Programmatic advertising was introduced to the marketing industry about a decade ago. Since then, it has continued to evolve as the future of online advertising. It is commonly utilized by advertisers and agencies seeking more control and transparency over their ad spend.
A while back, one had to solicit the services of an advertising or media agency, then hold negotiations to decide value terms for different ad inventory. After this, the agent would use a manual insertion order before buying. However, programmatic advertising has eliminated this daunting task of buying and selling through machine learning and AI optimization.
Within the scope of advertising, there are numerous different components. Let us take a look at the popular platforms used today in programmatic advertising.
1. Demand-Side Platform (DSP)
A DSP is an advertising technology (AdTech) that enables media agencies to purchase ad space from multiple sites via a single user interface. It buys inventory from an ad exchange on behalf of advertisers, typically via real-time bidding (RTB) auctions.
For instance, an advertiser will input keywords into a DSP, which then utilizes machine learning to further the bidding process. The winning ad appears on the website after the page loads.
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2. Supply-Side Platform (SSP)
SSP is an AdTech program utilized by publishing sites to automatically manage, sell, and optimize ad space on their web pages and mobile apps efficiently. While DSP buys advertising based on data provided by a DMP, an SSP allows a publisher to sell available inventory via automated auctions to a variety of buyers.
3. Data Management Platforms (DMP)
The main purpose of a DMP is to collect, store, and organize data from an array of sources. Advertisers and agencies then use this information, collected from advertising campaigns, websites, and mobile apps, to improve ad targeting.
Publishers, on the other hand, can access reports about their viewers and inventory to enable selling data to third parties or offer their audiences to advertisers outside their website.
4. Ad Servers
Ad servers are components of advertising technology commonly utilized to create, manage, and run programmatic ads. They are used by publishers, agencies, and ad networks to decide which ads to show on a website. Ad servers enable centralizing your workflow for operational efficiency, which makes managing ads simple for publishers.
5. Ad Networks
An Ad Network acts as a go-between between publishers and advertisers. Unlike other AdTechs that manage ad campaigns and compile creatives, ad networks simply connect advertisers to websites that want to host advertisements.
The process of using different platforms to sell inventory on websites by publishers, and buying of similar instruments by advertisers, is what makes programmatic advertising an effective strategy. It helps you craft more targeted campaigns while reducing your ad spend. Programmatic advertising platforms give you a unified understanding of your digital marketing operations and performance.