A lot of advertisers are not familiar with the programmatic advertising term: demand-side platform (DSP). There are a lot of questions about what a DSP is and how different DSPs compared to Google Ads.
Most of the demand-side platforms are similar to Google’s advertising platform, Google Ads. But DSPs are offering a more vendor-neutral real-time bidding (RTB) ecosystem while Google Ads lets you run your advertising campaigns only on its own network.
In a nutshell, Google Ads was primarily built around search, keyword, and text advertising. Display advertising became available after Google’s acquisition of DoubleClick and expansion of Google Display Network. On the other hand, programmatic advertising platforms (DSPs) are built around display advertising but you can publish other types of ads as well.
Let’s take a look at the similarities, differences, pros and cons of DSPs and Google Ads.
What are DSPs and How Different Are They From Google Ads?
Demand-side platform (DSP) is a technology system that allows digital advertising inventory buyers to manage their accounts on multiple ad exchanges. Therefore this system can be defined as a platform that brings together various traffic resources, buyers, and sellers in a single interface. However, the platform is “demand” focused since it intends to make buyers purchase traffic from various traffic resources; i.e. to create demand.
DSPs are similar to Google Ads as they are also campaign management tools. But they differ on traffic sources and campaign types. You can use a DSP to purchase traffic from integrated sources like AppNexus, Mopub, Pubmatic, AOL, etc. You can also purchase Google’s inventory if that DSP integrated it as a traffic source. Whereas Google Ads only lets you use Google’s inventory. When it comes to campaign types, with a DSP, you can publish additional ad types like native, video, pop, and push.
Google introduced Google AdWords (now Google Ads) which dominated the paid search market by the mid-2000s. Afterward, banner or display advertising became available within as well. The ads can be served by location, day and time, demographics, etc. Nowadays, the paid search and banner advertising through Google Ads, is a fast and obvious solution to advertise products and bring services to market.
With technological improvements, programmatic advertising companies came up with a breakthrough, demand side platforms. With that, advertisers gained the ability to target based on very specific targeting options including industries, companies, job titles, and even individuals.
Programmatic advertising platforms (DSPs) are the way to market products and services to specific devices and individuals using available data such as IP and cookie databases. For example, if a person is working for Boeing and in charge of procurement, he/she leaves a large online footprint that may include business profiles, browsing history, cookies, downloaded content, submitted forms, online registrations, etc. Third-party data providers can collect the permitted intelligence and offer it to DSP networks through DMPs. Apart from that, some DSPs let you use first and second-party data as well. This way the network delivers ads only to a very specific audience related to the aviation industry, for our example, that would be Boeing executives. Thanks to data-driven targeting options, DSP’s are constantly evolving by finding more partners and allowing advertisers to target even more precisely through multiple devices and ad formats.
Different Benefits of DSPs and Google Ads
For some industries, Google Ads is the easiest way to go to market and, based on the user’s budget, receive thousands or millions of ad impressions within days. To serve the ads within a specific network, companies can choose individual sites, sites grouped by specific topic, audiences by interest and even “in-market” indications. This is ideal for B2C advertisers who are trying to reach mass or local markets, B2B companies that offer well-known products or services, or for branding purposes.
With demand side platforms, advertisers can select the target audience not only by location or what people search or browse but by industry, company name, job title, job function, seniority and even by decision-making power. Just like Google, DSP networks can offer “in-market” groups, or “bottom-of-the-funnel” traffic based on peoples’ online behavior and can identify those who are ready to buy. Unlike Google, those “in-market” activities can be attributed not only to individual users but to entire organizations that are looking for products and services. With the ability to target organizations and decision-makers, DSP’s can be integrated with account-based marketing (ABM) strategies and used to reach specific lists of companies and influence the active sales process.
Disadvantages of Google Ads Compared to DSPs
The biggest disadvantage in Google Display ads is that advertisers can’t choose the industries, companies, or job titles they want to target. Some PPC managers are using “interest” and “topic” targeting in Google settings to serve their ads on specific sites that are likely to have their target audience as visitors. Still, on most occasions, their ads don’t reach the desired audience and the traffic comes with a high bounce rate.
Google Ads might not be the best solution to target an audience precisely as it’s hard to narrow down the settings and show ads only to a razor sharp targeted audience. Many advertisers struggle with the quality of traffic from Google because they receive clicks from irrelevant or too broad audiences for their offer. This problem occurs especially with Google’s predefined, in-market audiences. For instance, in our example with Boeing, when targeting ads by topic or interest a company that is trying to reach aviation executives will receive a lot of clicks from aviation enthusiasts or travelers.
Cost-Per-Acquisition (CPA), as well as cost per advertising in search results and display, is another big issue advertisers are facing. To acquire high sponsored search positions advertisers must overbid their competitors and in some industries, the price for a single click can go anywhere from $20 to $200. On display, the competition to appear on top networks can be high. Advertisers who are trying to keep their display bids on a lower level are getting traffic from the lower quality sites that also bring more fraudulent clicks.
“Click fraud” is another big issue on Google Display. It certainly exists on Google Search when competitors click the ads, but Google Display suffers the most from fraudulent activities. There are several ways to spot a click fraud by looking at ad placement performance; too many clicks from the websites with poor, little, no content, or unrealistic click-through-rates that can be even higher than 100%. Google AdSense is the main culprit of “click fraud” because it allows anyone, no matter how small, to register and make money by serving ads on their sites.
Your landing pages need to be top-notch to comply with Google’s standards. Before approving your campaign, Google checks the quality of your landing page and if you are not following their requirements, either they decrease your quality score, which basically means you pay more for every single click, or don’t approve your campaign at all.
Speaking of reporting, Google Ads requires a prolonged period for the data to be presented as a report, whereas DSP advertisers can access campaign data in real time reporting features.
Also, mastering a Google Ads account, setting up, optimizing and tracking ad campaigns can be a time consuming and complicated process. Therefore it’s recommended that companies work with an agency or have an experienced digital marketing professional in-house. The final cost of running Google Ads can skyrocket and miss the desired CPA otherwise. Not to say that some companies never see real conversions or leads coming from Google.
Why is “Click Fraud” Less of a Problem for DSPs?
Some might ask: “DSPs are serving banner ads just like Google Display does, so how come “click fraud” doesn’t affect DSPs as much as it affects Google?” In answer, DSPs mostly work with the big reputable publishers and content providers that can deliver enough volume of web traffic. Small publishers don’t bring enough revenue for independent DSP and programmatic ad platforms. Therefore it’s highly unlikely that someone can trick the system by serving ads on their low-quality sites.
Also, to keep the traffic quality high, DSPs are integrating 3rd party brand safety and fraud prevention solutions like Double Verify, Fraudlogix, and Integral Ad Science. These solutions are filtering bot traffic so that only clean & real human traffic is served ads. This means DSP users are less likely to be exposed to security or quality threats.
Customer service is another reason why DSPs catch click fraud faster, act accordingly, and make adjustments for their clients. Programmatic networks are more selective of companies to work with and don’t have millions of accounts like Google does. Unlike Google Ads, it’s easier for marketers to reach out to their DSP customer success representative and file a complaint.
Google Ads Targeting Limitations
Google Ads offers several ad delivery options such as Google Search, Display, Remarketing, Video, Mobile, Maps as well as various settings such as geo targeting, demographics, day/time, in-market, etc. But there are still many targeting limitations because Google is limited to delivering ads through its own network (Google Search, YouTube, Maps, Gmail, etc), partners, and affiliates (Google AdSense).
DSPs are taking a more crafted approach when it comes to allowing advertisers to create campaigns, target the right audience, and deliver ads. DSPs allow the opportunity to purchase impressions from numerous different traffic sources, including Google’s own network. This way, advertisers can show their ads to Google’s or other networks’ audience according to their liking and reach a more extensive range compared to Google Ads.
One of the biggest Google Ads targeting limitation advertisers are facing is the inability to deliver ads by IP. This makes the Google platform less effective for demand generation and account-based marketing strategies.
DSPs offer a bigger selection of targeting options when it comes to the types of electronic devices, mobile operators, connection types (3G, 4G, 5G, Wi-Fi), browsers and much more. Google Ads keeps adding new targeting options but they always come with a big delay.
Another big miss for Google Ads targeting is not letting advertisers choose what third-party data providers they want to use. Google offers interest, topic, or even “in-market” audience options for the ads to appear for. But no one knows what exact data Google is using to determine who is “in the market” for a product or service or what level of interest or engagement is presented in its “interest” targeting option. Whereas, with a DSP, you can target your audience with 1st, 2nd or 3rd party data and this lets you hit the bullseye every time while targeting an audience.
Disadvantages of DSPs compared to Google Ads
DSPs can be easier for campaign management as well as better equipped to identify the right target audience but there are several disadvantages of DSPs as well. Firstly, though ads appear as banners on various networks and websites just as they do with Google Ads, dishonest publishers can participate in “click fraud” activities to inflate earnings. However, as mentioned before, top class DSPs take precautions by implementing fraud protection services so all you have is bot filtered, real human traffic.
Secondly, it’s hard to control where the ads will appear and what networks will display the banners unless you whitelist the webpages you would like to run your campaigns. In today’s world advertisers and users express concerns that their banner ads can be seen on networks that promote hate, bigotry, illegal activities, or extreme content. As mentioned before, DSPs work with direct publishers & other traffic sources to serve ads. However, many of those publishers have a large portfolio of sites and networks, including affiliates, that might have borderline and questionable content pieces.
Moreover, for security reasons, more companies have IT departments that are using tools and techniques to clean the online activities of their employees. Because of that, DSPs can’t serve ads to the companies that periodically clean browsing histories, delete cookies, block IP’s, change settings, etc. on employees desktop or mobile devices.
Using DSPs for Account-Based Marketing
Account-Based Marketing, or ABM, is a strategy marketers use to target and engage with a specific set of accounts. With the ability to deliver ads to specific devices based on what company and what professional it belongs to, DSPs find the right audience for their ads and can be integrated with other ABM activities.
DSPs or programmatic networks can be used for various ABM strategies:
- Delivering ads to executives, decision-makers, and end-users in targeted organizations
- Influencing prospects who are in active sales processes
- Using ads as sales enablement
- Remarketing/retargeting to web visitors and contacts in the database
- Finding similar industries, companies, and professionals who are more likely to buy
- Delivering crafted personalized messages in the form of a web ad or promoted social post
Here’s an example of integrating a DSP with an ABM strategy. Many companies are using marketing automation platforms to identify accounts that are more likely to buy their product or service. With DSPs, it is possible to integrate ad campaigns with marketing automation to serve ads to the same companies and people who received a newsletter or a phone call from a sales professional. That way the potential buyer has not only talked to sales but also sees web banners and online ads while browsing the internet or scrolling on their social media accounts.
How Google Ads and DSPs Can Benefit Each Other
Many companies are running DSP and Google Ads at the same time and manage to have these different programs successfully integrate and benefit each other.
The most effective way to integrate DSPs and Google Ads is to invest in technology that determines which companies are coming to your site, a process called reverse-IP tracking. This way advertisers can see who clicks on their Google Ads and can then target those companies with the banners through DSP platforms.
Additionally, by running remarketing campaigns on both networks simultaneously, each program can “fill in the blanks” of the other to compensate when one network can’t deliver ads to a specific group or audience.
Lastly, DSP banner ads can be the first or the last touch before accounts convert. Some companies might find an offer on Google and then click a banner. Or vice versa, the prospect may click the banner to review the company and then go to Google to search for more information. Google Ads and DSPs can work together to influence peoples’ final decisions.