There are three major players in the world of programmatic advertising: SSPs, DSPs, and ad exchanges. SSPs are supply-side platforms that place ads on publishers’ websites. DSPs are demand-side platforms that help advertisers buy online ads by targeting specific audiences with bidding tools. And an ad exchange is a marketplace where buyers bid for ad impressions to display their advertisement on the publisher’s website. The difference between each platform type is significant, so it’s important to know what you’re getting into before jumping in head first!
SSPs are always on the publisher’s website. It is a platform that allows publishers to sell inventory directly from their site, often at real-time auctions where prices go up and down as more buyers enter the bidding war for ad space. SSPs can include open exchanges or private marketplaces depending on how much control the publisher wants to have over the ad inventory. SSPs also collect and analyze data, such as user interests and behavior, to help advertisers serve more relevant ads.
SSPs work by making an impression available for purchase on a publisher site – this is where SSP’s name comes from – Supply Side Platform. A DSP can see this SSP impression and bid for it. SSPs can also sell directly to DSPs, in which case the SSP is acting as an ad exchange or marketplace.
DSPs are essentially SSPs that are optimized for advertisers. DSPs are used by marketers looking to buy ad space and place their ads across a range of publisher sites.
DSP’s collect information about what kind of audiences they want to reach using data like demographics and interests and purchase inventory from SSPs and exchanges to find the best available audience.
Marketers using DSPs also need to ensure that their algorithm picks inventory from SSPs with the best CPM (cost per thousand impressions) or CPC (cost-per-click). If SSP A has a $20 CPM and SSP B is only at $15, but SSP B’s inventory comes from sites with better user engagement metrics like time on site and page views per visit, DSP marketers might want to go with SSP B.
An ad exchange is a platform that enables advertisers and publishers to trade advertising space in real-time. Ad exchanges are typically partnered with SSPs, which provide the inventory for sale within an ad exchange marketplace. The ad exchange is a neutral platform and connects SSPs and DSPs and enables real-time buying and selling of ads.
What is the main difference between these three platforms?
The main difference between SSP, DSP, and ad exchange is that SSP works with publishers directly to grow their demand-side platforms, whereas a DSP works with advertisers to help them buy ad space from SSPs. Ad exchanges connect SSPs and DSPs in a real-time bidding system that maximizes campaign performance for advertisers or publishers by serving their ads to the highest paying bidder available, allowing maximum competition between buyers.
Knowing the difference between these three types of platforms will make it easier to understand how programmatic advertising works. Do some research and find out what each platform offers in order to learn more about their capabilities, or reach out to us for more information.