By Gulab Patil, CEO, Lemma
As the advertising industry continues to run through programmatic advertising and embraces first-party data, supply-side platforms (SSPs) play a crucial role in making programmatic ad buying more efficient and precise.
SSPs have long been a staple in programmatic advertising, introduced to overcome the limitations of traditional ad networks. They serve multiple functions that support both publishers and advertisers, including inventory aggregation, bid management, data provision, revenue optimization, and ad delivery. Their importance is only growing due to the importance of driving efficiency in advertising and the rise of artificial intelligence (AI).
SSPs have always benefited publishers as a way to maximize the supply they provide, but now advertisers, publishers, and media buyers can all optimize programmatic buying and improve targeting, cost-efficiency, and measurement accuracy by utilizing SSPs.
Why SSPs grew in importance
Historically, much of the data used for targeting came from the demand side, relying on third-party cookies and other external tracking mechanisms. However, as privacy concerns, regulations like GDPR and CCPA and browsers either removing third-party cookie support or giving users tools to remove them reshaped the landscape, first-party data from the publisher side has become a critical asset.
As such, SSPs are fundamentally changing how targeting signals are generated and used, which has made the supply side the new crucial source of targeting signals.
Publishers are using their valuable first-party data to help brands reach their intended audiences more effectively. This shift has empowered SSPs to play a more integral role in the data ecosystem by facilitating the flow of high-quality supply-side data into the programmatic supply chain. It also gives advertisers the opportunity to work directly with SSPs.
For media buyers looking to stay ahead of the curve, embracing SSPs is not just an option—it’s a necessity.
Media buyers’ direct power working with SSPs
There are several reasons why media buyers should work directly with SSPs.
SSPs enable more relevant bids and traffic: First and foremost, SSPs help media buyers get access to a more diverse set of traffic sources, increasing the variety of impressions they can bid on. They collect ad space from various publishers, offering a vast pool of inventory for advertisers to bid on in real-time. Having a direct relationship with SSPs means media buyers can get access to the most relevant bid opportunities for their specific advertisers
SSPs are able to solve supply path optimization through curation: Supply Path Optimization (SPO) improves efficiency by reducing the number of intermediaries involved in the advertising supply chain, which leads to reduced latency, increased transparency, and increased overall performance. Curation is the way SSPs contribute to the overall SPO strategy. SSPs can use all of the content metadata they get from publishers to filter and curate based on specific buyer needs.
Optimize QPS and solve bid bloat: Query Per Second (QPS) represents the number of bid requests an SSP can handle at any given moment. High QPS rates are essential for maintaining a competitive edge in the marketplace, especially as programmatic auctions become more complex and competitive. Optimizing QPS tackles bid bloat by minimizing excessive requests that could overwhelm the system, creating missed revenue opportunities.
Reduce ad waste and optimize the bid stream overall: SSPs provide data-driven audience targeting, ensuring that ads are delivered to the right users at the right time, optimizing not just the placement but also the context. SSPs also manage real-time bidding (RTB) for ad placements, which not only improves efficiency, but helps advertisers find the relevant inventory. This ensures that advertisers can bid on the right ad impressions at the right time, thereby reducing ill-targeted ads that don’t help consumers and advertisers connect.
Help to ensure there is enough ad inventory: Most SSPs have access to a large pool of publishers and ad placements including a range of formats and channels. The more SSPs an advertiser works with, the more opportunities for ad placements they’ll have, driving up their reach and publishers’ overall filling of ad inventory.
DSPs and SSPs – a dream combination for the buy side
Modern-day SSPs are significantly enhancing the performance of DSPs, elevating their effectiveness in the advertising ecosystem. The collaboration between SSPs and DSPs is proving to be a game changer in maximizing the impact of digital marketing strategies.
