Written by Krisztián Stark
Key takeaways
- Ad mediation lets several ad networks compete for the same ad request, so more requests are filled at better prices.
- A waterfall calls networks one by one in an order based on eCPM values; bidding runs one real-time auction where all bidders compete at once.
- Most apps now run a hybrid: bidding where networks support it, and a waterfall for the rest.
What is ad mediation?
Ad mediation is software that sits between your app and several ad networks and decides which network gets to show an ad for each ad request. Instead of relying on one network, you connect several through a mediation platform such as Google AdMob, AppLovin MAX or Unity LevelPlay, and they compete for your inventory. Google puts it simply: mediation lets you manage the ad sources that serve ads in your apps in one place and helps find the best available source to fill each request.
Mediation does two jobs. It raises the fill rate, because when one network has no ad, another can step in. And it raises the price you get per impression, because networks compete. How they compete is the difference between the two models: the waterfall and in-app bidding.
How a mediation waterfall works
In a waterfall, networks are called one at a time, in a fixed order, until one returns an ad. The order comes from a price estimate for each network, its eCPM, not from what the network would actually pay for this impression. Google’s AdMob guide says waterfall mediation “calls ad sources one-by-one based on the average eCPM you set, not what the ad source is willing to pay”.
- The app asks the mediation platform for an ad.
- The platform calls the network with the highest eCPM in the list.
- If that network has no ad at that price, the platform moves to the next one, and so on down the list.
- The first network that returns an ad shows it.
Publishers often add the same network several times at different price floors, so a network gets a chance at a high price first and again lower down. Unity LevelPlay calls each of these setups an instance, and its docs describe using multiple network instances in a waterfall to improve fill.
The weakness is that the order is based on averages. A network that would have paid a lot for this particular user may sit below one that usually pays more but does not value this user at all. Each step down the list also adds waiting time, and keeping the order right by hand takes work. Platforms help with that: AdMob can optimize waterfall ad sources, adjusting their eCPM values from historical data per country, and AppLovin MAX has an Auto-CPM option that updates a network’s price to match its reported CPM.
Illustrative waterfall: three networks and one rewarded slot
A game’s rewarded video slot has three networks in its waterfall, ordered by average eCPM: Network A at $12, Network B at $9, Network C at $5. For one user, A has no ad at $12, so the request moves on. B fills at $9. But C, lower in the list, would have paid $14 for this particular user, and never got asked. In a bidding setup, all three would have bid at once and C’s $14 would have won. The networks and prices are invented to show the mechanics.
How in-app bidding works
In-app bidding replaces the ordered list with a single real-time auction. When an ad request comes in, every participating network bids at the same time, based on what this impression is worth to it, and the highest bid wins. Google’s AdMob help says bidding “calls all participating ad sources simultaneously”, unlike a waterfall that calls them one at a time. Unity’s LevelPlay documentation describes it as a fair auction “where multiple ad networks can compete in real-time for impressions”, where the network with the highest bid wins.
Because each network prices the actual impression, bidding removes the guesswork of manual eCPM values, and because networks are asked at once, it cuts the time spent walking down a list. AppLovin’s MAX documentation advises publishers to prioritize bidding networks whenever possible, saying it reduces manual waterfall maintenance and latency.
Hybrid mediation: bidding and waterfall together
Not every network supports bidding, so most setups mix both. The major platforms each describe how they combine them:
- Google AdMob: bidding runs first in real time, and the winning bid is placed into the waterfall at its eCPM, alongside the waterfall ad sources. If a waterfall source has a higher eCPM, it is called first.
- AppLovin MAX: bidding and traditional networks compete by the highest CPM to serve the impression. For non-bidding networks, you set a CPM price, either by hand or with Auto-CPM.
- Unity LevelPlay: bidding networks and waterfall instances are managed together in the mediation setup, with instance rates and country groups for the waterfall part.
Waterfall vs bidding at a glance
| Waterfall | In-app bidding | |
|---|---|---|
| How networks are called | One by one, in order | All at once, in one auction |
| Price used to decide | Average eCPM you set or the platform estimates | Each network’s live bid for this impression |
| Setup work | Price floors, instances, regular reordering | Mostly adding the networks |
| Speed | Slower with every step down the list | Faster, one round |
| Where it is still used | Networks without bidding support | Networks that support bidding |
What to watch when you run mediation
- Revenue per user, not eCPM alone. A higher eCPM with a lower fill rate can earn less. Track revenue per daily active user; ARPU and ARPDAU explains the formulas.
- Price floors by country. A floor that works in the US can block most fill in lower-priced markets. See eCPM vs RPM for how to read the numbers.
- SDK weight. Every mediated network usually means another adapter or SDK in your app to integrate, test and update. What is an SDK? covers the trade-offs.
- Testing tools. The platforms offer debuggers and test modes; use them before and after every change.
Where does an offerwall fit next to mediation?
Mediation manages ad formats such as banners, interstitials and rewarded video, which are priced per impression. An offerwall is priced per completed action, so it usually lives beside mediation as its own placement: a “get more coins” screen where users choose between a quick video and a bigger offer. Offerwall vs rewarded video compares the two, and monetizing a mobile game with an offerwall covers the setup.
An SDK-free offerwall beside your mediation stack
Sharklio is not a mediated ad network and does not plug into AdMob, MAX or LevelPlay. Its offerwall is built to sit next to them without adding another SDK: your server signs one link, your app opens it in a WebView or browser, and your server credits users from signed postbacks. Publisher applications have not opened yet. Read how the Sharklio offerwall works, and leave your email in the form at the foot of this page to hear when they do.
Frequently asked questions
What is the difference between ad mediation and an ad network?
An ad network sells ads from its own advertisers. A mediation platform does not have to sell anything itself; it connects several networks and decides which one serves each request.
Is in-app bidding better than a waterfall?
For networks that support it, bidding usually prices each impression more accurately and with less manual work. Most apps still keep a waterfall for networks that cannot bid, in a hybrid setup.
What is a price floor in mediation?
The minimum eCPM a network must meet to serve an ad from a given waterfall position. Floors that are too high lower fill; floors that are too low can leave money on the table.
Which ad mediation platforms are most common?
Google AdMob, AppLovin MAX and Unity LevelPlay are widely used for mobile apps. Each supports bidding, a waterfall, or both, and each has its own SDK and adapters.
