The Basics of Amazon DSP

January 17, 2024
The Basics of Amazon DSP

What is Amazon Demand Side Platform (DSP)?

Amazon Advertising is booming as more brands dive into self-serve Sponsored Ads. Competition for search terms is at an all-time high as we all fight for impressions that may lead to a sale. So what do you do when you feel like you have capped out your potential with self serve Amazon Sponsored Ads?

“If Amazon Advertising is a 95 Honda Accord, then DSP is a Tesla Model S…All of the power, control, and unprecedented potential that you could imagine.”
Check out DSP!

The Amazon DSP provides a brand with an opportunity to further develop their Amazon marketing advertising strategy through advanced targeting, precise Amazon audience control, and more display ad placement through Amazon’s O&O (owned-and-operated) inventory.

So What is Amazon DSP?

YES!Sponsored Display Ads Campaigns are self-service, no minimum, low barrier to entry, and easy to build. The ease of use and simplicity of these campaigns are both their strength and their downfall.Amazon DSP ads, on the other hand, give us the control and the precision that we are missing from Sponsored Ad Display.With DSP we can decide who, what, where, and when you serve ads….Making DSP unlike any other marketing channels available on Amazon!But before diving into DSP, you need to understand what your advertising goals are, and what type of consumers you want to target.To do this, we want to take a look at your customer journey or “funnel” ⬇️

This will help you communicate your goals with your DSP provider, as well as understand the KPI’s that you’ll need to look at, and what type of performance can be expected!

Brand Awareness 💡

Customers are in the target audience, but not engaged in the aisle. Customers don’t know you exist, but you want to make them aware of your brand.

Awareness Metrics

Searches, Click-Throughs & Click-Through Rate

Consideration ⚖️

Customer is considering the type of product they want. Shoppers are engaged in the aisle but not browsing or purchasing your brand yet.Consideration Metrics: Detail Page Views & Total Detail

Page View Rate

Purchase Intent 🛒

Shoppers are browsing your brand but have not yet made a purchase. Customer is comparing you with competitors.

Purchase Experience Metrics

Add to carts, & Total Add to Cart Rate

Purchase Evaluation 🧠

Customer reviewing the product before inevitable category purchase.

Purchase 💸

Customers are converting on your Amazon FBM listing.Example: “I am clicking to purchase right now”

Purchase Metrics

Purchases, Total purchase rate, Sales

Loyalty 🔂

Customers are purchasing your brand but have not signed up for automatic purchases or Subscribe & Save offers“I am writing a review because I love this product, I also want to subscribe & save and get this again next month”

Loyalty Metrics

Subscribe & Save Rate

So now that we have decided WHO we want to target, we can decide HOW we want to target them.

A beloved function of this tool is the ability to serve relevant Amazon DSP ads to our relevant audiences. To better understand why this is so powerful, here are some examples of audiences we can leverage to drive additional sales & nudge new-to-brand customers into our customer funnel.Some of the Amazon audience targeting we love!

The availability of so many targets is an advertiser’s dream but all these options may create a feeling of audience overload. We suggest starting small by running tests on Amazon shoppers who have viewed or purchased your product, then you can begin layering in some of the other options as you get comfortable with the results.

Now that you have decided your campaign’s goals through the customer funnel AND chosen your audience, you are close to being ready for your first Amazon DSP campaign!

What Else do you Need to Know?

You do NOT own the data with DSP – it is on a completely different platform than your Seller Central or Advertising Console.

  • You typically need to have Amazon run your DSP (Usually with a 35k spend minimum) OR you can work with a DSP provider (Usually can offer lower ad spend minimums)
  • Not owning the data can also make transferring agencies a bit complex because you will lose all of your prior optimizations and progress.

Solidify your Amazon ad goals before jumping into DSP

  • Sole focus on re-marketing may not increase your top line sales
  • Moving up the funnel means shifting focus from profitability to longer term brand goals.

Understand that DSP is a completely different fee structure

  • Industry standards average around 25% of your spend being dispersed in fees.
  • The Amazon platform typically requires a 35k ad spend minimum but agencies can typically require less

Attribution Methodology – 14-day, Last-Touch Model

  • Last touch means the last viewable impression receives credit for the conversion. Clicks always trump views.

DSP is NOT for those looking to achieve instant gratification.

  • Drastic changes in targeting and advertising strategy affect performance of DSP.