Floor Price

A floor price is the minimum a publisher will accept for an impression, enforced in the auction: bids below the floor never clear. It is the sell side's lever in programmatic price discovery — the counterweight, in the FIRST-PRICE era, to the buy side's BID SHADING — and its setting is the price-times-volume trade the FILL-RATE entry describes from the volume side: higher floors discard cheap bids (less fill, dearer clears), lower floors fill more at whatever the shaded bids offer.

The format history explains the modern stakes: under second-price auctions floors did double duty (a floor just under the winner's bid could lift the second-price clear — the 'soft floor' games that fed the era's opacity), while unified first-price simplified the machinery: the floor is a reserve, bids clear at their own value above it, and the seller's pricing power lives in setting reserves that reflect what attention is worth per segment. The craft is segmentation and data: one site-wide floor is a blunt instrument, so dynamic flooring tunes by placement, format, geo, audience addressability (consented users with identity clear higher — price them so), demand seasonality (the CPM-INFLATION calendar from the sell side), and channel — with the floors-versus-fill curves read per segment, since the revenue-per-request peak sits at different floors for premium video and long-tail display. The standing interactions: floors negotiate against buyers' shading algorithms (each learns the other — the AUCTION-DYNAMICS arms race in miniature), deal IDs and private marketplaces carry their own negotiated floors above the open auction's, and transparency rules apply (buyers resent — and DSPs detect — floors that move mid-auction; the soft-floor era's tricks now cost demand relationships). The honest objective stays the fill-rate entry's: revenue per request, with floors as its dial.

Floor prices matter to anyone selling impressions — they are the sell side's half of every clearing price the buy-side entries discuss. They matter most at era boundaries and audits: floors set in the second-price years and never revisited underprice premium inventory systematically. The discipline is segment-level tuning from auction data, dynamic floors where volume justifies them, deal-tier coherence (private floors above open floors above remnant), and the revenue-per-request curve consulted before any floor moves.

Reserve prices are auction theory's oldest seller lever; programmatic's floor-price era ran through the second-price years' soft-floor opacity into first-price's clean reserves, where dynamic flooring and shading algorithms now negotiate clearing prices request by request.

Etymology: source.

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