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Understanding the Demand Side Platform

The programmatic landscape can be a difficult one to navigate. Understanding how DSPs and RTBs facilitate ad buying is crucial to beginning your venture into the programmatic world. The Demand Partnerships team at Kargo is here to help you understand a little bit more about these acronyms, what they do, and how they will help you begin your buying journey.

What is a DSP?

DSP—or Demand Side Platform—is a buying platform leveraged by brands/agencies to bid on advertising inventory from a variety of sources (ie. publishers, TV networks, ad exchanges) and channels (ie. TV, mobile, OTT). DSPs offer a number of additional services, such as access to 3rd party data platforms, KPI and spend optimization algorithms and other workflow tools to help streamline the entire buying process. Without the DSP, advertisers would not be able to purchase their inventory programmatically. Think of the DSP as a market—a one-stop-shop for advertisers to browse available inventory (impressions) from a variety of vendors (publishers). 

What is RTB?

RTB—or Real Time Bidding—is the process through which the DSPs bid and purchase advertising inventory from the various supply sources. The entire buying and selling process is done programmatically (automated) through an instantaneous auction, similar to financial markets. All of this is conducted in real-time—the DSPs bid on open inventory and the buyer of the winning bid’s ad is displayed on the supplier's source all in the time it takes for the user’s page to load. There is no pre-sold/pre-bought inventory within the RTB marketplace.

Where does Kargo fit into the equation?

Kargo represents the supply source in this interaction and provides available ad inventory on behalf of its publisher partners to match the DSPs buying requirements. In real-time and all within fractions of a second, Kargo brings to its DSP market any open impressions, receives bids from each of the interested DSPs, and forwards along the highest bid to the respective publisher’s header. The publisher then selects the highest bid from its various supply partners, and if Kargo was responsible for securing the winning bid, Kargo will then notify the DSP and facilitate the creative delivery process.

And voila! That’s how it’s done. Little did you know all the technology and activity behind the scenes that occurs every time you load a webpage and are served an ad!

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