Demand-side and supply-side platforms (DSP and SSP)

Programmatic advertising has a buyer's side and a seller's side, and each has its own software.

Demand-side platform (DSP). A DSP is software that lets advertisers buy digital ad inventory from multiple sources through a single interface, automating the purchase of impressions in real time. In a DSP an advertiser sets the target audience, bid amounts, budgets and ad formats, and gets campaign reporting back. DSPs took over features that advertising networks used to offer. Some are full-service, run for the advertiser by account managers; others are self-service, so the advertiser keeps direct control. Examples include The Trade Desk, Google Display & Video 360, Amazon DSP, Adform, Nexxen and Yahoo DSP.

Supply-side platform (SSP). An SSP is the publisher's counterpart. It lets web publishers, connected-TV publishers, app developers and digital out-of-home media owners manage their ad inventory, fill it with ads and collect the revenue. By offering each impression to many potential buyers at once, an SSP aims to maximize what the publisher earns, which is why SSPs are also called yield-optimization platforms. Publishers use them to set floor prices, the minimum bids an impression will accept. Retail media networks have adopted SSP technology to sell ads on retailers' own sites and apps. Examples include Magnite, PubMatic, OpenX, Equativ, Google Ad Manager and Media.net.

How the two meet. When an impression is available, the SSP sends a bid request to DSPs: the signal that lets them bid, with details about that impression. DSPs typically answer through real-time bidding, often via an ad exchange, a marketplace where publishers and advertisers buy and sell ad space in real-time auctions. Because the same impression can reach a buyer through several SSPs and exchanges, buyers practise supply path optimization to choose the most efficient routes.

A market that consolidates. Platforms on both sides are regularly bought and merged. In 2017, for example, Amobee, the ad tech arm of the Singapore telecom company Singtel, acquired the independent DSP Turn at a $310 million valuation.