Support for fixed price deals has been one of the most commonly requested features for our Deals product for some time. While we are working on a complete overhaul to our Deals product, we will be releasing an update to our current product to support Fixed Prices.
What is a Fixed Price Deal?
Fixed Price Deals allow buyers and sellers to negotiate a specific price for a deal and ensure the same price is paid by buyers and the same revenue is earned by sellers on every impression. In addition to providing more transparency into programmatic transactions, this also allows both parties to better forecast the amount of spend/revenue for the deal. In standard deals that use second price mechanics, a buyer may not pay the negotiated rate if there is another bid between its bid and the deal price.
How Fixed Price Deals work
After a price is negotiated, the seller will input the "ask price" in the deal setup. On an impression where the deal is applicable, the buyer simply needs to bid with the
deal_id at a price greater than the ask price (plus any buyer fees they may have) to indicate they are willing to buy the impression. The bid will then compete in the auction based on the deal's priority and the ask price of the deal. If the bid wins the auction, the buyer will pay the
(ask price + buyer fees) and the seller will receive
(ask price - seller fees); these results will be the same on every impression for this deal.
If the buyer bids below the applicable price, they will not be eligible to win the auction.
Let's illustrate this a bit better with an example:
Fixed Price Deal between Buyer A and Seller Z: Ask Price $1.00 Buyer A has a revshare of 12% Seller Z has a revshare of 15% In the auction, Buyer A must bid at least ~$1.17 (rounded up for simplicity) to be eligible. If they do, (let's say they bid $5.00) the bid will compete in the auction at $1.00. If the bid wins the auction, the buyer will pay $1.17 and the seller will receive $0.85. These will be the payments/revenue values for every single impression transacted for this deal.
For buyers who aren't using Console and bid through another RTB platform, Fixed Price Deals will still work. We will send the correct auction type flag in the OpenRTB bid request (
pmp.deals.at = 3) that your DSP can use to identify this as a fixed price deal vs a standard second price deal.
We will be rolling this feature out to all clients who have access to our Deals functionality over the next few weeks. Keep an eye on our Console Release Notes page for the specific release date.
Once released, you can help us continue to improve the product by flagging any issues through normal support channels with
#fixedpricedeals in the subject line. This will help our engineers stay on top of issues.
UPDATE 4/13/17: As of today, Fixed Price Deals have been released to our platform. Our client documentation has more details for those who are interested in trying our the product.