Anna VintsevskaDigital advertising has changed dramatically recently and has become more data-driven. This is where the Demand Side Platform (DSP) plays a key role. DSP advertising helps ad agencies and advertisers effectively manage their campaigns. They can customize bid size (CPM), determine the necessary limit of impressions or clicks, and use pixels for data collection. These and other tools allow you to run ad campaigns with targeting parameters in mind, thereby ensuring more accurate targeting. Below, we delve into the demand-side platform definition, how it works, and its main advantages.
Demand-side platform meaning: an overview of DSP components
These days, with the DSP in advertising, the buying of ads has been simplified. So, what is DSP (demand side platform), and how exactly do they improve the tracking effectiveness?
The definition of demand-side platform
DSP, meaning an automated online advertising buying platform, lets both advertisers and agencies buy and manage digital ad inventory across multiple ad exchanges and online resources in real time. DSP definition also involves software that facilitates the process of purchasing and selling ad space. An advertiser connects to the DSP to buy and place ads online, track results, and optimize their digital advertising across various channels and formats, such as banners, video, and audio ads on online radio and music services, dynamic personalized creatives, native blocks, and retargeting.
The DSP interacts simultaneously with several web services, among which are:
programs that distribute ads - SSPs;
traffic aggregators - Ad Network;
advertising exchanges - Ad Exchange;
data management platforms - DMP;
publishers - owners of advertising platforms.
DSPs are used for broadcasting advertising to the most interested audience while saving labor costs and marketing budget.
The DSP platform is suitable for advertising networks that want to gain full control over the process of buying and optimizing advertising inventory for their clients. Advertising agencies can also get advertising inventory directly, manage ad placements, and set prices and rules for accessing inventory. Nevertheless, DSP allows large brands and advertisers to independently manage their campaigns and optimize engagement with their target audience.
Why are DSPs important?
Today, DSP advertising has simplified the process of closing deals. When purchasing traffic, customers do not need to analyze platforms on their own, negotiate the terms and cost of clicks, or sign contracts. Everything happens automatically. In such a way, advertisers can flexibly optimize campaigns, narrow or expand the target audience, manage the purchase, and promptly control the process. At the same time, impressions can be purchased simultaneously from different sites and owners without the influence of the human factor on the result, thus saving time and money.
How do demand-side platforms work?
Now that we know what is demand-side platform advertising, we can switch to the algorithm of programmatic advertising that consists of 5 stages.
First, the Supply Side Platform receives a signal that a user has visited a web page and sends requests to the Demand Side Platform.
Second, the DSP processes the user information. The system takes user profile data from its database and the DMP with demographic data, behavioral data, and contextual data.
Third, the DSP bids or refuses the auction based on user data and specified targeting.
After, the SSP checks the bids and gives the right to place an ad to the bidder with the highest bid. In this case, the buyer who wins the auction pays the cost of the second-highest bid for the display.
Finally, the ad of the advertiser who won the auction pops up on the page.
Components of a demand-side platform
A typical DSP consists of several key components:
Integrations: A DSP must integrate with various ad exchanges, ad networks, and data management platforms (DMPs) to get ad inventory and audience data.
User Interface: A user-friendly interface allows advertisers to easily create and manage their campaigns, set targeting criteria, and monitor performance.
User Profile Database: This database stores information about the advertiser's target audience, including demographics, interests, and behaviors.
Reporting Database: The DSP collects and stores data on campaign performance, such as impressions, clicks, conversions, and cost per acquisition (CPA).
Banking: The DSP controls financial transactions between the advertiser and the ad exchange.
Campaign Tracker: This component monitors campaign performance in real-time and provides insights into campaign optimization.
Ad Server: The ad server delivers the advertiser's ads to the websites or apps based on the targeting criteria.
Bidder: The bidder is the core component of a DSP, responsible for analyzing available inventory and determining the optimal bid price for each ad impression.
3 key benefits of DSP
Buying advertising traffic through DSP platforms greatly simplifies the processes of media buying. Among the advantages, we can highlight the following:
Reduced money and time spent
DSP in advertising allows you to buy only targeted and high-quality traffic. You can also use an open auction to buy traffic from premium sites cheaply. By integrating into the programmatic ecosystem, advertisers can manage huge volumes of data and reach a wide audience with minimal costs for such volume. Automation on the platform frees up time for more global tasks.
Fast optimization
DSPs display traffic acquisition statistics in real time. The marketer controls the progress of the campaign and can quickly change settings to avoid spending the budget on inefficient traffic sources.
Accurate audience targeting
DSP algorithms work with huge data sets, learn in the process, and accumulate accurate data about users: what interests users have, from which smartphones and browsers they visit the network, what banners they click on, and what they add to the cart. This allows advertisers to target very narrow audience segments.
Explore the possibilities with TeqBlaze’s white-label demand-side platform
TeqBlaze offers a white-label solution that can be customized to meet your specific needs. Our customizable, scalable, and privacy-compliant demand-side platform offers advanced features such as AI-powered keyword expansion, KPI-based price optimization, and auto-optimization tools. The advanced solution emphasizes privacy regulation compliance and offers complete transparency and custom branding options, allowing advertisers to adjust traffic sources based on precise metrics.
One of TeqBlaze's notable success stories showcases a startup that utilized the White-Label SSP & DSP Bundle, which allowed both the buying and selling of ad inventory on a single platform. The startup managed to achieve exponential growth in its user base within a short timeframe, which highlights the effectiveness of TeqBlaze's solutions for businesses of all sizes and programmatic experience levels.
If you want better control over your ad traffic, create multiple ad accounts and additional customizable settings, and spend less money, order our product demo and stay on the cutting edge of digital advertising technology for your future digital success.
