Demand Partners 101

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New to Ad Tech[11] and Ad Ops[6]? “Demand partner” is a phrase you’ve probably heard being thrown around. It could be an Ad Ops partner saying they provide premium demand partners, or you could be looking up how to improve inventory[12] to attract quality demand. Demand partner is a relative term depending on where you fit into the Ad Tech ecosystem. For a publisher[13], a demand partner could be a DSP[1] and/or an SSP[2]—essentially, anyone who is providing creative[14] for a publisher’s ad unit[15]

There are several different platforms at play in completing a single transaction. In this blog post, we are looking at defining several industry terms, as well as examining different types of demand formats and why they’re important to publishers.

Definitions of ATD, DSP, and SSP

ad tech ecosystem

At a high level, there are three types of demand partners: demand-side platform, supply-side platform, and agency trading desk. Together, they evaluate the ad unit request, submit a bid, and provide a creative to the user’s page in real-time. This programmatic advertising[3] supply chain is visualized in the graphic above.

An agency trading desk is a team of media buyers and re-sellers within an ad agency[7] that helps advertisers with media buying. They use a proprietary technology or a demand-side platform (DSP) to buy and optimize media campaigns on ad exchanges, ad networks, and other available inventory sources they are connected with.

A demand-side platform (DSP) allows buyers of digital ad inventory[8] to easily and more directly connect with sellers in a programmatic and real-time environment. These buyers commonly include trading desks, agencies, or advertisers directly. To enable these buyers to be able to bid on digital inventory, the DSP has to plug into an SSP. 

Next, we look at a supply-side platform (SSP) is a platform that aggregates demand sources so that publishers can access many campaigns through a single partner. SSPs give publishers the opportunity to auction off their inventory, fill it with the winning buyer’s creative, and earn revenue. The goal of the SSP is to maximize its publishers’ ad earnings (eCPM[4]) and fill rate[16]. The SSP accomplishes this by making publisher inventory available to a variety of buyers, including DSPs, ad networks, ad exchanges, agencies, or even directly to advertisers.

Types of demand formats

Depending on which demand partner you connect with, they can have different demand formats available. 

The first type of format we look at is display advertising[9] which mainly made up of static text-based images, but can also be GIFs or animated HTML. This by far the most common ad format and can be found in any section of a website. 

display ads

Native advertising matches the look, feel, and function of a website’s page. They are less disruptive to the user experience, compared to standard banner ads[10]. They are often found in social media feeds, or appear as recommended content on a website. 

native ads

Video advertising is a video format that serves to ad units within a video player. There are three types of video ads[17]

  • Pre roll – Appears before video content begins
  • Mid-roll – Inserted at certain points within the video content 
  • Post-roll – Appears after video content is complete 
video ad example

Importance of demand partners

You may be wondering what all the fuss is about with demand partners. Demand partners play an important role in the ecosystem of programmatic advertising by providing the ad creative needed to fill the slot. They provide:

  • Increased yield[18] – With more demand partners bidding on your ad slots, you’re creating competition for your ad inventory and in turn, increasing your site’s revenue.
  • Diversity of ads – Having multiple demand partners allow for different ads and different types of ad formats (display, video, or native) to appear on publisher’s sites. There’s a wide range of CPMs between formats; a banner ad could have a $1.00 CPM[5], whereas video could be over $10.00 CPM.

Should you have more or fewer? In the case of demand partners, we recommend having between six to ten partners. Having too many demand partners can lead to added page latency, reporting and discrepancy issues, or navigating extensive blocklists and multiple partner mappings. 

Terms
1. Demand-Side Platform [DSP] ( DSP ) A Demand Side Platform or DSP is a platform where advertisers can buy digital inventory to easily and more directly connect with sellers in a programmatic and real-time ecosystem.
2. Supply-Side Platform [SSP] ( SSP ) A technology platform that provides outsourced media selling and ad network management services for publishers. The business model resembles that of an ad network in that it aggregates ad inventory, however they serve publishers exclusively and do not provide services for advertisers (e.g., FreeWheel, SpotX).
3. programmatic advertising. Programmatic advertising entails using machine learning and technology suites to buy and sell ad inventory with a data-driven process.
4. Effective Cost Per Thousand Impression [eCPM] ( eCPM ) eCPM is known as the effective cost per thousand impressions and is a metric used by publishers to determine the actual rate they’re earning from their ad inventory. eCPM is calculated by taking your (total ad earnings/impressions) x 1000.
5. Cost Per Mille/Thousand [CPM] ( CPM ) Cost per mille, or thousand (mille = thousand in Latin). A pricing model in which advertisers pay for every 1000 impressions of their advertisement served. This is the standard basic pricing model for online advertising. See also CPC and CPA.

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