The role of SSP and DSP in internet advertising

Efficiency and optimization are critical in online advertising, and such tools as SSP and DSP help with this. These technological solutions provide seamless interaction between publishers and advertisers, automating the processes of buying and selling advertising space. In this article, you will learn about the features of SSP and DSP, which can be important if you want to launch customized programmatic platforms.

What are SSP And DSP?

SSP (Supply-Side Platform) is a platform in the programmatic ecosystem that is used to sell advertising space on publishers’ websites. The technology allows users to monetize their web resources and sell placements at the most favorable rates.

DSP (Demand-Side Platform) is a platform in the programmatic ecosystem that is used to purchase advertising space from the advertising exchange. The technology allows the advertiser to choose the best place to display ads among many sites on the Internet.

The platforms can be focused on both mobile and desktop traffic. Both systems are involved in the RTB auction but represent the interests of different parties (SSP – publisher, DSP – advertiser). Their interaction is built through Ad Exchange – a virtual advertising market where site representatives put up their advertising spaces.

SSP And DSP operation

Let’s imagine that a new publisher has entered the market, wishing to monetize their resources. They enter into an offer agreement with one of the SSP platforms and place special codes on their website, each of which is responsible for displaying ads in a particular block of the page. In this way, the platform is integrated into the system.

When a user opens a website, the SSP collects data about them via cookies and sends the lot to Ad Exchange. The DSP accepts a request to display an ad, and checks the user profile information in the database, as well as in the database purchased from the DMP.

Programmatic platforms, like Facebook Ads, analyze the user profile and try to show them only relevant ads. Of course, the big data analysis algorithms of traffic networks will be more modest than those of Facebook, so it is too early to dream of powerful optimization.

If the user data matches the advertiser’s settings, the DSP makes a bid. The SSP checks all incoming bids and, using the second price tactic determines the cost of displaying the ad. In response to a request on the publisher’s website, the user’s browser receives the ad that won the auction. It is shown to the user.

(Image credit) What is the role of DMP?

DMP (Data Management Platform) is a platform that collects and organizes data from various sources, making it available to other platforms (CRM, DSP, SSP, social media advertising accounts, etc.).

DMP receives data without processing from various sources, including websites, Internet providers, plugins, etc. The process of collecting and extracting data is called data mining.

First, DMP collects raw data on user behavior on the network. This is anonymized data that contains information about the user’s interests (categories of sites they visit), engagement, devices from which they access the network, etc. The task of DMP is to normalize this data, that is, segment it and draw certain conclusions.

SSPs use DMPs to increase the cost of traffic. DSPs use DMPs to buy impressions as efficiently as possible and achieve precise targeting. DMPs come into play before, during, and after the auction. Before the auction, they select the right audience. During this, they help target the right users and make decisions about participating in the auction. After, they draw conclusions about the campaign: they analyze user engagement, and ad perception, and use this information when conducting subsequent auctions.

Similarities and differences between SSP and DSP

Both SSP and DSP, in addition to collecting data on their own, request information from DMPs to achieve better results for their clients. The former needs this to better understand the advertiser and get analytics that can be used for more favorable pricing. And the latter needs it to find a more relevant audience for the offer.

Despite the fact that the platforms are involved in the same process, their settings and operating technologies differ:

• DSP uses the results of big data analysis to set up targeting. Advertisers can set demographic characteristics, location, user interests, and other parameters to find suitable sites for advertising and participate in the auction.
• SSP optimizes inventory management to get maximum revenue from available advertising space. SSP allows publishers to limit access to advertising to specific brands/product categories, set lower limits for the bid cost, and place available spaces on different Ad Exchanges.

The largest SSP platforms are PubMatic, Rubicon, and AdMeld. The latter is considered the leader in the global market. It was bought by Google in 2011.

Any platform and any action that occurs on it is controlled by numerous programs and algorithms. Before an ad is shown to a user, it goes a long way – collects data, participates in an RTB auction, and uses complex systems on both the publisher and advertiser side. And at first glance, it seems that everything is extremely simple.

A driver does not necessarily have to understand the structure of a car to just drive. But if it is related to professional activity, knowledge of technical basics will allow you to do the job more efficiently and avoid unpleasant incidents. The same principle applies to traffic arbitrage. You can successfully purchase advertising without understanding the internal processes, and the structure of SSP, DSP, and RTB auctions in general.

However, knowledge of the intricacies will help you launch programmatic platforms customized to your needs and earn a lot of money. If you are interested in promoting a customized programmatic platform, we recommend paying attention to Teqblaze, a reliable supplier of white-label DSP, SSP, and other programmatic solutions.

Final thoughts

SSPs and DSPs play an important role in modern online advertising by automating the processes of buying and selling ad space. SSPs help publishers maximize ad revenue, while DSPs provide advertisers with precise targeting and effective ad placement capabilities. The interaction of these tools is aimed at creating a more efficient advertising ecosystem.

Featured image credit: Freepik