Glossary
Demand-side platform (DSP)
Demand-side platform (DSP)
A demand-side platform (DSP) is a software platform that enables advertisers to buy and manage ad inventory in real-time bidding auctions.

What is a demand-side platform?

A demand-side platform (DSP) is a software platform that enables advertisers to buy ad inventory from various ad exchanges and supply-side platforms (SSPs) in real-time bidding (RTB) auctions. DSPs allow advertisers to bid on specific audiences and placements and to set up, manage, and optimize ad campaigns across multiple ad exchanges and SSPs. DSPs also provide various tools and features to help advertisers target and personalize their ad campaigns, such as data management platforms (DMPs) for collecting and organizing data on audiences and algorithms for automated decision-making and optimization. Advertisers and agencies use DSPs to reach specific audiences across various digital channels, including display, video, mobile, and social media.

How does demand-side platforms work?

DSPs use machine learning algorithms to connect advertisers with available ad inventory from various ad exchanges and SSPs. When a publisher makes ad inventory available for purchase, the SSP sends the inventory to ad exchanges, where it can be accessed by DSPs. The DSP then uses data and algorithms to determine which ads to bid on and how much to bid on, based on the specific targeting criteria and objectives set by the advertiser.

Once a DSP has won an auction, the ad is served to the targeted audience on the publisher's website or app. The DSP tracks the ad's performance and provides analytics and reporting to the advertiser on the campaign's results.

What are the benefits of using a demand-side platform?

  • Efficiency: DSPs allow advertisers to bid on ad inventory in real-time, which means they can reach the right audiences at the right times with the right messages. This can help increase ad campaigns' efficiency and maximize ROI.
  • Targeting: DSPs offer advertisers a wide range of targeting options to create the targeting criteria that match their needs. Traditional ad networks only provided limited audience targeting features to advertisers. Therefore, using DSPs can help increase the reach and effectiveness of ad campaigns, as advertisers can target specific audiences and placements that are most relevant to their business objectives.
  • Automation: Many DSPs offer features such as automated decision-making and optimization algorithms, which can help to streamline the ad campaign process and improve results.
  • Scale: DSPs give advertisers access to a wide range of ad inventory from various ad exchanges and supply-side platforms (SSPs), which can help increase ad campaigns' reach and scale.
  • Integration: DSPs can be integrated with data management platforms (DMPs) and other marketing tools, which can help to improve the targeting and personalization of ad campaigns.

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