DSP is short form for Demand Side Platform. Demand Side Platforms are web-based tool which helps the advertisers or agency's to buy the ad space from the publisher website. Ex: MediaMath, Turn, DoubleClick Bid Manager etc,.
The end user of the DSP is an Advertiser or Ad Agency that allows the access to the real-time bidding through ad exchange, where the each ad will be served through bidding and the winning ad will serve an impression on the publisher website.
DSP's are enhanced version of the Ad Network because they offer additional features
- Campaign Management
- RTB capability
- Tracking the performance
- Optimizing the campaign performance
- Transparency and control
- Better Reporting
For Example:
AdRoll is an aggregator of Facebook, Web, Yahoo Right Media, AppNexus etc,. An advertiser can target the audience on Facebook, Web, AppNexus by launching a single campaign through AdRoll instead of launching 3 different individual campaigns in Facebook ad manager, Adwords and in AppNexus.
DSP's usually bid on CPM basis and will take a certain of part of the commission from the advertiser spend. In this way DSP's makes money.
To better understand let's take an example of DSP:
AdRoll is an aggregator of Facebook, Web, Yahoo Right Media, AppNexus etc,. An advertiser can target the audience on Facebook, Web, AppNexus by launching a single campaign through AdRoll instead of launching 3 different individual campaigns in Facebook ad manager, Adwords and in AppNexus.
DSP's usually bid on CPM basis and will take a certain of part of the commission from the advertiser spend. In this way DSP's makes money.
To better understand let's take an example of DSP:
- Users or visitors request for a publisher website in the browser and the browser will send a request to web server then web server will send ad tags along with HTML Code. Ad tags will send ad request to the publisher ad server. Along with ad request some additional user information will be sent to Supply Side Platform(SSP). SSP's will send a request to the ad Exchange for further bidding(To understand clearly or to keep diagram simple, the above diagram doesn't contain information about SSP's)
- Along with bid request Ad Exchange will passes user information to the DSP's to bid for the ad slot on the publisher website
- DSP's takes information provided by the Ad Exchange and request DMP's to provide more information about the user, so that DSP can high amount of website visitor
- DMP's process the DSP's request and will send the information User such as Age, Gender and more information about the users
- DSP's will estimate the bid amount based on the relevancy of the advertiser product. If the likelihood of clicking an ad or buying a product is high then DSP's will higher amount to win the bid. On the contrary, DSP's will bid low amount if the likelihood of clicking an ad is low.
- Similar to the DSP's(this DSP) many other DSP's also participates in the Real-Time Bidding
- Winning ad via Real-Time Bidding will be passed as an ad response to the publisher website and ad will be displayed on the publisher website.
Each DSP's have different functionality and works in the different way, but ultimate goal of the DSP's to bid high amount for potential customer using their logic.