Should You Use Demand-Side Platforms to Manage Display Advertising Campaigns?

The Digital Essentials, Part 3

Developing a robust digital strategy is both a challenge and an opportunity. Part 3 of the Digital Essentials guide series explores five of the essential technology-driven experiences customers expect, which you may be missing or not fully utilizing.

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Enlighten was acquired by Perficient Digital in December 2015
Demand-Side Platforms (DSPs) are changing the way that digital media buyers plan, track and price based on online ad inventory with display impressions aggregated across multiple ad exchanges. Most benefits accrue to medium to large advertisers who invest in “targeted reach” media as part of a larger media campaign. As DSP technology improves, the advertisers who rely on the DSP to identify and purchase relevant inventory through in nearly real-time bidding (think, spot buying) will be delivered better results and higher conversion rates.
 
How does demand-side platform technology help advertisers?
DSPs enable advertisers, agencies and ad networks to buy display impressions amassed across multiple ad exchanges. The principle need is to aggregate demand, and the complexity of doing this (particularly in real time) is what fashioned a new technology category for the DSP. It provides a single interface to the supply-side of the value chain for a number of advertisers, and makes exchanges more accessible. Forrester defines a DSP simply as, “A dedicated buy-side tool that helps media buyers aggregate, bid on, and optimize display inventory across exchanges, yield management platforms, and ad networks.”
Buying media through a DSP is similar to day-trading that incorporates bid-management, analytics and data integration. The DSP negotiates between ad networks and publishers/advertisers to make up for shortfalls in supply and demand. This allows for scale that some marketers would not be able to otherwise achieve across networks.
The DSP is a programmatic buying platform that ultimately brings the client and the buyer closer through what is more broadly a Data Management Platform.
 
The challenges with DSP technology
DSPs use complex technology to manage workflow and reporting to streamline buyers’ bid-based buying processes; however not all DSPs use the same approach for optimization. A proliferation of providers exists, with many leveraging a specific area of focus: reaching the target audience, engaging in dynamic buying or streamlining the process.
The competitive landscape is substantial, and the supporting technology is both complex and expensive. The major players (Google, Yahoo and Microsoft) are taking the lead in building out Ad Exchange infrastructure. A DSP could aggregate offerings from all three exchanges: AdEx (Google), Right Media (yahoo) and AdECN (Microsoft). A few companies currently standout: Media Math, Turn, DataXu, Invite Media and AppNexus provide improved client interfaces along-side their DSP technology platforms.
The Advertising Technology Landscape (below) illustrates the value-chain from advertiser to publisher (audience) with the vendors, and management tools that have sprung up between.
Where we stand at Enlighten (now Perficient Digital)
The online advertising supply chain will continue to evolve, and it is important to be aware of the consolidating market place and buying platforms that bring the advertiser and the buyer closer. As audience profiling becomes more sophisticated, ad delivery will become more efficient in terms of both supply and demand. Finding and reaching the most desirable audience will be the challenge.
At Enlighten, we’ll work with our clients to continue to address business-needs, as well as to recognize and customize the appropriate level of technology required for their business. We anticipate the landscape will shift, first with integration across adjacent categories, followed by more aggressive market consolidation with stimulus from bigger players (e.g., Google, yahoo and Microsoft). And, indeed, the landscape is already shifting: Just two months ago, the Turn Media Platform added in-stream and mobile video advertising capabilities. As DSPs begin to offer rich media options, we are beginning discussions with a few clients. In the meantime, we will continue to use ad networks, and targeted or performance based media with many of our clients.