January 21, 2021
The digital advertising supply chain is an immensely complicated, ever-evolving web of relationships between publishers, advertisers, networks, ad exchanges, MMPs, and other tech companies. For newcomers, entering the space can be overwhelming without the right partners and resources at your disposal. Thankfully, advertisers and publishers can use a DSP or SSP to manage inventory at scale across this global marketplace.
This article will introduce demand-side platforms (DSPs) and supply-side platforms (SSPs), explore how they fit into the advertising supply chain, and discuss how they differ from platforms like mobile ad networks.
Need a primer on the real-time bidding ecosystem? Check out Mobile RTB: The App Marketer's Guide to the Real-Time Bidding Ecosystem.
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DSPs and SSPs are crucial components of the real-time bidding processes driving modern programmatic advertising. These software platforms let advertisers and publishers interact with Real Time Bidding (RTB) ecosystems while maintaining a high degree of control over inventory.
A demand-side platform, or DSP, is a platform that lets advertisers and media buyers purchase and manage ad inventory. Most DSPs are owned by advertising agencies and technology companies acting as intermediaries for brands looking to promote their products through digital channels.
The modern advertising supply chain is highly complex, with any number of networks, exchanges, and programmatic platforms buying and selling inventory at every moment. Demand-side platforms let advertisers interact with the supply chain through a single interface, streamlining the process while granting more control over ad creative. DSPs often include optimization tools that advertisers use to enhance their ad performance, maximizing user acquisitions and return on ad spend.
A supply-side platform, or SSP, operates on the opposite end of the advertising supply chain. These products let publishers and digital media owners manage and sell ad inventory. In the mobile space, SSPs commonly let publishers monetize free-to-download apps with advertising creative.
Much like how a DSP unifies supply chain management for advertisers, an SSP interface helps publishers manage their inventory. Perhaps more importantly, SSPs give publishers more opportunities for filling their available inventory using real-time bidding auctions. These programmatic channels let advertisers competitively bid for the most valuable impressions, ultimately maximizing revenue for publishers. Many SSPs also let publishers fill ad inventory directly if they so choose.
DSPs and SSPs can allow publishers and advertisers to manage inventory deals directly, but they are individual nodes on a larger supply chain. Other companies and platforms act as intermediaries to ensure a fair and competitive programmatic environment. While publishers and advertisers rarely interact with these platforms outside of real-time bidding, they play an essential role in the supply chain.
Mobile ad networks act as intermediaries for publishers and advertisers during the ad buying process. Most networks accomplish this by incorporating a software development kit (SDK) into app code that will deploy advertisements upon request. Traditionally, ad networks are not programmatic — they are often organized by publishers into a waterfall structure that prioritizes impressions for different networks based on historical eCPMs. These processes are changing as more networks step into the real-time bidding ecosystem through hybrid models.
Ad exchanges are online marketplaces where supply and demand partners can buy or sell ad inventory. DSPs and SSPs manage deals through exchanges programmatically, often resolving bids within a fraction of a second. Outside of a real-time bidding environment, exchanges also act as a platform for publishers and advertisers to manage inventory directly if they so choose.
A data management platform, or DMP, is a warehouse for storing ad campaigns or user data. Both advertisers and publishers use DMPs to achieve their respective goals during the RTB process. When a user triggers an ad placement, the publisher DMP references user information such as the audience segment, social data, purchasing records, and other data relevant for targeting. Once the RTB auction successfully concludes, an advertiser DMP will deploy ad creative that is relevant to the specific user. DMPs can also aggregate and normalize data sets for campaign analysis and performance reporting.
Advertisers and publishers must remember that not all DSPs and SSPs manage access for the same types of ad inventory. When searching for a platform, be sure to consider which ones support mobile devices and desktops, in-app and mobile web, or the overall global reach.
Formats can be a factor here for advertisers as well. While most platforms will handle static images, not all will handle formats that resonate with your target audience. If you need video, rich media, full-screen interstitials, or native ads, be sure the DSP or SSP supports these features.
For ad impressions to reach the right users, advertisers need to know their platform will effectively target their audience. Find out how a DSP obtains user data — particularly whether it is first or third-party. Make sure to consider the specific identifiers available, such as device type, operating system, and geographic location, among others.
When first starting with a DSP, it’s usually a good idea to open your creative to as many publishers as possible. Following this practice lets you scale up as quickly as possible while creating enough performance data for optimizing your campaigns. Even if your initial impressions don’t lead to conversions, the process has benefits in the long-term.
DSPs and SSPs primarily operate through automatic processes, which poses risks. The ideal platform should have measures to address and counter ad fraud before ad spend is lost. Advertisers and publishers also need to keep contextual brand safety in mind, such as whether deployed ads or host apps are brand safe. Support for blacklists and whitelists are a must to address such concerns.
Finally, don’t overlook data privacy. With so many parties involved in the supply chain, user data can be compromised. Investigate what policies and practices DSPs and SSPs have in place to deal with these eventualities.
Choosing the right platform makes a huge difference to advertisers and publishers, and we want to ensure you make the right one. The Moloco platform uses proprietary machine learning technology to drive user acquisition, mobile retargeting, and programmatic advertising campaigns that maximize your ROI.
Moloco's successful track record speaks for itself: Our partnerships with leading ad exchanges help marketers reach over 90% of all mobile devices worldwide. Our DSP is rated among the Top 10 by Appsflyer’s Performance Index, including the #1 DSP in the North American growth chart. If you’re ready to stake your claim in the mobile advertising supply chain, get in touch with us today.
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