithms track data and adapt to changes 24/7. |
Impact on revenue | Unstable: High floors kill fill rates; low floors reduce potential revenue. | Maximized yield due to aligning floors with real-time market demand. |
Impact on win rate | Chaotic: Inaccurate pricing leads to lost bids and dropping win rates | Highly positive: By providing relevant prices, it fosters predictable performance for DSPs, motivating them to bid more often |
Partner retention (SSPs/DSPs) | Risk of client loss: Issues with the price setup lead to lower revenue and make publishers look for other SSPs. Unstable win rates cause DSPs to offer lower bids. | Stronger retention: Minimizes price setup issues, driving publishers’ revenues and motivating them to stick with their SSPs, while stable win rates keep DSPs actively buying. |
How can companies mitigate the problems mentioned?
By using dynamic price models. TeqBlaze offers its own solution — SmartFloor. It is designed to optimize bid floors in accordance with real-time auction signals and market conditions.
Is it a separate service that can be installed on any platform?
SmartFloor is part of the Smart Bidding Pack, which comes with TeqBlaze’s white-label SSP+ad exchange platform. It relies on machine learning technologies to track and evaluate massive datasets and optimize bid floors, reducing operational overhead. A user only needs to set an initial bid floor value and start bidding. Should key performance indicators — such as revenue yield or win rate — drop, SmartFloor meticulously analyzes auction dynamics to identify the cause. If a low bid floor is causing the issue, the system will adjust it accordingly. This, in turn, motivates DSPs to respond with higher bids as well. Will it affect existing contracts between the sell-side and the buy-side or custom pricing agreements? Good question. Smartfloor works strictly within manually set baseline pricing boundaries. This means it never overrides your minimum prices, thereby guaranteeing zero disruption to any existing agreements.
What other competitive advantages does SmartFloor offer?
SmartFloor is a competitive advantage in itself. It helps maximize publishers’ revenue, which, in turn, motivates them to stick with their SSPs and ad exchanges. In other words, tools like SmartFloor help the supply side attract more publishers. Furthermore, this pricing efficiency boosts demand-side engagement, driving higher buyer activity and more consistent bidding participation from DSPs.
Additionally, Smartfloor allows smaller businesses, which may not have large AdOps teams, to operate more efficiently, while larger organizations can reallocate their teams’ efforts to more strategic tasks.
How does SmartFloor work?
As mentioned, SmartFloor continuously analyzes multiple data inputs to refine precise pricing in real time. This data includes:
Data analyzed by SmartFloor
Do you have any interesting practical cases regarding SmartFloor that you’d like to share with us?
Sure. We have clients who use SmartFloor constantly and experience revenue growth as a result. One notable example involved a client who was facing a high rate of lost bids in publisher-side auctions. Their primary issue was an excessively low bid floor, set at just $0.34. Consequently, their win rate in these crucial auctions hovered around 24.02%.
After SmartFloor intervened and adjusted their bid floor upwards to $0.42, the picture changed: the client’s win rate climbed to 29.03%. In total, revenue increased from $377 to $419. Like they say, feel the difference. Another essential fact: without SmartFloor’s intervention, it might take significantly more time to determine the reason for lost bids and fix the issue.
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Setting up a bid floor manually is, plainly, a pain. But that’s only the case if you’re stuck doing it manually. Using machine learning algorithms like SmartFloor is an entirely different story. As you’ve seen, it isn’t just minor upgrades; it's a necessity that enables your business to operate more efficiently.
At TeqBlaze, we specialize in offering solutions exactly like SmartFloor. Each is designed to solve a specific, complex task, but their collective goal remains consistent: to boost your effectiveness, increase your revenue, and simplify your daily operations.
Interested in learning more? Let’s talk. Or, if you need more information before making a decision, explore our client reviews and testimonials.
FAQ
How much does SmartFloor cost, and when will it pay for itself?
SmartFloor operates within our white-label SSP and comes at no extra cost to you. While the algorithm begins analyzing auction signals immediately upon activation, measurable revenue outcomes and ROI develop over time as the machine learning model completes its initial learning phase. The exact timeline and outcome depends on your specific setup, monetization strategy, and traffic volume. If you have more questions, contact our sales team. They will guide you through the financial details based on your business model and strategic plans.
What do we need to enable SmartFloor, and how long does integration take?
As SmartFloor is part of the Smart Bidding Pack, which is native to the TeqBlaze white-label SSP platform. It does not require additional setup. To use SmartFloor, an SSP owner only needs to toggle it on.
How will SmartFloor affect our existing publisher and DSP agreements?
SmartFloor is designed to operate within your manually set baseline pricing boundaries, ensuring zero disruption to any existing agreements.
What risks does SmartFloor remove compared to manual bid floors?
SmatFloor eliminates manual errors. Manual setups often lead to two extremes: floors set too high or floors set too low. SmartFloor mitigates these risks by capturing the true market value of inventory.
Can SmartFloor show a clear ROI in the first 30–60 days?
It depends on your business model, traffic types, monetization complexity, and strategic goals. However, TeqBlaze provides all clients with a dedicated Client Growth team to support them every step of the way and ensure high monetization results.
