Is your demand-side platform real or fake?

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I previously covered why marketers should demand transparency from their partners. Transparency is an unstoppable force because it roots out inefficiency. And companies that operate in ways that lack transparency, whether in their business model or product, are on the wrong side of history.

Take, for example, demand-side platform (DSP) companies. For the past seven years, there have been dozens, if not hundreds, of companies worldwide claiming to be DSPs. But how many of them are really technology companies? And how many are just pretending to be?

In this article, I’ll cover several major areas worth illuminating to get to the bottom of whether your DSP is real or fake. These questions should help you determine if you are dealing with a real DSP with technology of its own, or an intermediary like an ad network or agency that’s posing as a DSP.

As a refresher, a DSP is a piece of media-buying technology for advertisers. DSP technology allows advertisers to buy media from thousands of publishers in a centralized and automated manner.

The following diagram illustrates where DSPs sit in the ad tech landscape:

Source: AdProfs

Now that you know the function of a DSP, how do you determine if your DSP is real or fake?

Here are four major signs to look for:

1. Lack of self-serve interface

One of the clearest signs that your DSP is fake is the absence of a self-service user interface (UI). Without the ability to log into your DSP and examine the performance of your campaigns, you are flying completely blind. You have to rely on your account manager to send you reports, which stinks, and it jeopardizes the integrity of your campaign data.

In some cases, your “DSP” may have a UI to log into, but you may notice a lack of substance in the reports. You may notice half a dozen to a dozen reporting columns, showing all the basic campaign metrics like impressions, clicks, click-through rate and so on. But nothing beyond that. And certainly nothing deeper than your overall campaign stats.

If you notice that you can’t even pull domain-level performance reports from the interface, you are most likely dealing with a fake DSP that has built a rudimentary reporting interface on top of real DSP technology. In other words, you are working with a middleman, not the underlying DSP technology provider.

(Note: One exception that comes to mind is Criteo. It is, in fact, a real DSP technology provider. However, it provides no domain-level transparency to advertisers, and in practice operates more like an ad network.)

If you work with an intermediary, people are essentially pulling the levers on a DSP behind the scenes to configure, and possibly optimize, your campaigns. What you see in the interface, if there is an interface at all, is all you get without having to request it explicitly from your account manager. If there is no interface at all, and all you get are Excel spreadsheets emailed to you, you are in a vulnerable position because you have to trust those reports at face value.

Furthermore, if a company is telling you that a self-serve interface is unimportant, and promising you outcomes instead, you are dealing with an ad network or agency — or may as well be.

Ad networks promise outcomes and tell you not to worry about how they are achieved. They may even offer you the option to buy on a cost-per-click (CPC) or cost-per-conversion (CPA or CPI) model, where you only pay for those outcomes. That’s the behavior of an ad network, which takes that risk on in an attempt to arbitrage the price they charge you with the price they pay for those clicks and conversions.

That’s the beauty of proper DSPs — they give you full transparency into your media buying campaigns, so that everything can be scrutinized and optimized, with no middlemen extracting value through arbitrage.

2. Lack of technical ability

Building a DSP is no trivial task — it’s hard work. It takes a high degree of technical acumen and a significant investment in engineering and infrastructure to support DSP operations.

Real DSP companies that have their own technology almost always have an application programming interface, or API, which can be used by advertisers to create and control campaigns and pull reports. Real DSPs are never built on the API of another DSP.

[Read the full article on MarTech Today.]

Some opinions expressed in this article may be those of a guest author and not necessarily Marketing Land. Staff authors are listed here.

About The Author

Ratko Vidakovic is the founder, author, and principal consultant at AdProfs, where he and his team advise a wide range of clients — marketers, publishers, tech companies, and investors — on the inner workings and best practices of advertising technology. He also publishes his insights on ad tech industry news in his weekly newsletter, This Week In Ad Tech.


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