Ad buying and selling hasn’t always been as easy as it is today. Over time, the online advertising market has streamlined and optimized the buying and selling of ad space, consolidating supply and demand on ad exchanges. Now, thanks to supply-side platforms and demand-side platforms, publishers can reach a wider range of advertisers, while advertisers enjoy lower prices and better tools for tracking ad performance.
What is a Demand-Side Platform (DSP)?
A demand-side platform (DSP) is software that's used by advertisers and media-buying agencies to automatically bid, in real-time, on ad inventory offered by publishers. Such inventory includes the full range of online advertising, from various forms of display and video advertising to mobile and search ads.
A fundamental part of programmatic advertising, DSPs streamline the decision-making process by instantly determining how much advertisers should bid for each ad impression. Such automation makes the ad-buying process faster and more cost-effective.
The key advantage of DSPs is that they access specific audience segments—based on sophisticated targeting settings—across numerous publisher sites instead of purchasing ad inventory from publishers themselves
Why Are Demand-Side Platforms Important?
Because demand-side platforms allow for the management of advertising across many real-time bidding networks, advertisers no longer have to manually contact hundreds of publishers with offers to advertise.
Since marketers no longer have to spend time and energy on something that can be completed by an automated machine, they can set up campaigns quickly and manage them with ease.
What is Programmatic Advertising?
Programmatic advertising is the process of automatically buying and selling digital advertising space. It connects publishers with ad inventory to advertisers, offering a smarter, faster alternative to manual digital advertising. Any formats and channels can be accessed programmatically, thanks to programmatic platforms that have built up their ad inventory and database.
In 2023, more than 90% of digital display advertising spending in the US was transacted through programmatic technology . Most online advertising now is done programmatically through real-time bidding and direct deals.
How Does a Demand-Side Platform (DSP) Work?
Demand-side platforms are used by advertisers to replace manual ad buying with an automated, real-time bidding platform. The whole process can be summarized in the following steps:
- The advertiser selects their target audience and uploads the ads they want 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 a decision to send a bid to buy the impression based on relevance to the targeting criteria.
- The advertiser competes with other advertisers for the ad impression placing bids in real-time.
- The demand-side platform buys the impression and the ad is shown on the publisher’s website.
This whole process is conducted 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 the advertiser and other criteria, as well as set different rates for ad spaces to define the cost.
DSP refers to the demand-side platform. It allows the buyers of digital ad inventories to manage multiple ad exchanges via one interface.
The buyers commonly include trading desks, agencies, or advertisers directly. The demand-side platform must plug into an SSP to enable the buyer to bid on digital inventory.
Simply put, a DSP and an SSP connect to different parts of the programmatic ecosystem. A demand-side platform is a tool used by advertisers to help organize ad-buying, whereas a supply-side platform is used by publishers to automate the sale of advertising space, which is the supply-side of the demand-side platform.
What Are the Main Components of a DSP?
Although different companies may have different elements or different names, they all share a similar structure to fulfil their role of serving ads programmatically.
Let’s take a closer look at the components that make up many of today’s DSPs.
Bidder
The bidder is the most important element of the DSP, as it’s what places bids on ad impressions on a real-time bidding (RTB) process. As the RTB process concludes in milliseconds, being able to execute the bid as fast as possible is crucial. Most DSPs use multiple data centres spread around the world to minimise latency. Demand-side platforms use analytics to forecast impression bids based on historical information.
Ad server
The ad server of the DSPs is what actually serves the required ad elements to the publisher’s website. But they do much more than that. Ad servers also track the impression and conversion data, which can then be used to optimize the ad campaign. They also have fraud prevention functionality, to detect false ad inventory. A demand-side platform can have its own ad server or integrate with an external one.
Campaign tracker and reporting
A key element of a DSP is the ability to track and record data about the ad effectiveness: impressions, ad viewability, clicks, CTR, conversions, ad spends etc. This is then presented on a reporting dashboard and used in the ad campaign optimization.
User profiling
DSPs record user data when they view an ad served by the DSP. Over time, they build a profile of the user, allowing them to assign them certain characteristics and place them in an audience segment, based on the type of content they are consuming, where, and which ads they are clicking on. The user profile database is used in remarketing campaigns and ad optimization.
Budget manager
This element can be known in DSPs as the banker or the cashier. It’s what allows the advertiser to define the budget parameters of the campaign, like defining a maximum budget for the campaign. The budget manager can also define rules about how the budget is spent.
Integrations
DSPs integrate with ad exchanges and SSPs for advertising space, but they also integrate with other tools to increase their functionality, like data management platforms, analytics platforms, payment gateways and brand safety solutions, which enhance the 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 several supply sources allows a demand-side platform to consolidate and centralize the ad-buying process, allowing an advertiser to have a wide cross-channel reach from a single source. Therefore an advertiser would expect their DSP to integrate with several ad exchanges and SSP.
What Are the Types of Demand-Side Platforms?
There are two types of DSPs: self-serve and full-service DSPs.
Self-serve DSPS
A self-serve DSP is just a platform an advertiser can use to buy advertising. Campaign ideation, execution and reporting are performed by the advertiser’s team or their agency.
Full-service DSPs
A full-service DSP behaves more like an agency. They provide additional service through an account manager. An external team in the DSP takes control and responsibility of the ad campaign from start to finish. It’s more expensive and the advertiser has less control and flexibility over the campaign execution, but it’s more convenient for advertisers.
How Do DSPs Help Advertisers Buy Ad Space More Efficiently?
Advertisers and media buyers enjoy several advantages by using DSPs to execute their advertising campaigns over manually buying advertising space.
Advantages of using a DSP
1. Automated, real-time bidding
First, RTB streamlines and automates the negotiation process between media buyers and sellers. The whole process of analysing the ad impression offered and bidding on that impression, taking into account budget, value and target, is performed in milliseconds while the user is loading the page.
2. Inventory reach and selection
Another key advantage is the consolidation of supply in one single platform. Using a DSP allows advertisers to reach a wide range of publishers from one single provider, a more diverse and global ad inventory than they can do on their own. This inventory is often classified by different characteristics which allow a brand to choose carefully where they want their ads placed. This is important for brands which place a premium on being able to choose a safe placement for their advertising.
3. User targeting
All the data that the DSP captures about user behavior is used to improve the targeting, optimize the ad rotation and provide remarketing capabilities. Having a strong user targeting functionality ensures advertisers they can reach the users they need across any digital properties they visit.
4. Reporting, analytics, and optimization
Advertisers value the ability that DSPs provide to see the performance of their ad campaigns in a consolidated dashboard. This gives advertisers and agencies more information to act and optimize their campaigns to be more relevant and provide more value to their target audience.
What Kind of User Data Do DSPs Employ for Targeting and Bidding?
Demand-side platforms have access to multiple sources of user data they can use to build their targeting strategies and optimize their bidding.
First, they have their own data collected from ad impressions and ad clicks, like ad spend, CTR, CPC or ROI. This campaign performance information is complemented with other sources:
- User data imported by advertisers from their own CRM. Advertisers can use their own data to create specific targets for remarketing campaigns or to build lookalike audiences based on their customers’ profile.
- Publishers can also provide information about the content where the ad impression sits and about the user that triggered the ad impression. This data includes demographic information about the user, including their location and type of device they use. It can also include behavioral information, like browsing and shopping history.
- DSPs also purchase information from third-party data brokers and exchanges that can be used to build custom audience segments based on the criteria specified by the advertiser.
Top Demand Side Platforms
With a multitude of DSPs on the market, it can be hard to find one that has exactly what your business needs. To save you time, we've brought together five DSPs that have consistently performed well for advertisers across a spectrum of industries.
Read on to learn which one might be right for you.
The Trade Desk
For advertisers whose priority is reach, precision, and transparency, The Trade Desk is their platform of choice.
This DSP connects you with premium inventory across a broad range of ad exchanges and SSPs, including connected TV (CTV), audio, and digital out-of-home (DOOH) ads. Such inventory doesn't just come from its own media properties, which allows the platform to objectively buy and optimize ad space.
Why Advertisers Choose It
The Trade Desk offers advertisers a wide range of functions and specific tools that allow them to scale their ad campaigns without compromising their accuracy.
Omnichannel Advertising
An inventory that spans all digital ad formats and channels, from standard display and video ads to tailored native ads and CTV ads.
Advanced Targeting
Advertisers can tailor their campaigns to the interests of specific audiences, based on detailed demographics and other data.
User-friendly Platform
Other advanced DSPs, for all their sophisticated functions, burden new users with a steep learning curve. In contrast, The Trade Desk's intuitive interface allows advertisers to quickly make the most of its features, saving them precious time and other resources.
Integration Options
The platform provides enterprise APIs for advanced integrations with other marketing tools.
Centralized Measurement
No matter how many campaigns you're running, or the changes you need to make with any of them, The Trade Desk allows you to do so easily from one place, affording you the comprehensive analytics you need to optimize your ads.
Flexibility
The online ad world is constantly changing. The Trade Desk's privacy-conscious solution, UID2, which allows advertisers to target audiences in a landscape without third-party cookies, is just one example of how this DSP can adapt, when needed.
Use Case
The FMCG giant Kraft Heinz wanted to expand its presence in the Philippines. Using The Trade Desk, it implemented a full-funnel campaign that included display, DOOH and over-the-top (OTT) ads.
The campaign resulted in a 4.7 cheaper cost per reach, a 65% higher click-through rate (CTR) and a 48% year-on-year share of voice jump for ketchup products.
Consider Before Choosing
If your team isn’t prepared for advanced targeting or cross-channel strategy, this DSP’s complexity may be a little overwhelming. Its power is fully harnessed when you have clear goals and experienced staff.
Google Display & Video 360
Google Display & Video 360 (DV360) is Google’s flagship DSP. Built for high-performance media teams, this platform enables unified planning and buying across YouTube, CTV, display, audio, and native ad formats.
Apart from its media buying function, DV360 integrates directly with GA4, Campaign Manager 360, and Search Ads 360, making it a key hub in Google’s marketing ecosystem
Why Advertisers Choose It
Given Google's status as the online gateway for many consumers, DV360 offers a number of key benefits.
Cross-channel Advertising
DV360 offers advertisers various ad formats and channels, from a broad range of display and video ads on CTV to carefully crafted native ads, among others.
Inventory Access
The platform's vast pool of ad inventories includes premium placements, as well as private marketplaces.
Advanced Targeting
DV360's offer of various formats and channels, coupled with its access to impressive inventories, allows advertisers to pinpoint their ads on specific audiences, based on key demographic and psychographic data.
Harnessing of Artificial Intelligence
Thanks to Google's formidable machine learning and other artificial intelligence (AI) resources, DV360's automization and optimization of bidding, campaign management and other tasks allows advertisers to maximize their ads' efficiency.
Brand Safety
A brand's reputation can be ruined in an instant if it's promoted alongside inappropriate content – a common occurrence online. DV360 allows advertisers to avoid this by providing tools that control ad placements.
Use Case
Adidas decided to use DV360 to relaunch its 'Ready for Change' campaign at a time when the performance of CTV ads was at an all-time high.
With programmatic deals and a rapid campaign set-up, the company managed to reach over 24 million viewers on the Hulu, Roku and ESPN channels. During the campaign, Adidas carefully controlled the frequency of the ads, focused its spending on the top 37.5% of relevant impressions and reinvested their savings into extended reach.
Consider Before Choosing
If you don’t already use an advanced data system – such as GA4 or a customer data platform (CDP) – you may struggle to unlock DV360’s full potential. Moreover, without proper integration, the platform’s benefits can feel limited, turning it into more of a closed system than a strategic advantage.
Amazon DSP
Amazon DSP's inventory encompasses Amazon’s own properties, as well as third-party inventory, with targeting based on what people actually buy. Because of this, it offers advertisers direct access to audiences whose purchasing behavior is grounded in up-to-date actionable data.
Why Advertisers Choose It
For businesses that already market on Amazon – or those looking to benefit from such a presence – Amazon DSP delivers substantial rewards.
Advanced Targeting
As an online giant, Amazon’s audience data is unmatched. Advertisers can segment their ads not just according to standard demographic and psychographic data, but also to data such as purchase history, product views, and lifestyle categories. Few other platforms can match such granular precision.
Campaign Optimization
Amazon DSP's use of such detailed, up-to-date data affords advertisers with data-driven insights that can be critical to the ultimate success of ad campaigns, including moments when changes have to be made to a given campaign.
Simplified Campaign Management
When you have to make quick decisions, the last thing you need is complexity. Amazon DSP centralizes all aspects of campaign management, simplifying your schedule and overall ad management.
Brand Safety
Like other good DSPs, Amazon DSP takes brand safety seriously. Its brand-safe inventory and ad placement controls ensure that advertisers' reputations are protected.
Use Case
Sika, a global B2B chemical brand, wished to establish itself in Spain's DYI market. Using Amazon DSP, the company implemented a full-funnel video ad campaign, targeting its audience from awareness to conversion.
The campaign produced a 62% video completion rate, a 9% increase in purchase intent and a 20% year-over-year increase in branded search volume.
Consider Before Choosing
If you’re not already selling on Amazon and can’t commit to a $35K+ monthly managed service, this DSP may not be the best option. Self-service is an alternative option, but the real value comes when you’re fully integrated into Amazon’s broader ecosystem.
StackAdapt
Developed for advertisers who value precision, agility and a clear ROAS, StackAdapt consolidates everything into a streamlined, self-service DSP.
With its comprehensive coverage of different channels – including display, video and CTV ads, as well as DOOH ads – and campaign management, the platform allows advertisers to target, place, and bid directly for faster, more accountable outcomes.
Why Advertisers Choose It
From contextual AI and ABM tools to various native ad formats and pixel tracking, the platform offers a range of benefits in one convenient spot.
Advanced Targeting
Thanks to its integration with data providers such as Acxiom and Bombora, StackAdapt can help advertisers target audiences at a granular level, such as a typical audience member's location, industry, job title and job function.
Whitelisting
To enhance security and simplify campaign management, the platform offers advertisers the option of whitelisting specific websites for ad placements.
AI Integration
StackAdapt's use of machine learning and other AI across channels optimizes ad performance and simplifies campaign management.
Proven Track Record
For several consecutive years, StackAdapt has been voted the best DSP by G2, a major software marketplace and review platform.
Use Case
Popeyes, a US-based fast food restaurant chain, wanted to expand in the UK market. Through StackAdapt, the company used the Page Context AI technique, in which algorithms target audiences based on the online content they're viewing at any given point in time.
The campaign's highlights included a 607% ROAS and 22 million impressions.
Consider Before Choosing
If you need hands-on support or a managed service, StackAdapt may not be the best option, as it's been developed for teams that can comfortably manage entire campaigns on their own.
Adobe Advertising Cloud
The Adobe Advertising Cloud DSP offers advertisers a centralized platform for all their campaign needs.
Its key features include all aspects of campaign management, ad performance optimization and cross-channel measurement, which covers display, video and CTV ads.
Why Advertisers Choose It
Apart from its analytics tools for tracking campaign performance and optimizing ROI, one of the key drawcards for Adobe's DSP is its integration options with Adobe Experience Cloud Solutions. This allows advertisers to leverage their first-party data for better targeting and ad personalisation.
Here are some other benefits.
Sophisticated Targeting
Along with its use of standard demographic and psychographic data, Adobe's DSP also employs other, more sophisticated, audience targeting methods, such as retargeting, prospecting and look-alike modelling, as well as dynamic creative optimization, in which ad content is created and personalized in real-time.
Unified Ad Platform
The platform's integration of media planning tools and cross-channel buying functions brings all of the key aspects of ad campaign management into one convenient place.
Improved ROAS and Reduced CPA
Thanks to its sophisticated audience targeting, Adobe's DSP can help advertisers increase their ROAS and lower their cost per acquisition (CPA).
Use Case
Japan Airlines wanted to bring together campaigns it had already begun across south-east Asia. Using Adobe's DSP, the airline was able to consolidate its creative content, audiences and spending.
The campaign's outcome was an 81% drop in CPC, a two-fold increase in CTR and a $32,000 saving in overlapping impressions.
Consider Before Choosing
While a boon for advertisers who are already long-term Adobe users, this DSP may demand some extra effort from advertisers who are new to the Adobe landscape.
What’s the Difference Between Ad Networks and Demand-Side Platforms?
Ad networks and demand-side platforms are quite similar. They provide basically the same services around programmatic advertising, but DSPs incorporate more advanced features regarding real-time bidding and audience targeting, which in ad networks is restricted to a set of predefined audience segments, instead of the custom targeting criteria of DSPs.
These platforms are an evolution of ad networks. And the line between the two is blurring since ad networks are incorporating many of the features that set DSPs apart in the first place.
Demand-Side Platforms Are a Key Player in the Online Advertising Ecosystem
DSPs have disrupted and introduced key innovations in a process that was regarded as inefficient, due to the necessary negotiations and back-and-forth between media buyers or advertisers and publishers.
The consolidation of supply in a single platform that automates the ad buying process through real-time bidding brings transparency, accountability and enhances the ability of advertisers to reach their target audience through a wider range of publisher sites.
If you’re making more than $2,000 in monthly ad revenue, contact us today to learn more about how Publift can help increase your ad revenue and best optimize the ad space available on your website or app.
Demand Side Platform FAQs
1. What Two Data Services are Typically Part Of the Demand Side?
A DSP has two types of data services—physical and logical. Physical is fully based on metadata imported from the client’s underlying sources. Logical is partially or wholly based on other data services.
2. How to Create a Demand Side Platform?
There are three major processes needed to create a DSP. Firstly, a CPM bid algorithm needs to be created. Then there needs to be a single-point management system to oversee connections across various sources (such as advertisers and exchanges). Then a targeting/retargeting system needs to be created for accurate ad delivery.
3. What is a Mobile DSP?
A Mobile DSP works much the same way a regular DSP would, except that it’s specifically used for purchasing mobile ad space.
4. How to Find the Best Demand Partners?
Finding the best demand partners may require a bit of research such as seeing other publishers’ reviews. However, the best demand partners respect the audience experience: they won't display interruptive or offensive ads.
5. Is Google a Demand Side Platform?
Google Display and Google Video 360 are DSPs.
6. Is Facebook a Demand Side Platform?
Meta’s Ad Manager is a DSP.