What Is a Demand Side Platform (DSP) and How Does It Work? Demand Side Platform Examples 2022 Free Guides
What Is a Demand Side Platform: DSP allows buyers of digital advertising inventory to manage multiple ad exchanges and data exchange accounts through one interface. Real-time bidding to display advertising online is done within ad exchanges, and by using a DSP, marketers can manage their bids for banners and the price of the data they are overlapping to target their audiences. . Like paid search, using DSP allows users to optimize based on established key performance indicators, such as effective cost per click (eCPC) and effective cost per action (eCPA).
What is a Demand Side Platform?
What Is a Demand Side Platform : A (DSP) demand-side platform is a type of software that allows an advertiser to buy advertising with the help of automation. Because they allow mobile advertisers to buy high-quality traffic at scale with minimal friction, DSPs are a powerful marketing automation tool.
There are two important stages in the operation of a demand-side platform. First, the advertiser uploads the creative, sets up the targeting, and sets a budget for their campaigns. All this can be done through the control panel. Once the campaign creative is uploaded, the DSP searches its network of publishers for sites and mobile apps that fit the advertiser’s criteria and bids on the placement. After this, the DSP resolves the bid, places the ad, and handles the payment, all in a matter of milliseconds. “What Is a Demand Side Platform“
Why are demand-side platforms important?
The most noticeable way in which DSPs are important to mobile marketing also applies to automation in general: This process allows marketers to avoid spending time and energy on something that can be completed by an automated machine. Instead of manually contacting hundreds of publishers with offers to advertise, DSPs help advertisers quickly set up campaigns and manage them with ease. This allows user acquisition experts to spend more time working on other valuable areas, such as user base segmentation, to improve long-term performance. What Is a Demand Side Platform.
Another reason DSPs are proving particularly useful for mobile advertisers is that campaign performance can be managed in real time. Instead of having to wait for a campaign to end, mobile advertisers can easily adjust campaigns from DSPs without causing any disruption.
This means that advertisers can spend money on a DSP more quickly if a campaign is performing well, and poorly performing campaigns can be pulled to prevent unnecessary damage.
Additionally, the automated element of DSPs means advertisers can easily scale their efforts on mobile. Previously, advertisers’ efforts to expand could be hampered by physical constraints such as geographic location. DSPs allow advertisers to overcome this by allowing them to buy traffic with new publishers, and in new places, with ease. This helps mobile advertisers take advantage of the globalized nature of the mobile app economy. What Is a Demand Side Platform?
How Does a Demand Side Platform Work?
What Is a Demand Side Platform: Demand-side platforms is a type of tool for individual networks. If you’re managing ads through the Google Display Network manager, you’re buying impressions only from Google publishers. If you’re using Facebook Ads Manager to buy ads, you’re buying impressions on Facebook or Instagram specifically. Demand-side platforms are independent of these networks. They are third-party software that allow you to buy, analyze and manage ads on many networks from one place. What Is a Demand Side Platform?
In the programmatic advertising landscape- demand-side platforms provide advertisers with all the information they need to buy advertising from a publisher. They do not own or buy media directly from publishers, but communicate with a supply-side platform through an ad exchange.
Demand Side Platform How Does it Work?
What Is a Demand Side Platform: SSP allows publishers to list that inventory on the ad exchange and communicate with DSPs about the details of an impression.
If that impression is from a marketing-manager who has visited your demo post-click landing page before, it is more valuable to you than someone who has never visited your website before. In that case, your DSP is likely to bid higher for the impression. Winning the bid will depend on how valuable this impression is to other businesses. Perhaps you have abandoned your cart on an e-commerce website. If that’s the case, the e-commerce website can bid more to post an ad that takes you to the checkout page. It all depends on the bidder’s budget and the value of the print. All of this is automatically facilitated by the SSP, DSP, and the ad exchange between advertisers and publishers.
Points of How Does a Demand-Side Platform (DSP) Work?
Advertisers use demand-side platforms to replace manual ad buying with an automated, real-time bidding platform. The entire process can be summarized in the following steps:
- The advertiser selects his target-audience and uploads the ads he wants to publish.
- Publishers make their ad inventories available on the DSP through ad exchanges and supply-side platforms.
- These platforms offer the ad-impression to the DSP, which makes the decision to send an offer to buy the impression based on the relevance of the targeting criteria.
- The advertiser competes with other advertisers for the impression of the ad by bidding in real time.
- The demand-side-platform buys the impression and the ad is displayed on the publisher’s website.
- This entire process takes place in milliseconds when someone visits the publisher’s site.
What is the Difference Between DSP and SSP?
The Supply Side Platform (SSP) is a technology platform used by publishers to connect their inventory to ad exchanges. An SSP allows publishers to filter ads by advertiser and other criteria, as well as set different rates for ad slots to define the cost.
DSP refers to the demand side platform. Allows buyers of digital ad inventory to manage multiple ad exchanges through one interface.
Buyers typically include trading desks, agencies, or advertisers directly. The demand-side platform must connect to an SSP to allow the buyer to bid on digital inventory.
In a nutshell, a DSP and an SSP connect to different parts of the programmatic ecosystem. A demand-side platform (DSP) is a tool used by advertisers to help organize ad buying, while publishers use a supply-side platform to automate the sale of ad space, which is the supply side. from the supply side to the demand side. Platform.
What Are the Main Components of a Demand Side Platform (DSP)?
Although different-companies may have different elements or different names, they all share a similar structure to serve their function of serving ads programmatically.
Let’s take a closer look at the components that make up many of today’s DSPs.
The bidder is the most important-element of the DSP as they are the one who bids on ad impressions in a real-time bidding (RTB) process. As the RTB process completes in milliseconds, it is crucial to be able to execute the offer as quickly as possible. Most DSPs use multiple data centers spread across the globe to minimize latency. Demand-side platforms use analytics to forecast print bids based on historical information.
The DSP’s ad server is what actually serves the necessary add elements to the publisher’s website. But they do much more than that. Ad servers also track impression and conversion data, which can then be used to optimize the ad campaign. They also have fraud prevention functionality, to detect fake ad inventory. A demand-side platform can have its own ad server or integrate with an external ad server.
Campaign tracker and reporting
A key-element of a DSP is the ability to track and record data about ad effectiveness: impressions, ad viewability, clicks, CTR, conversions, ad spend, etc. This is then presented in a reporting dashboard and used in ad campaign optimization.
DSPs record user-data when they view an advertisement served by the DSP. Over time, they build a profile of the user, which allows them to assign certain characteristics and place them in an audience segment, based on the type of content they are consuming, where and on which ads they are clicking. The user profile database is used in ad optimization and remarketing campaigns.
This element may be known in DSPs as the banker or teller. It is what allows the advertiser to define the budget parameters of the campaign, such as defining a maximum budget for the campaign. The budget manager can also define rules for how the budget is spent.
DSPs integrate with ad exchanges and SSPs for ad slots, but also integrate with other tools to increase their functionality, such as data management platforms, analytics platforms, payment gateways, and brand security solutions, which enhance risk management capabilities of the DSP.
Ad exchange and SSP integration
One of the-benefits of working with a DSP is the ability to reach multiple ad exchanges and supply-side platforms. Integrating multiple supply sources allows a demand-side platform to consolidate and centralize the ad buying process, allowing an advertiser to have broad reach across multiple channels from a single source. Therefore, an advertiser would expect their DSP to integrate with various ad exchanges and SSPs.
Benefits of Using Demand-Side Platforms
What Is a Demand Side Platform : DSPs are very popular because they have the tools and data to create a compelling and targeted campaign. It makes the process efficient and productive in the long run.
Additionally, demand-side platforms allow organizations and advertisers to manage advertising campaigns in a highly competitive and dynamic marketplace. Other benefits you will get from using the software include:
Online-advertising can be cumbersome due to the cumbersome processes involved, such as launching ads, retargeting leads, downloading reports, and more. DSPs simplify these processes by automating them. It will only take a few clicks to get started.
Global Reach and Integration
You can find DSPs that allow access to premium-ad inventory. These connect with other international ad exchanges and partner with local publishers to increase their global reach. You will acquire and close deals with clients around the world with increased use of the Internet. You can also bid on inventory anywhere in the world.
In addition to global reach, using DSP allows you to deliver only relevant ad campaigns to your audiences due to its advanced targeting capabilities. The platform targets specific demographics like gender, language, interests, devices, geographic locations, etc. You’ll create personalized ads to convert leads and close more deals with the right targeting.
Your choice of inventory will make or break your ad campaign. Advertisers can pre-define the types of inventory they wish to purchase before the actual process begins when using DSP. It makes it easier for you to succeed in your advertising campaign. For example, when buying in-app ads for better engagement, you just need to choose the necessary inventory and the DSP will do the rest.
With DSPs, users have access to detailed data important to improve advertising efforts. Advertisers can track all ad campaign performance in real time. You’ll also get reports on website traffic, click-through rates, page views, and more.
DSP is valuable to-anyone who wants to use the technology to purchase ad inventory. It usually offers full support to ensure that beginners and experts alike use the software.
What Are the Types of Demand-Side Platforms?
There are 2 types of DSPs: self-service and full-service DSPs.
A self-service DSP is just a platform that an advertiser can use to buy advertising. Campaign ideation, execution, and reporting are handled by the advertiser’s team or agency.
A full service DSP behaves more like an agency. They provide an additional service through an account manager. An external team at the DSP takes control and responsibility for the advertising campaign from start to finish. It is more expensive and the advertiser has less control and flexibility over the execution of the campaign, but it is more convenient for advertisers.
Best Practices for Managing DSPs and SSPs
You can apply several best practices to help you get the most out of any ad technology you use. These include:
Understand Available Inventory
When you work with DSPs and SSPs, you will need to manage various types of inventory. It would be better to select the right platform for specific business needs that require careful thought. Find technical capabilities across multiple platforms and access inventory needs.
Advertisers and publishers alike should consider the various ad formats to assess whether they can handle static images, rich media, video, native ads, and full-screen interstitials. Other solutions can also help meet the needs of your audience.
Check for Targeting Capabilities
A critical feature of the demand-side platform is that it allows you to quickly reach your customers at the right time. The best way to decide whether or not the DSP will work effectively and target your audience is to check your device options, geographic locations, operating systems, and more. It would also help to understand how to get data for analysis.
It’s a good idea to start your DSP engagement by reaching out to various publishers to effectively target your audience. The goal of every business campaign is to scale very quickly, but the strategy may not prioritize impressions over conversions from the start. Expand your audience to get solid data that you can use to support and optimize your campaigns for an effective long-term strategy.
Prioritize Brand Protection
DSP and SSP programs make the programmatic ecosystem efficient by automating some processes. Automation is valuable in the digital ad space, but it can also come with some risks. Choosing a program that can protect you from fraud detection is essential to help protect the security of your brand. For example, advertisers and publishers can enhance brand protection by blocking or allowing certain apps and app categories while partnering with DSPs and SSPs.
Pros & Cons of using DSP advertising?
- Most DSPs offer full transparency into what types of ad placements you’re buying, tracking poor deals and looking for fraudulent ads.
- If you often manage ad campaigns on more than one network, DSP dashboards ensure a great overview and easy management of everything, which can save a lot of valuable time.
- Thanks to DMPs, marketers can collect valuable data from users. The more data, the more accurate the targeting. And precise targeting allows for more personalized ads and messaging, leading to higher conversions.
- DSPs not only give you the most suitable ad placement, but also allow you to buy impressions on platforms with quality audiences. With DSPs, you don’t have to worry about wasting your money on empty traffic.
- You can analyze ad placements and their performance right on the demand-side platform. This allows you to catch any errors right away and fix them without wasting your budget.
- The process can be inexpensive, but many DSPs with various cost models can be quite expensive on the whole. Some may require monthly fees, or even include hidden costs, increasing your overall ad spend.
- But we will expand on this including the intricacies of a DSP in the next part of the guide.
- When using such an automation marketing tool, there is always the risk of buying fraudulent impressions, and not all DSPs have sufficient ad fraud detection capabilities.
How Does Targeting Work In a DSP?
There are several ways an advertiser can run targeted advertising campaigns with a DSP, but at the heart of it all is data.
For example, an advertiser might target users based on the following data:
Behavioral data: includes information about user behavior and interests, such as which websites you have visited, what products you have purchased, which advertisements you have interacted with, etc.
Contextual Data: Includes information about the website or mobile app, such as the URL, categories, and page content.
Demographic data: includes information about the user’s location, age, job position, gender, etc.
But How Does a DSP Access this Kind of Information?
Typically, demographic and behavioral data would have to be imported from a third-party data broker or DMP, which would have been collected from a variety of online and offline sources. The DSP would sync cookies with the DMP to exchange user data, which can then be used for targeting.
Other types of data, such as contextual data or even user agent data (for example, browser type, device advertising ID, and operating system), are typically transmitted during the bid request from ad exchanges or SSPs.
Is Google Ads a Demand Side Platform?
The Google Display Network (GDN) is an extension of the Google Ads (formerly Google Adwords) platform that allows people to target individuals when they post video and banner ads.
A demand-side platform (DSP) is a platform that allows people to purchase ad space programmatically online.
Who Are the Main DSP Companies? Best Demand Side Platform Examples
Over the past decade, dozens of DSP companies have entered the ad tech landscape, with many specializing in specific areas such as video or native content.
Below are some of the more well-known DSP companies:
Sizmek is one of the oldest ad tech companies in the industry (originally founded under the name Eyeblaster). In addition to creating their own solutions, they’ve also acquired other ad tech companies over the years, including Rocket Fuel for $145 million in 2017.
MediaMath, founded in 2007, is one of the first DSPs to emerge on the market, and one that often comes up in the context of online advertising. The company provides advertisers and sellers with tools to buy ads online through a single interface. Its integrated DSP and DMP are exclusively aligned with the buyer. The company prides itself on alignment and transparency, full funnel and multi-channel approach, performance, global scale, and extensibility.
Headquartered in Copenhagen, Denmark, with offices around the world, AdForm offers advertisers and agencies an open and transparent advertising technology platform. Its DSP enables media buyers to purchase inventory in different formats and improve campaign performance with the help of its real-time algorithmic optimizations.
BrightRoll, formerly owned by Yahoo and acquired by Oath in 2017, is an advertising platform that includes a real-time bidding marketplace and powers programmatic video. It is used by brands, agencies, agency trading desks, demand-side platforms (DSPs), and ad networks, and enables them to connect with digital audiences to support ad campaign goals.
Criteo is a DSP that provides personalized retargeting. The platform delivers personalized online advertisements to consumers who have previously visited the advertiser’s website. The company currently operates in a total of 30 markets around the world and is headquartered in Paris, France.
Double Click for Bid Manager (DV360)
DoubleClick Bid Manager (also known as DBM) is Google’s leading demand-side platform (DSP). It offers agencies, trading desks and advertisers access to the world’s most exclusive collection of display, video, native and mobile inventory available in real time.