By Iryna Kozirevych
Due to its high efficiency and automation capabilities, programmatic advertising is getting more and more popular. Therefore, if you have not tried this technology yet, now is the time to do it!
As an advertiser, you need to leverage a programmatic DSP solution. But what is a DSP? How does it work? What are the different types of such platforms? Understanding all these nuances may seem to be challenging, but our guide is here to help. Keep reading to find all the answers you are in search of!
What is a Demand-Side Platform (DSP)?
Let’s start with the DSP definition. So, DSP stands for a demand-side platform – it is a programmatic advertising solution that enables marketers to purchase ad inventory from a wide range of publishers automatically. Usually, the inventory is sold via real-time bidding (RTB) auctions, although some other options like header bidding are often available as well.
It takes less than a second for an auction to complete, which means that the process of buying ad space becomes much faster. Thanks to this, you can allocate additional time to your core tasks.
How Does a Demand-Side Platform (DSP) Work?
Now let’s discover how a DSP programmatic solution works. Such a platform is connected to multiple SSPs (these are supply-side platforms used by publishers to sell their inventory) and ad exchanges (these are where the auctions take place). These connections allow you to purchase ad space from apps, websites, etc. After you select a DSP that meets all your criteria (we will provide some recommendations in one of the next paragraphs), the next steps are as follows:
Campaign setup. You set up your marketing campaign within your DSP – this includes specifying targeting characteristics, setting up your bids, and uploading the creatives. Make sure to learn everything about your DSP in advance. Many platforms have features that enable you, for instance, to prevent overspending. Using such functionalities can make your campaign more efficient and cost-effective.
RTB auction. When an impression becomes available, a DSP receives a bid request, evaluates it, and then sends a bid response. The auction starts on an ad exchange.
Ad serving. After the winning bid is identified, the ad is sent to the publisher and displayed to a user.
Measurement and optimization. The DSP monitors the performance of the campaign and collects data about impressions, clicks, conversions, etc. This information is then used to adjust the strategy. This can be done both by the DSP and manually.
Note that DSPs also usually provide reports on campaign performance, ROI, reach, and other important aspects. You can leverage this data to improve your future campaigns.
What Are the Main Components of a DSP?
Now that the overall process is clarified, let’s explore the key components of programmatic DSPs. You already know that such platforms are integrated with SSPs and ad exchanges, but what are the other elements? Here is the answer.
Bidder
That is the key element of any demand-side platform – it is responsible for placing bids during RTB auctions. Most often, a DSP has several bidders located in different data centers to minimize latency.
Ad Server
The ad server stores creatives and the ad markup. Additionally, it serves ads to publishers’ websites or apps and tracks the impression and conversion data. Note that a DSP can have its own server or be integrated with an external solution.
Campaign Tracker
The tracker collects data about campaign performance: impressions, clicks, ad spend, and so on. This data is then sent to the reporting database.
Reporting Database
The reporting database is responsible for storing the data provided by the tracker and generating reports. You can access them via DSP’s user interface.
User Profiling and Database
When a user views an ad, a DSP records their data. Over time, the platform develops a more detailed user profile, which allows it to add the profile to a specific audience segment – for instance, according to the type of content a user interacts with. All this data is stored in the database and can be used for optimization and retargeting.
Budget Manager
The budget manager, also known as a banker or a cashier, allows you to specify the budget parameters and helps you prevent overspending.
Additional Integrations
While SSPs and ad exchanges are mandatory integrations for any DSP, the platform can also be connected with other tools: data management platforms, brand safety solutions, and others.
User Interface
Basically, the user interface is what you interact with to create and manage your DSP ads. When choosing a demand-side platform, request a demo, if possible, to make sure that the interface is user-friendly and convenient.
Types of Demand-Side Platforms
For marketers, an advertising DSP comes in two possible formats: self-serve and full-service. If you are planning to offer programmatic advertising services to your clients, you may want to consider a white-label DSP. Here are the key differences to help you make a choice.
A Self-Serve DSP
With a self-serve DSP, you create and manage your campaigns on your own, independently – this is a great choice in case you have an in-house marketing team. Alternatively, these tasks can be performed by a marketing agency if you cooperate with one.
A Full-Service DSP
In the case of a full-service DSP, the platform’s account manager is responsible for your campaigns. It is usually more expensive while you also have less control over your ads. However, this is still a good option to consider if you do not have a marketing team or lack experience in programmatic advertising.
A White-Label DSP
With a white-label DSP, you can offer programmatic services to your clients. It works like this: you select a white-label solution, and it gets rebranded and customized. Then, your clients can launch their campaigns via your platform (or you can do this for them as if it were a full-service DSP). Note that you can use your platform for programmatic marketing as well, which makes a white-label DSP a rather universal solution – you advertise and drive income at the same time.
Emerging Specialist DSP Categories
It is important to remember that the industry of programmatic advertising keeps evolving, with new trends continuously entering the stage. DSP demand-side platform advertising adapts as well, so here are the emerging solution categories to be aware of:
Mobile DSPs
Connected to mobile ad exchanges, such demand-side platforms focus on delivering advertising content to smartphone and tablet users. They offer a wide selection of ad formats to meet any marketing need.
CTV DSPs
CTV (Connected TV) marketing is gaining momentum, and, while many DSPs include CTV ads in the supported formats, certain platforms are tailored specifically for advertising on smart TVs and other related devices.
Video DSPs
Video DSPs are all about purchasing video ad space across YouTube and other similar platforms. In-app environments are often supported, too. Since video content can be very effective in terms of driving engagement, it is not surprising that certain demand-side platforms focus exactly on this type of advertising.
Benefits of a Demand-Side Platform (DSP)
Using a DSP in marketing has multiple benefits, including automation capabilities, enhanced targeting, and others. Let’s review them in detail.
Streamlined Processes
A demand-side platform automates the majority of processes, you only have to set everything up and monitor the performance of your campaigns to fine-tune the strategy on time. This way, instead of searching for publishers and placing ads manually, you can focus on more important tasks. Besides, since it takes an RTB auction less than a second to happen, your ads are delivered to users in an extremely quick way.
Expanded Reach
With DSP online advertising, you access an impressive variety of ad inventory across different environments: desktop, in-app, mobile web, CTV, DOOH (digital out-of-home), and others. Additionally, DSPs support a wide range of advertising formats. Considering these two facts, you can significantly expand your reach, deliver diverse advertising content to your audience, and enhance your omnichannel strategy.
Precise Targeting
DSP solutions are equipped with advanced targeting settings: IAB categories, location, language, connection type, device OS, and others. Many of them also offer retargeting capabilities and multiple filtering options. By using all these functionalities, you can ensure accurate targeting so that your ads will reach exactly those users who are most likely to click a button and convert.
Access to Top Inventory
With a DSP, it becomes much easier for you to get premium ad inventory (especially if you prefer header bidding or programmatic guaranteed deals instead of RTB). As a result, if your ads appear on top sources, your brand will look more credible to users. A DSP can help you build and maintain trust.
Cost-Efficiency
A demand-side platform can save not only your time but also money. First of all, you have total control over your budget. Secondly, by using diverse budget-related features, you can optimize your expenses and prevent overspending. This is why it is crucial to learn everything about your platform’s functionality.
Advanced Optimization
When you launch a DSP campaign, real-time optimization becomes possible. Besides, thanks to analytics and reporting capabilities, you can analyze the performance of your campaigns more effectively. The collected insights then help you both improve your currently running campaigns and understand how to enhance future ones.
Third-Party Integrations
DSPs can often be integrated with third-party solutions and tools (for instance, data management platforms). Thanks to this, you can boost the functionality of your platform and reach your goals even more effectively.
Complete Control
Yes, auctions are run automatically, but, as for all the other processes, you are in full control of everything: your spending, targeting, etc. You choose ad formats and environments, decide where your ads can be shown and where not, and apply different settings and features to adjust your campaigns and maximize their performance.
How to Choose the Right Demand-Side Platform: Tips from Attekmi
Using a DSP in programmatic advertising is a way to streamline the processes and increase the efficiency of your marketing campaigns. However, reaching these goals requires choosing the right demand-side platform. Here are the features that an effective solution should be equipped with:
A user-friendly interface. Even the most advanced DSP can be challenging to use in case its interface and navigation are confusing. Therefore, if possible, book a demo to learn more about your potential solution and the way it works.
A wide selection of ad formats and environments. A DSP should support the formats and traffic channels that you require. However, in general, the more options it offers, the better – this will ensure flexibility.
Advanced targeting and filtering settings. Again, the more options there are, the better. By applying these settings, you will increase the efficiency of your campaigns since your ads will reach exactly those users who are most likely to get interested in your products or services. Additionally, filtering capabilities can help you enhance your brand safety.
Retargeting capabilities. To reach users who have already expressed interest in your brand, choose a DSP that has retargeting features.
A range of programmatic buying models. The right DSP should enable you to purchase inventory not only via real-time bidding auctions but also, for instance, direct deals.
A set of optimization functionalities. An effective DSP should have a lot of optimization features that can help you prevent overspending, boost campaign performance, and so on.
Sophisticated analytics and reporting features. The success of advertising campaigns heavily relies on data. Explore what metrics a DSP tracks and how it represents the data – the metrics you need should be available, and the reports should be structured properly.
Trusted supply partners. You want your ads to appear on credible sources, so make sure to check the DSP’s traffic partners and see if you can access premium inventory.
When choosing a demand-side platform, it is also important to check user feedback on each of your potential solutions – this can help you make the final decision. In addition, discover how often the platform is updated with new functionalities. The programmatic industry keeps evolving, so the right solution must stay on track with this evolution. In case the last update was introduced a couple of years ago, this is definitely a bad sign.
Besides, pay attention to customer support. Even if you have some experience with DSPs, you may still need help from time to time. Therefore, get in touch with your potential provider to see how quickly it replies and how professional it is.
It would also be helpful to check if your potential DSP has won any awards.
Consider Attekmi Your Trusted Partner
At Attekmi, we offer a wide range of ad exchange solutions, starting from an entry-level platform and ending with a fully customizable option. However, that is not all – here are the services you can count on:
Custom AdTech development: we can build a unique solution according to your requirements.
Ad Ops outstaffing services: we can train an expert specifically for your business so that you will be able to focus on your core tasks while your operations run smoothly.
AdTech and Ad Ops training: we offer both team and individual training to help you enhance your knowledge and master new skills.
Whether you need to learn how to make the most of your advertising campaign or search for an experienced team to build your unique solution, we are here to help.
Does Attekmi look like the right choice? Let’s talk!
