What is a DSP?
A Demand Side Platform (DSP) is a piece of software used to purchase advertising in an automated fashion. It is used by advertisers and agencies alike to help purchase ads across a range of formats such as display, video and native.
Due to the shift of traditional ad buying becoming programmatic, DSPs allow the modern ad buying process to become more efficient and more reliable as manual interactions have been removed and instead replaced with the automated nature of the platforms.
Using a DSP, advertisers have the opportunity to buy individual impressions. Then, by levering the data available in a DSP, advertisers are able to prioritise the impressions that they want to buy. This is because they are far more informed about the impression they are buying and the user they are serving an ad to. Impressions can be bought via online auction or for a fixed price, directly with a publisher.
How does it work?
DSPs allow advertisers to buy impressions across a range of publishers and target specific users based on browser information such as browsing behaviour, time of day or location.
The first step in any programmatic campaign is setting it up in a DSP. Within a DSP, an advertiser can select the ad inventory that they would like to buy, the users they want to target and a host of other targeting criteria. The DSP sits on the ‘Buy Side’ of the programmatic landscape and is connected to the ad exchange.
If bidding within an auction, the advertiser would submit a bid based on how much they value the impression. If the bid is successful, the ad exchange hosting the auction informs the DSP that it has won the impression. The DSP then requests the ad to be served and delivers it to the publisher via the ad exchange to be served.
This process occurs within milliseconds; during the time it takes to load a webpage on a user’s device.
Key features of a DSP
As mentioned above, a DSP allows advertisers to automate the purchasing of impressions. It brings multiple features to allow advertisers to make more informed choices about the impressions that they are buying.
- One of the most prominent features of a DSP is the wide range of targeting criteria available when running a programmatic campaign. Location, audience, time of day and device are just a fraction of the targeting options available to advertisers.
- Advertisers can pinpoint their desired target audiences and environments to serve more specific messaging and drive more efficient campaigns.
- DSPs allow advertisers to leverage first, second and third-party data.
- Internal data can be imported into DSPs from sources such as websites, CRM (Customer Relationship Management) systems and DMPs (Data Management Platforms).
- Many DSPs are integrated with third-party data sources to provide data such as demographic, interest, intent and purchase history on users.
Reporting and Campaign Management
- DSPs allow advertisers to frequency cap their activity. This means that they can limit the amount of impression served to users. This is a key tactic used by advertisers to manage the efficiency of their campaign spend.
- DSPs have strong reporting functionality that allows advertisers to understand the key drivers of performance. The are several metrics and dimensions available to advertisers.
- High quality and premium inventory can be bought in DSPs.
- DSPs typically allow advertisers to buy across display, video, mobile and native formats. However, they are now offering emerging programmatic formats such as Connected TV, Audio and Digital Out of Home.
- DSPs compete on their ability to provide a wide range of quality inventory and some will have access to exclusive inventory, not available in all DSPs.
- A DSP has one central user interface where advertisers can easily manage multiple campaigns.
- Modern DSPs now use algorithms to automate much of campaign optimisation. They will use the vast data available to make more informed bids on each individual impression. This allows traders to spend more time on strategic optimisation decisions.
If you would like to learn more about DSPs and the entire programmatic ecosystem, please don’t hesitate to contact us.