Demand Side Platforms – Love at First Sight?
There is a lot of hype around Demand Side Platforms (DSPs) in the media world. It seems that the majority of media folk are not completely sold on DSPs, and/or do not fully understand them. Are DSPs just a more automated way to buy media? Do they provide any other value beyond minimizing my work-load?
To fully understand the function of a DSP, it’s important to know the differences between DSPs, ad networks, and ad exchanges and their specific points of differentiation. From my research, ad networks are the most well-known and understood, so let’s start with those.
He loves me…
· Ad networks use third party data providers for their targeting capabilities and are able to target behaviorally, contextually, or demographically or filter on the site level.
· They are 100% accountable for fully delivering impressions. If a network under- or over-delivers, the advertiser is compensated in return, reducing the liability.
He loves me not…
· Ad networks pre-buy their inventory up to a year in advance before they know the demand.
· They purchase hundreds of site’s remnant inventory.
· Ad networks cannot guarantee that every impression bought is being seen by your specific audience.
· You are stuck with paying on a flat CPM basis.
Clearly, an ad network isn’t someone you’d want to bring home to meet the parents. But maybe an ad exchange can get us closer to someone worthy of being classified as “boyfriend material.” Similar to a pay per click model, an ad exchange allows you to:
· Dynamically bid on what you believe is the value of each visitor or impression.
· Rather than buying impressions in bulk, an ad exchange allows us to pay for only the impressions we want and value.
So is a DSP your knight in shining armor? I wish I could tell you it would solve all your media planning/buying nightmares, but this is not the case. A DSP does allow for you to bid, optimize and make overarching plan changes instantaneously. Sounds great, right? Sadly, not every site is onboard with DSPs. What I mean by this is that you may not be able to solve all of your media buying needs on a DSP if some of your niche sites are still requiring you to buy their inventory directly through them. This still creates a management and reporting nightmare. Nobody enjoys aggregating 17 sources of data into one pretty weekly report.
So is a Demand Side Platform really love at first sight? Hardly. If there ever comes a day that all publishers are required to sell their inventory via DSPs then we might actually get a media planning/buying “Happily Ever After.”
