Historically, programmatic auctions were running a second price model, where the highest bid would win the auction and then pay $0.01 more than the second placed bid. This allowed advertisers to bid higher than what they thought the impression was worth and then the auction mechanics would dictate the true price paid to be lower than the bid price. Now that auctions have moved to first price, advertisers needed to adapt or they would end up paying a higher price. Bid shading is that adaption, where advertisers analyze bid history and reduce their live bid price to reduce their bid cost. At Publift, we’re constantly looking into auction dynamics to ensure that we’re increasing the attractiveness of inventory and reducing the effect of bid shading.