It’s hard to believe it’s been over a decade since I first sat down, skeptically, at a lunch and learn with RocketFuel, one of the first ad tech heavyweights, to learn about this thing called programmatic digital advertising. Promising to serve the right ad in the right space at the right time to the right user (in milliseconds, at that), RocketFuel (and MediaMath, the other key demand-side platform (DSP) at the time) offered AI-fueled real-time bidding capabilities that showed a new, more efficient and highly effective data-driven way to buy digital advertising at scale. A lot has changed in the 10+ years since our first meeting with RocketFuel, and now there are hundreds, if not thousands, of DSPs that can help you accomplish the same thing. The question is no longer “Should I be purchasing media programmatically,” but rather, “Which DSP is right for this client, brand or product?”
In this edition of Plain Talk, we’ll cover:
- What is a demand-side platform
- A brief history of demand-side platforms
- ABCs of choosing a DSP
- Our take on some of the main DSPs we come across
What is a DSP
Simply put, a demand-side platform is an ad tech software that allows advertisers to purchase advertising using automation and big data to make real-time bidding decisions at scale. Advertisers can buy digital impressions across multiple publishers through an ad exchange, and the DSP decides automatically, based on the factors and goals entered at the campaign start, which spaces make the most sense for a specific advertiser to buy. There is no human-to-human negotiation on price or space; the price is determined by a real-time auction based on the real-time bids set by the computer program. The key difference between DSPs and previous ad networks was the ability to make these decisions at scale in real time and eliminate the human element of the back-and-forth price and placement negotiations. Rather than determining ahead of time which ad network you would run with, DSPs allowed you to target your audience and then decide in real time if you wanted to advertise in a space where your audience was found. It was much more about the targeting than the placement.
A Brief History of DSPs
Demand-side platforms have evolved significantly since their inception. Here’s a rough chronological overview:
1. Early 2000s: The concept of DSPs began to emerge as online advertising expanded. Advertisers and agencies sought more efficient ways to buy digital ads across various publishers and ad networks.
2. Mid-2000s: The first generation of DSPs appeared, offering rudimentary targeting and optimization capabilities. These platforms mainly focused on display advertising.
3. Late 2000s: DSPs started to gain traction as more advertisers recognized their value in automating ad buying and improving targeting. Real-time bidding (RTB) technology became a key feature, allowing advertisers to bid on ad impressions in real time based on user data.
4. Early 2010s: DSPs continued to evolve, incorporating more sophisticated algorithms for targeting and optimization. They expanded beyond display advertising to include other ad formats like video, mobile, and native ads. Integration with data management platforms (became common, allowing advertisers to leverage first-party and third-party data for targeting.
5. Mid-2010s: Programmatic advertising became mainstream, and DSPs played a central role in facilitating programmatic ad buying. The ecosystem grew more complex with the rise of header bidding and the introduction of supply-side platforms (SSPs) and ad exchanges.
6. Late 2010s to early 2020s: Consolidation occurred in the DSP market as larger players acquired smaller platforms to strengthen their offerings. DSPs started to focus more on transparency, brand safety, and ad fraud prevention to address industry concerns.
7. 2020s: DSPs continued to innovate, incorporating advanced technologies like machine learning and artificial intelligence for better targeting and optimization. Cross-channel capabilities became increasingly important as advertisers sought to reach consumers across various devices and platforms.
Throughout this timeline, the evolution of DSPs has been driven by advancements in technology, changes in consumer behavior, and shifts in the advertising landscape.
ABCs of Choosing a DSP
There are hundreds of DSPs out there, and for someone who doesn’t spend all day talking to ad tech providers, it can feel a bit daunting. Programmatic ad spend is set to grow nearly 16% (eMarketer) from 2023 to 2024 and is estimated to make up 80-90% of all digital ad spend. There are over 163 DSPs listed on G2, and there are probably even more trying to make it into the space. Where do you begin?
Demand-side platforms essentially all do the same thing, but you can boil it down to three main components.
1. Inventory Quality and Availability – Where your ads run matters. Not only are there hundreds of more demand-side platforms available, but there are also thousands of ad inventory options (websites and platforms) where you can run your ad. Available advertising inventory is one of the main differences between DSPs and can be the difference between success and failure. Making sure inventory is reputable and credible, that audiences are engaged on these platforms, sites or publishers, and that traffic is free of bots/fake traffic, etc., is key. The ability to create custom private marketplace deals or tap into very specific high-quality supply inventory is key. Also, make sure that the DSP you choose has access to a variety of formats, whether mobile, video, audio, etc. You may not need all formats for a specific campaign, but you also don’t want to use three DSPs when one will do for video ads, mobile ads and CTV (as an example).
2. Targeting Capabilities – The DSP, RocketFuel, was aptly named because of the “big data” that it used to inform (or fuel, get it?) their advertising decisions. Targeting and data are the cornerstones of effective programmatic advertising, and evaluating the data and targeting capabilities can set one DSP apart from another. The entire point of programmatic advertising is to get in front of the right target audience at the right time and place. The right DSP will have data sources that fit your needs, whether you have first-party data that can be leveraged or need to secure 2nd or 3rd-party data. You also want to be able to refine your audience based on demographics, behaviors, interests, locations, devices, etc. In addition, retargeting capabilities are key, and these will change as the cookie continues to crumble in 2024. Working with DSPs developing solutions for audience targeting (or retargeting) will be even more important in the future.
3. Reporting and Tracking/Analytics – One of the key benefits of running a programmatic ad campaign through a DSP is the ability to leverage hundreds and thousands of placements at scale in real time. The DSP serves as a single point of entry and, as a result, should offer greater tracking capabilities across sites, publishers and placements. With the elimination of cookies this year, it’s even more important to partner with a DSP who is making efforts and progress toward cookie-less targeting and attribution in a privacy-compliant way. They should be able to report on all of the basic vanity metrics and provide greater visibility to attribution, viewability, engagement, etc.
Other Factors to Consider – (Yes … we know this technically makes a 4th point) While the above 3 points are the key differentiators, things like customer service and support, brand safety efforts, bid strategy, etc., should all be discussed. Ease of campaign management and self-serve capabilities may also be important depending on your team model. If a DSP doesn’t have the right tools for your brand, it doesn’t mean you should settle – it means you should keep looking, as all DSPs can offer something a little different.
The Main DSPs We Come Across
The key takeaway is that there are hundreds of options for your programmatic advertising, but not all DSPs are created equal, and there are several DSPs that may fit your needs. At PriceWeber, we have experience with multiple DSPs (with five used in-house and several other partnerships available as needed), and our clients navigate to find the best fit and ultimately the best results. Here are a few DSPs we think may be worth investigating based on our experience with our client’s campaign performance.
Google, Amazon and The Trade Desk (TTD)
Google, Amazon and The Trade Desk are the largest and most well-known omnichannel DSPs. They are powerhouses in size, scale and capabilities. There isn’t much you can’t do with one of these DSPs, but bigger doesn’t always mean better. Sometimes, it means less control and more expensive fees, which add to your bottom line. However, if it drives results, that’s really all that matters, and with their omnichannel approach The Trade Desk can likely accomplish the personalization and segmentation needed… it just may come at a higher price tag. Google and Amazon DSPs offer similar large-scale solutions, but the difference between those and The Trade Desk will come down to inventory – both Google and Amazon have owned inventory that will take priority, whereas The Trade Desk is more neutral.
Simpli.fi
Simpli.fi is known for its hyper-local focus. If dealer requirements or store location-specific promotions require a custom and local approach, Simpli.fi may be a better fit. Its secret sauce comes from its unstructured data, which allows for customized bidding for local advertising. They also place a greater emphasis on intent data (based on keywords or previously visited sites) and addressable data that pulls in data like voter status, number of children, interests, etc.
StackAdapt
Falling in a similar space as Simpli.fi and other mid-to-small level DSPs, StackAdapt has provided great performance for a number of our clients. The thing we love most about StackAdapt is to serve highly relevant ads in highly relevant spaces by looking at browsing history, not just search history. This allows us to align messaging not only to the right person, but in the right space. Their platform may be a bit skinnier than some DSPs, but it’s easy to use and a great tool for contextual targeting across multiple placements and inventory types.
Basis
A third mid-level DSP, Basis, has access to all channels through its programmatic and private marketplace deal options. The key is in the setup – this DSP can be used for simple executions but can be more difficult to execute more complicated and segmented campaigns. They have access to a variety of audience segments, making them a good “one-stop shop” for multiple industries. Private marketplace (PMP) deals can be especially useful for B2B clients as you can select and create your own partnerships in the platform. Because you can place across a variety of media types, including through publishers that are not always available programmatically (through direct deals), you are able to do what you need and report at scale and efficiency.
IQM and Other Industry Specific DSPs
Some DSPs know what they can do best, and they stick to it. While IQM and others in this space have the capabilities to run any type of campaign across any available inventory, where these special DSPs shine is in their ability to leverage specific placements and targeting data to specific audiences. IQM has data-rich segments to help with financial and political targeting, whereas AdDaptive is an ad tech provider that primarily focuses on B2B intelligence data to reach B2B targeting effectively.
And more…
There are hundreds of DSPs out there, and at least 30 that claim to be omnichannel DSPs. Our agency is media neutral in that while we have partnerships across the board, no client is stuck with our “typical agency advertising solution.” An agency working in its clients’ best interest should partner with several DSPs/marketing platforms and never shy away from developing new relationships that are advantageous for their clients. Working with clients to understand exactly what needs to be accomplished is crucial in recommending the best DSP for their needs. Ultimately, driving conversions (however those look for your business) should be the final deciding factor, but you should never stop looking for a better solution, as the DSP market is extremely dynamic.
Want to nerd out about DSPs on the market or discuss your upcoming digital advertising? Call us at 502.499.4209 or contact us online.
