DMP vs DSP: Differences & Similarities Explained
by Cat Hausler
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With the rise of Connected TV advertising, marketers need to learn a lot about the fastest growing ad channel—and quickly. That’s why we’ve compiled the top questions and answers from Quora, where experts address complex questions, into a digest for a quick breakdown on what marketers need to know most.
See what marketers are asking, and what the experts have to say.
Q. How do people measure the success of a TV commercial?
A. TV commercials were once notorious for their lack of measurability, but it depends on the type of TV. Times have changed, as now TV can be considered a direct-response advertising tool. This same sentiment applies for advertising on Linear TV, as it’s quite hit or miss – but to be honest, it’s mostly the latter. Advertisers only have ratings and time of day to rely on, to reach their audience, and use this type of advertising for their top of the funnel marketing efforts to drive brand awareness.
When it comes to measurement, TV data reveals who is watching a program, where they’re watching it and impressions, but only tells half of the data story as there is little insight on how a viewer perceives your brand after watching your ad.
Q. What is the best DSP for an advertising campaign?
A. Those of you on the DSP bandwagon, it’s time to get off. We’ve tallied up the pros and cons of using a DSPs, and there was so much to cover that we dedicated a blog post to it. Feel free to read through this at your own leisure as this post goes into greater detail about the risks of using DSPs for your advertising campaign. However, if you’re wanting a quick snapshot, there are a few reasons why DSP’s are doing a disservice to advertisers hoping to maximize their ad dollars and generate a good ROI.
Q. What tools in 2020 are used for creating effective video ads?
A. You could say that 2020 is the year where Connected TV became mainstream, thanks to a global pandemic shifting consumer behaviour and forcing most of us indoors. A study by McKinsey reported that more advertisers are shifting their budget to digital than ever before, as more than 62% percent of consumers consume digital as a source of news and product discovery.
Currently, 73% of people are sticking with stay-at-home orders, and 36% report to be streaming TV more than usual, which happens to be the most common activity out of them all in 2020. This can only mean one thing for advertisers: TV and mobile is your best bet at reaching audiences through video. This approach was once fragmented at best – you would usually set up creative and targeting separately for each channel, perhaps using a different agencies for each or a DSP. You would then need to track the performance of each separately, and since different providers have a different way of reporting – well, you know the rest. Thankfully, there is a tool that eliminates all of this headache and provides a seamless and fully integrated ad experience.
Q. Streaming TV is taking advertisements dollars. Is this an end to TV channels?
A. Let’s start by looking at both sides of the coin. One camp argues that TV channels (by TV, we mean linear TV) aren’t going anywhere, anytime soon – and that Streaming TV is complementary to linear TV rather than a substitute. TV advertising is no longer reserved for legacy brands like beer and consumer products – now, big tech companies like Google, Amazon and Microsoft are doling out the dollars to advertise alongside them. Industry data suggests that advertising demand on TV remains pretty flat overall and was estimated to hit $72 billion in 2020 but this year’s estimate is likely to fall short of that, since COVID-19 has impacted live sports – which is one of the biggest categories for advertisers. We also see a general decrease in ad spending on TV, due to newer players on the scene like streaming TV (otherwise known as Connected TV). This year also marks the first year where US TV’s share of ad spend will drop below 30% for the firs time – by 2022 it will drop below a quarter of total US ad spend.
Q. Are preroll ads effective marketing when it comes to streaming video content?
A. Nope. Studies show that 90% of people skip pre-roll video ads, and it’s only going to get worse as attention spans falter. Think about your own experience with these types of ads – are you really paying attention, or are you distracting yourself with another device until the ad is over so you can resume your original program? Our best guess is the latter – and the data fully supports it. In fact, we created a whole web experience around it, which you can learn more about here.
Don’t forget that video content goes beyond the traditional YouTube ads viewed on desktop or mobile – it also applies to streaming TV (otherwise known as Connected TV). In fact, studies show around 87% of consumers use a second screen when watching Connected TV and 86% of people always fast-forward through ads.
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