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What Is a Demand Side Platform (DSP)?

As your business grows, you’ll need to accelerate your digital advertising campaigns and maximize brand awareness ASAP. The more people that are aware of your brand, the more likely your company will make a profit.

This is easier than ever with demand-side platforms (DSPs). Today, let’s take a closer look at DSPs and examine how they work, why they’re useful, and why you should consider using a DSP for your marketing campaign.

What Does a Demand Side Platform Do?

A demand-side platform is a software platform that lets an advertiser (such as a marketer working for a company) purchase advertising with automated assistance.

Also called programmatic advertising platforms, DSPs let media buying agencies and individual marketers automatically bid on advertising space. Ad formats for DSP advertising can vary. They include out-of-home advertising space (OOH), video ad space, mobile ad space, and search ad space.

Marketers often use their ad spend on demand-side platforms because they automate ad-buying decision-making processes. They use algorithms and targeting options to:

  • Decide how much the marketing firm/marketer should bid for an ad placement 
  • Automatically make the bid so the marketer optimizes their placement in the competition
  • Purchase valuable ad space based on preset parameters and user data to display ads more effectively

The result? The right demand-side platform can make purchasing ads faster, more efficient, and cheaper for marketers.

Demand-side platforms require advertisers to purchase ad space to reach audience segments based on targeting capabilities across many publisher sites or advertising channels. They don’t purchase advertising inventory specifically from first-party publishers.

DSPs represent an evolution of automated advertising purchasing. To be competitive when buying ads, many marketers feel they have to use DSPs to some extent.

How Do DSPs Work?

The exact workings of demand-side platforms can be a bit technical. At their core, advertisers use DSPs to replace manually purchasing advertisements through automation and real-time bidding tools. 

Here’s a basic breakdown of how a DSP works:

  • First, the advertiser chooses and narrows down a target audience, then uploads ads that the advertiser wants to publish.
  • Publishers then make ad inventories (i.e., available advertising space) available on the DSP, which functions somewhat like a marketplace. The DSP usually connects to different digital ad exchanges or supply-side platforms.
  • The platforms that offer an ad impression to the DSP. The DSP makes a decision to bid or skip the impression depending on how relevant the ad space is for its target demographic criteria.
  • The advertiser competes automatically with other advertisers for the impression by placing bids in real time.
  • Then, the DSP purchases a good impression and can display advertisements on the publisher's website.

All of this happens in milliseconds. It even occurs in relative real time — one person visiting a publisher's website might see a completely different ad than someone else depending on factors like their search history or previous purchasing habits.

DSPs can also be used for out-of-home advertisements, like billboards. In this case, the process is essentially the same; the publishers just replace online ad inventories with billboard spot inventories.

What Is a Programmatic Ad?

Programmatic advertising is a complex process that boils down to purchasing and selling ads using software, then contextually publishing ads based on complex marketing algorithms. Most online advertising happens programmatically, but some OOH advertising does as well.

Programmatic advertising can technically be broken down into two types:

  • Real-time bidding, in which advertising takes place in real-time. Advertisers decide who they want to reach with their digital ads and how much they want to spend. They then take part in bidding wars between themselves and other advertisers who want to reach the same target customers.
  • Programmatic direct advertising, which is more similar to traditional bidding. Publishers sell space to display ads to media buyers using programmatic direct deals. Advertisers can then choose whether they want to reserve some of the publishing space for an upcoming ad campaign depending on their target marketing objectives.

In any case, programmatic advertising is required for demand-side platforms and all algorithmically driven ad buying and selling. Programmatic advertising is advantageous primarily because it eliminates human error and allows machines to make purchases or sales much faster than any human sales counterpart.

Why Are Demand-Side Platforms Important?

Demand-side platforms are important because they allow advertisers to consistently secure the best advertising prices for available ad space. In a competitive arena like marketing, every dollar spent matters. To maximize marketing budgets, advertisers must acquire the best ads or ad spaces for their commercials, billboards, pop-ups, and other ads.

DSPs make this much easier and help marketers save money by bidding in real time for the best ad space possible. DSPs can be customized to purchase ad space that is most likely to resonate with specific customers or visitors, to buy ad space up to a certain budget, and so on.

By taking the ad bidding and buying process out of the hands of human operators, DSPs improve efficiency across the board and help organizations save marketing money. Furthermore, DSPs are important for mobile advertisers in particular because they let those advertisers adjust campaign performance standards and metrics in real time.

For example, a mobile advertiser doesn't have to wait for a marketing campaign to end to make changes in terms of budget, target audience, and more. They can adjust their campaigns in real time using a DSP dashboard for immediate positive results.

In a broad sense, demand-side platforms are crucial because they allow advertisers to invest money more effectively into marketing campaigns and get more of a return on those investments. Companies that don’t use DSPs are putting themselves at a disadvantage, especially if many of their ads are online and/or mobile. 

What Is the Difference Between DSP and SSP?

Demand-side platforms are similar to supply-side platforms (SSPs), but they aren’t the same type of service providers. SSPs let publishers connect ad inventories to ad exchanges. They’re the other side of this complex buying and selling process.

Think of SSPs as the platforms publishers use to put their ad space inventory up on the bidding markets. SSPs also allow publishers to filter advertisements based on advertiser types, costs, bidding rates, and other factors. They can also set bidding rates for their ad spaces to help define the costs for specific ads, like billboard ads or pop-up ads.

Both DSPs and SSPs are necessary for this entire process to work. 

Contact AdQuick Today

As you can see, the right demand-side platforms can help you manage your marketing campaigns more efficiently than before. In fact, a useful DSP can let you scoop up both online and out-of-home (OOH) advertisements quickly and cost-effectively.

AdQuick DSP is just the ticket. Our full-service programmatic out-of-home campaign tool allows you to purchase billboard spots as if they were online ads, helping you start, manage, and complete your OOH marketing campaign management tasks easier than ever. Plus, we accept crypto

With self-service and managed service options, AdQuick DSP is the ideal demand-side platform for businesses of any size. Try it today.


What is demand-side platform (DSP)? | Definition from TechTarget

What is a Supply-Side Platform, or SSP? | Digiday 

Disrupting Donald Draper: Programmatic Ad-buying’s Effect on the Advertising Industry - Digital Innovation and Transformation | Harvard 

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