What is Bidstream Data?

Ever wondered how some targeted ads can be so relevant while others seem to miss the mark?

Scratch the surface of the online ad world, and you'll notice that there's so much more than meets the eye, and one of the best examples of this can be found in the form of bidstream data—the information connected to every bid request publishers send to advertisers.

The importance of bidstream data is only set to grow, if recent statistics are any indicator. In 2020, US marketers were expected to spend $31.1 billion on location-specific advertising, which is enabled by bidstream data. And that figure is expected to grow to $38.7billion this year.

So, what's all the fuss about and why is this bidstream location data so critical to companies? Read on to learn more about bidstream data and how it can help your business grow.

What is Bidstream Data?

Bidstream data, short for bidstream location data, is any data connected to a publisher’s bid request. This includes data on the website or app, the ad format, as well as the visitor’s device type and their IP address.

This information is passed to the advertiser in order to allow them to decide whether to bid for the ad unit via real-time bidding (RTB).

Bidstream data is the lifeblood of online advertising and is transferred imperceptibly just before a user accesses a web page.

To get a clearer perspective on the nature of bidstream data, it is worth outlining some of the key elements that play a role in its creation.

Programmatic advertising has shifted much of the online ad marketplace to ad exchanges, which are platforms where publishers can sell their inventory to advertisers. To access an ad exchange and to enable transactions with their advertisers, publishers use a supply-side platform (SSP), while advertisers use a demand-side platform (DSP).

Using RTB technology, ad exchanges regulate the value of ad space. To get the bidding going, an SSP provides, on behalf of publishers, certain data to one or more ad exchanges or ad networks, which pass this on to advertisers through their DSPs. Advertisers receive this data as a stream—hence the term “bidstream data”.

Also known as a bid request, this data includes information about the inventory being offered, such as an ad unit's format, as well as the ad unit size. Technical data about the device used to access the web page, such as its screen size and IP address is also included, as is location data, such as the publisher's country code domain.

Finally, other info, such as data on first, second, and—for now—third-party cookies are also included in bid requests.

A couple of things are worth noting. First, regardless of whether an advertiser's bid is successful or not, the data in a given bidstream will be stored in a database until it's been deleted.

At a glance, this may raise concerns over data privacy; but it's also worth noting that a bid request never includes users' personally identifiable information.

Also Read: DMP vs DSP: What is the Difference?

How Is Bidstream Data Collected?

We've mentioned that bidstream data is transferred before you access a webpage. So how, you might be wondering, does it all happen so quickly?

Let's say, for example, that John Reader is visiting the homepage of review site Online Bookclub. Online Bookclub receives John's IP address and other details, adds information about the relevant ad spot, and, in doing so, creates a bid request.

Through Online Bookclub's SSP, the request is sent to an ad exchange where it's matched with bids from DSPs. The advertiser whose bid best matches the bid request—book light manufacturer Microlight—wins the request.

News of this match is then returned to Online Bookclub's SSP, which triggers the go-ahead for Online Bookclub to display the ad for Microlight's latest book light to John.

Such a process highlights how bidstream data can be effective in contextual targeting. Instead of focusing solely on a user's history, which in some situations can test privacy laws, bidstream data recognizes the fact that accurate data can be gleaned in the here-and-now—more on this shortly.

Does Bidstream Data Work Without Third-Party Cookies?

Google's announcement that it'll be phasing out third-party cookies in 2023 has, understandably, worried many advertisers. After all, how will they run personalized ads for their customers and prospects when the vehicle they've relied on for so long is no longer available?

But it's not all doom and gloom. A closer look at bidstream data shows that advertisers will still be able to glean important information from consumers without compromising privacy standards.

Someone browsing painting techniques on an online art blog, for example, will have their geographical location listed in the bidstream data that the blog's SSP sends to the DSP representing several brick-and-mortar art supply stores. If one of those stores is anywhere near the site visitor, their ads for paintbrushes will be a perfect match for the visitor.

Similarly, depending on the content a site visitor is viewing, other information that's integral to bidstream data—such as the device a site's visitor is using—may also be used to help advertisers target their ads. In short, the phaseout of third-party cookies won't compromise the ability of a publisher or advertiser to display relevant content.

How Can Bidstream Data Be Used?

As we've seen, the nature of bidstream data allows advertisers to target specific audiences. But as important as such targeting can be, the usefulness of bidstream data rests on something much deeper.

By identifying site visitors according to location data, bidstream data effectively gives advertisers insight into the most promising bidding areas. Once they've identified where potential prospects may be, advertisers are then able to focus more closely on who they wish to target, and how.

From a publisher's perspective, the utility of bidstream data lies in its malleability—that is, the fact that a given stream of data can be parsed into specific categories that will be of use to advertisers.

In this sense, depending on how it is parsed, bidstream data can be used to upsell a publisher's ad inventory. For example, publishers can offer ad space on pages that are not only popular with a certain demographic but whose visitors are more likely to buy specific products or services—in other words, high-value audience segments.

But the usefulness of bidstream data doesn't stop with publishers and advertisers. App developers can also use such data to fine-tune the impressions they achieve with their audiences.

And brands can use bidstream data to determine the efficiency of specific bidding areas, based on technical data such as the performance of certain browsers and URLs.

Benefits of Bidstream Data

By segmenting consumers according to specific data categories, bidstream data has certainly made it easier for online advertising to be more efficient. Here are some of the benefits for the key players.

Benefits of Bidstream Data for Publishers

• By providing detailed info about users and their inventory, publishers can sell their ad units at a high rate.
• Publishers can maximize the profits from their data sales by, for example, selling it to a data management platform (DMP), where audience data from various sources is collected and organized.

Benefits of Bidstream Data for Advertisers

• DSPs provide advertisers with the ability to segment users according to all the data provided during online bidding.
• Bidstream data affords advertisers the opportunity to better understand users, including how they might react to different content.

Benefit of Bidstream Data for Users

• Bidstream data significantly increases the likelihood that users will be shown ads that are relevant to their needs and wants.

What Is the Future of Bidstream Data?

So what does the future hold for bidstream data?

The imminent phaseout of third-party cookies won’t prevent advertisers from displaying ads that are relevant to their audiences. If anything, the location and device-specific information in bidstream data just might offer advertisers the second wind they’ll need in the new third-party cookieless landscape.

The phaseout of third-party cookies does present something of a challenge to bidstream data’s relevance, however. Tools such as universal ID (UID) afford publishers more control over their readers’ data. Essentially a first-party cookie, a UID will involve publishers obtaining a login ID—usually an email address—from a user, which can then be matched to the user’s device ID.

Once these UIDs are traded to ad tech platforms, visitors can be tracked across the internet. This will also help foster contextual advertising opportunities far beyond the ads available on publishers’ own sites.

Yet, one promising area for bidstream data could be modifications to the data itself, thanks to updates made to the Interactive Advertising Bureau’s (IAB) OpenRTB standard in 2018.

OpenRTB, a framework developed by the Interactive Advertising Bureau, was updated to offer more security and transparency in the ad supply chain. The standard is used to set proper conduct and rules for RTB on ad impressions. 

OpenRTB 3.0 requires publishers and advertising companies to revise their code to conform to the new policies on brand safety guarantees, making bidstream safer and more transparent in terms of bid requests.

In addition, the new protocol includes an open field for identity signals, which is designed to adapt to new ID products, according to Neal Richter, a senior figure within the IAB’s OpenRTB working group.

Final Thoughts

And that's a snapshot of what bidstream data is, and what it can do for your business. Whether you're a publisher or an advertiser, ensuring that your business is bidstream data-compliant, and then harnessing that data to your advantage will be critical to your success.

Among the hundreds of thousands of users who visit your website every week, the data about each of them will assist you to continue serving them with the products they need.

And as contextual targeting illustrates, such service may be something as minor, yet helpful, as an accessory to complement your customers' existing products—think John Reader, our bookworm, and his viewing of ads for book lights.

In short, learn to harness the data that will help you as a publisher or advertiser, and you'll be on your way to connecting with your customers.

Publift helps digital publishers get the most out of the ads on their websites. Publift has helped its clients realize an average 55% uplift in ad revenue since 2015, through the use of cutting-edge programmatic advertising technology paired with impartial and ethical guidance.

If you’re making more than $2,000 in monthly ad revenue, contact us today to learn more about how Publift can help increase your ad revenue and best optimize the ad space available on your website or app.