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Why You Should Be Using a Demand-Side Platform for Location Advertising

Advertising in 2020 is about the use of precision data, iterative learning, and the ability to be everywhere to a niche group of users. 

A key element of success for many advertising agencies, and their clients, is the deployment of a demand-side platform. In this article, we’ll talk about what they are, how they are integral for location-dependent advertisers, and how you can access them.

A demand-side platform (DSPs) is software designed for advertisers and their agencies to buy digital ad space with ease. They were developed to simplify the ad-buying workflow, which, in the past, was really cumbersome. Before DSPs existed, media buyers would reach out to individual publications. If I wanted to reach men for a male-skewing movie release, for example, I’d negotiate with individual sites that reached men. We’d talk about a strategy, discuss placements, and haggle over pennies on the rate. It was a long process involving small talk, phone calls, lots of Excel documents, lunches, dinners, and more Excel documents. 

Then in 2008, DSPs were developed, and by 2011, they were getting mass adoption. Instead of having conversations and rate negotiations with publishers, DSPs had already made connections to these publications, and I could simply go in and buy the ad space based on targeting filters. That’s the basic premise of a DSP — to create work efficiencies so that media buyers have more time with data and optimization because they spend less time dealing with the upfront setup.

Data and automation for advertising is a $68B business in 2020, representing 85% of all display advertising. Demand-side platforms are at the heart of that ecosystem for advertisers. 

Location data can be maximized with demand-side platforms. Without any access fees, advertisers can log in to Facebook and Google and take advantage of some location data capabilities, but these capabilities are not as robust as what can happen outside of these platforms. For example, Facebook Ads can be targeted to a 1-mile radius around an address. With DSPs, including The Trade Desk, MediaMath, Basis, and RTBIQ, an advertiser can target ads to people who are seen in specific buildings.

For example, if you are a budding consumer packaged goods (CPG) brand and you get distribution in Walmart stores in LA, it doesn’t make sense to target ads to everyone in LA, because the only buyers you have are going to be those walking into Walmart. Hyperlocal data should be used to target people who have been seen at a Walmart in LA in the last 30 days. These are your buyers.

If your product is a health brand, let’s say kombucha, then target ads to Walmart buyers who are also healthy product consumers. In one platform alone, there are over 160 different data providers, and over 500,000 segments that exist as pre-packed segments. You’ll find healthy consumer segments and kombucha consumers. The custom targeting for this campaign is anyone who has done all of these behaviors:

  1. Have been to a Walmart in LA in the last 30 days as defined by latitude and longitude data
  2. In a consumer segment indicating health food consumer, or in a segment indicating kombucha drinker

That’s how location data is activated in a unique way that isn’t available in Facebook or Google. The only way to set it up like that is to have a login on the DSP or work with an agency that has a DSP login. 

DSPs have fantastic data, great targeting, and the ability to serve up customized audiences for location advertisers.

But most agencies aren’t using a DSP for three key reasons:

  • DSPs are the realm of Fortune 500 brands. Sales people from DSPs typically want to sell to big agencies like Universal McCann and Starcom because their advertisers have massive budgets. Smaller agencies that came up on Facebook and Google, therefore, may not even know that DSPs exist. 
  • If they do know about DSPs, there are two additional hurdles. The first is cost. These platforms require upwards of $100,000 per month in ad spending, with an annual commitment, just to get a log in. So that right there is a deal-breaker for many agencies. 
  • Finally, even with access to DSP, there’s a big learning curve. Imagine the learning curve of having a jet engine at your disposal, and barely knowing the right buttons to push to turn the thing on! It’s like that. The setup of these platforms helps advertisers reach niche audiences, drive business outcomes, interpret the performance data, and grow brands.

For advertisers looking to use these advanced location data sets, inquire with your agency about their use of DSPs. If they aren’t using them, it’s possible to bundle advertising spend with other advertisers to get access. 

Finally, as you consider location-specific data, look at these nine companies for more information: Foursquare (which recently bought Factual), The Trade Desk, MediaMath, RTBIQ, Basis, Ninth Decimal, Simpli.fi, Place IQ, Audigent, and El Toro.

In summary, as you consider your advertising efforts, look at demand-side platforms to centralize your access to ad inventory, data providers, and customized audience filters to make your campaigns stronger.

Robert Brill is the CEO of BrillMedia.co and the host of the LA Business Podcast.

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