A media buyer is participating in a bidding environment where the clearing price is determined exactly by the highest submitted offer. How does this specific dynamic influence the buyer's optimal bidding strategy?

In a first-price auction , the winning buyer pays the amount they actually bid, not the next-highest bid. Google’s Display & Video 360 documentation states that non-guaranteed auctions can be first- or second-price, and that inventory goes to the highest bid above the minimum CPM. Google Help Because the clearing price equals the submitted bid in this auction type, bidding the full private valuation can overpay relative to the competitive threshold needed to win. That is why the rational strategy is bid shading : bidding just above the estimated next highest offer rather than bidding the full maximum value. Google Help+1