Demand Side Platforms are tools designed for ad buyers, to make decisions about whom to reach, with combinations of targeting filters.
Let’s get right into it with the center piece of AdTech for companies that want to reach consumers: the demand side platform, or DSP.
That’s right, off the bat we’re starting out with an acronym. Get used to them because there are a lot more coming your way.
I’ll give you a brief history of the Demand Side Platforms, and some context about the business implications for 2020.
In 2008 there were a variety of companies that made massive ad inventories. They couldn’t sell them. These companies were primarily the largest portals – Google and Yahoo.
At that time advertising was being sold human to human. That is, sales people reached out to media buyers at ad agencies. And the whole process was really inefficient.
Slow Sales Cycle
Basically, the sales person would reach out, and the buyer may not be available. The sales person spent a lot of time on calls, and then emails, and finally there would be a meeting.
The buyer would tell the seller the campaigns and advertisers they were working on. Then there would ideally be an RFP, a request for proposal.
The seller would reach out a few more times. I feel for these people because they ate what they hunted. Selling is a really tough job, especially when the person who is the access to meeting your sales quota isn’t getting back to you. That can be challenging.
As a buyer we went on a number of really fun events during this process. And considering the volume of campaigns we had going on, sales people filled out our social calendars.
In fact, I remember the first two months of working at Universal McCann. I was on the buying team, planning out motion picture ad campaigns for Sony. We were taken all over town.
In the first two months I remember talking to my mom about how I was at Wolfgang Puck’s Spago restaurant twice. I was 24 years old and no way could I have afforded that on my own.
So, as a buyer it was a great experience. But, as a business process it was slow, inefficient, and oddly incentivized.
The seller would put together a campaign based on the existing available inventory in the marketplace. You’d get a proposal back from the seller.
This process was simplified by 2011. I started buying advertising through Demand Side Platforms including MediaMath and TubeMogul, now Adobe.
There were a lot of core benefits to buyers. One in particular endures to this day. It’s that buyers don’t have to talk to a lot of people to get an ad buy turned on.
It’s not that talking to people is bad. Buying on a DSP takes away the workload that a few extra calls a day could end up taking. It allows the buyer to do other work, primarily, optimizing campaigns.
Buying on Demand Side Platforms had other benefits and we’ll go into those in another video.
For example, the buying process when I got into advertising was that we’d put together a media plan. This was a full view of the places and channels the advertising was to run for a particular campaign.
You’d have rates, targets, timelines, and any other campaign specific details needed. If I wanted to run on 20 different sites, I had to go through that buying process 20 different times.
That’s lots of phone calls, emails, and notably, haggling over rates.
Thinking back about how much time was used to haggle over a cost per thousand impressions of 25 cents, it’s scary. My time could have been better spent if we could have skipped all of that work. I could have gotten right into the ad buying and optimization.
Then, at some point ad networks were introduced, which gave us the ability to buy advertising on a bunch of sites.
So, if I wanted to buy second or third tier sites that reached women, I could do that without having those sales conversations.
The Demand Side Platforms gave us a way to buy advertising space from a vast array of publishers, that simply didn’t exist before.
When we started using the DSP it was revolutionary to the advertising business. The use of the platform also came with adversaries and detractors.
In the next post we’ll talk about the data, the targeting, and more of the history behind using demand side platforms.