A supply side platform, also known as a sell-side platform, is a technology platform that enables publishers to manage, optimize, and sell their digital advertising inventory programmatically. SSPs act as intermediaries between publishers and demand side platforms (DSPs) or advertisers, facilitating the automated buying and selling of ad impressions in real-time auctions.
How Supply Side Platforms Work
- Inventory Aggregation: SSPs aggregate ad inventory from multiple publishers, including display, mobile, video, and native ad formats.
- Ad Quality Control: SSPs ensure that the ad inventory meets quality standards by implementing measures such as ad verification and brand safety tools.
- Real-Time Bidding (RTB): SSPs integrate with ad exchanges and DSPs to enable real-time bidding, where advertisers bid on ad impressions based on targeting criteria and bid prices.
- Header Bidding: Some SSPs offer header bidding solutions that allow publishers to offer their inventory to multiple demand sources simultaneously, maximizing competition and revenue potential.
- Yield Optimization: SSPs employ algorithms and data-driven insights to optimize ad placements, pricing, and fill rates, maximizing revenue for publishers.
Benefits of Supply Side Platforms
- Increased Revenue: SSPs enable publishers to monetize their ad inventory more effectively by reaching a larger pool of advertisers and optimizing ad yield.
- Automation and Efficiency: SSPs automate the ad selling process, reducing manual tasks and increasing operational efficiency for publishers.
- Granular Targeting: SSPs offer advanced targeting capabilities, allowing publishers to deliver more relevant and personalized ads to their audiences.
- Access to Multiple Demand Sources: SSPs provide publishers with access to a wide range of demand sources, including ad networks, DSPs, and direct advertisers.
Calculating Revenue with SSPs: Formula and Example
The revenue calculation for publishers using SSPs involves multiple factors, including ad impressions, fill rate, and eCPM (effective cost per thousand impressions). The formula to calculate revenue is:
Revenue = (Ad Impressions x Fill Rate x eCPM) / 1000
Example: If a publisher had 1,000,000 ad impressions, a fill rate of 80%, and an eCPM of $2.50, the revenue calculation would be:
Revenue = (1,000,000 x 0.80 x $2.50) / 1000 = $2,000