Thanks to supply-side and demand-side platforms, buying and selling ads has never been quicker or easier. But it hasn’t always been that way. EZmob remember when you couldn’t publish an ad without complex, drawn-out processes involving middlemen and negotiation. Yawn.
What’s changed? The use of programmatic advertising. Let’s look at how demand-side platforms work and why you should use them.
What is a demand-side platform (DSP)?
A demand-side platform lets advertisers buy ads from publishers on a marketplace. Likewise, supply-side platforms are for publishers to earn money from ads. Video, search, and mobile ads can all be bought and sold on these marketplaces.
Yet the real game-changer is the use of automation, which is why DSPs and SSPs are so efficient and quick. Programmatic advertising allows real-time bidding networks across multiple platforms.
This leads us to the next question
What is programmatic advertising?
Programmatic advertising uses sophisticated algorithms and software to facilitate the sales of ads. This makes it possible for bidding to take place without human intermediaries to complicate the process. Instead, the entire system is automatic.
Two of the most popular types are real-time bidding and programmatic direct.
As the name suggests, real-time bidding means auctions take place with no time lags or delays. Just input your core demographic and budget and bid against others with the same goal.
When a user visits a web page, they’ll see an ad based on various pieces of demographic information while the bidding is happening. Ultimately, the highest bidder wins the ad placement.
Programmatic direct bears more resemblance to traditional advertising sales. The process is direct: advertisers decide where they want to place their ad and make a deal with a publisher. However, the ad placement itself takes place programmatically rather than manually.
Programmatic advertising can also include ad sales on individual networks, but they don’t always involve DSPs.
Regardless, programmatic advertising is here to stay. The market is set to reach 88% of all US digital advertising by 2021, so you can’t afford to ignore it.
How a DSP works
Traditionally, advertisers buy their ads through the publisher that will display the adverts. This isn’t the case with demand-side platforms — they’re completely independent of individual networks like Google or Facebook. Instead, they allow you to work with ads across multiple different platforms with zero hassle.
Everything advertisers need is available on a supply-side platform. By linking supply with demand, programmatic advertising facilitates an ad exchange that is much more convenient for everyone involved.
Publishers list their offerings and pass on metrics like impressions and demographics of the people making the impressions. This helps to determine the value of the ad on the DSP — proven interest of ideal customers is extremely valuable to advertisers.
Best of all, the process happens automatically.
Why use a demand-side platform?
By this point, it should be obvious why using a DSP is helpful. If you still have doubts, keep reading.
Advantages of DSPs
They’re efficient. It’s easy to see why DSPs help with productivity gains. Instead of liaising directly with publishers or using multiple platforms, you can bid and manage everything automatically from one dashboard. It doesn’t get much better than that.
They provide great data. We live in an age of data, and DSPs provide plenty of it. Find out about the location, behavior, and more of your prospects across multiple networks.
Even better, you may be able to import that precious data over to an external customer relationship management platform.
Everything is targeted. Do you know what more data means? More accuracy and targeting for future campaigns. And what does better targeting mean? More conversions! It’s a virtuous circle.
Stellar support. Because DSPs automate almost everything, they can (and generally do) provide better support than individual networks.
High-quality publishers. Having access to multiple networks wouldn’t be much use if none of them were useful. Luckily, that isn’t the case — you can work with multiple premium publishers on DSPs.
Cons of using a DSP
Cost: DSPs can require significant investment, and if you’re not budgeting more than $5,000 per month for ad spend you can probably get all the reach you need from the Google Display Network.
Complexity: Whenever you aggregate data, you run the risk of overcomplicating things. Some advertisers may find demand-side platforms too complex to learn quickly enough to see a benefit.
Assemble your million-dollar campaign
Demand-side platforms aren’t suitable for everyone. They’re expensive, hard to get your head around, and not worth the hassle if you only want to advertise on a few platforms.
But for everyone else, DSPs are an easy decision. If you could skyrocket your productivity and business growth and easily advertise on many platforms, why wouldn’t you?
For anyone who likes the idea and is considering taking the plunge, education is the first step. Check out our free Programmatic Advertising Guide to learn more about how to get the most of a million-dollar advertising spend.