A demand-side platform (DSP) is a concept that combines various
software
Software consists of computer programs that instruct the Execution (computing), execution of a computer. Software also includes design documents and specifications.
The history of software is closely tied to the development of digital comput ...
for advertisers (or
advertising agencies
An advertising agency, often referred to as a creative agency or an ad agency, is a business dedicated to creating, planning, and handling advertising and sometimes other forms of promotion and marketing for its clients. An ad agency is generall ...
) to automate the process of buying and selling
ad impressions in real time.
This platform provides digital
advertising inventory with a dashboard, where the advertiser can manage their campaign by defining the
target audience
The target audience is the intended audience or readership of a publication, advertisement, or other message catered specifically to the previously intended audience. In marketing and advertising, the target audience is a particular group of cons ...
, bid amount, overall budgets, ad format, and other parameters, while getting
feedback
Feedback occurs when outputs of a system are routed back as inputs as part of a chain of cause and effect that forms a circuit or loop. The system can then be said to ''feed back'' into itself. The notion of cause-and-effect has to be handle ...
about ad impressions and audience behavior.
Much like
paid search, using DSPs allows users to optimize based on set
key performance indicators
A performance indicator or key performance indicator (KPI) is a type of performance measurement. KPIs evaluate the success of an organization or of a particular activity (such as projects, programs, products and other initiatives) in which it e ...
such as
effective cost per click (eCPC) and
effective cost per action (eCPA).
There are 2 types of DSPs:
* Full-service is a hands-off management model from the agency-side, in which the planning, launch and optimization of an advertising campaign is carried out by account managers of the DSP platform.
* Self-service, in contrast, is like full-service but the management is carried out by the agency or advertiser themselves to allow more control and autonomy rather than let the account managers of the DSP manage the campaign.
Properties of the DSP
DSP has absorbed the features of the
real-time bidding of the previous generation and has brought a lot of new things to the advertising industry:
* Extremely high speed of operation — DSP allows agencies and advertisers to make transactions in real time;
* Wide
audience targeting opportunities: ''direct'' (or ''vertical'') ''targeting'' — by socio-demographic, geographical, temporal, behavioral characteristics, interests, etc. and ''lateral targeting'', which identifies target groups for a specific task with dynamically changing criteria during an advertising campaign;
* Formation of detailed reports on each display, reflecting all the sites involved and the results of their work;
* Realtime statistics: the campaign progress report is reflected with a delay of only a few seconds, which allows you to quickly reduce the cost of inefficient traffic sources;
* Interaction with dozens of
SSPs offering for sale advertising inventory of networks and independent platforms, which means unprecedented
media coverage;
* The ability to optimize the DSP budget, including automatically. This is especially interesting in the case of buying up "residual traffic".
All these features are collected in a single system, which gives advertisers a unique opportunity to fully control the course of an advertising campaign and maximize its impact on the audience.
Functionality of the DSP

The functionality of the DSP often depends on the format of the media. For example, DSPs that advertise online can see how people behave after viewing an ad, whereas this is not possible in outdoor advertising or television and radio, where the advertising constitutes a one-to-many approach.
DSPs incorporate many of the facets previously offered by
advertising network
An online advertising network or ad network is a company that connects advertisers to websites that want to host advertisements. The key function of an ad network is an aggregation of ad supply from publishers and matching it with the advertiser' ...
s, such as wide access to inventory and vertical and lateral targeting, with the ability to serve ads, real-time bid on ads, track the ads, and optimize. This is all kept within one interface that allows advertisers to control and maximize the impact of their ads. DSPs track frequency information, several forms of
rich media
Interactive media refers to digital experiences that dynamically respond to user input, delivering content such as text, images, animations, video, audio, and even AI-driven interactions. Over the years, interactive media has expanded across ...
ads, and some video metrics.
Many third parties are integrating with DSPs to provide better tracking. In addition, DSPs use advanced price reduction algorithms, commonly known as bid shading, to help advertisers procure ad impressions for a lower CPM in the first-price auction.
DSPs are commonly used for
retargeting, as it is able to see a large volume of inventory in order to recognize an ad call with a user that an advertiser is trying to reach.
Types of programmatic buys
* Preferred deal: No auction, set
CPM, non-guaranteed inventory
* Programmatic guaranteed: No auction, set CPM, guaranteed inventory
* Private marketplace (PMP): Real time bidding, price floor, select group of advertisers
* Open exchange buy: Real time bidding, variable CPM, open to all advertisers
Examples
See also
*
Ad exchange
*
Supply-side platform
*
Ad serving
Advertising is the practice and techniques employed to bring attention to a product or service. Advertising aims to present a product or service in terms of utility, advantages, and qualities of interest to consumers. It is typically used ...
*
Header bidding
Notes
{{reflist
Online advertising
Marketing techniques