What Is Amazon DSP? Comprehensive Guide (2023)

Overview

Amazon Sellers are constantly on the lookout for fresh and interesting methods to reach out to potential customers and boost conversion rates.

High-quality display advertising and video commercials ads are excellent ways to inform the audience about the fantastic items you have to offer. We have seen this with the rollout of Sponsored Brand Video Ads.

As a result, Amazon has developed its own Demand Side Platform (DSP).

Amazon DSP is a service that allows you to buy video and display advertising across Amazon internet and partnered properties. Amazon DSP provides two distinct features, first, it’s an automated programmatic ad buying platform across hundreds of websites, and two, it allows for advanced targeting possibilities based on Amazon’s own purchase data.

Amazon’s demand-side platform (DSP) may be the answer if you want to broaden your reach and appeal to new shoppers. This is an ad platform meant to attract off-Amazon audiences and get them to visit Amazon.

Amazon DSP Network and Exchange

Amazon DSP basically acts as Amazon advertising’s ad network and exchange. The reason why you can target your ads off Amazon is because of this ad network and exchange concept.

Using their ad network to create the supply, Amazon aggregates their own advertising placement on many Amazon-owned products, applications, and websites, along with the Amazon Supply Side Platform (SSP) called Amazon Publisher Services (APS).

By inviting non-Amazon-related web properties to participate in their ad network, Amazon DSP can provide advertisers (Amazon Seller/other DSP participants) with advertisements from off Amazon and on Amazon properties.

Because of the unique ad supply via their SSP, the impressions that advertisers may get through DSP are ad inventory that they cannot get in other exchanges

The ad exchange portion of this equation is how Amazon DSP allows for programmatic advertising via the use of computer software to automate the buying and selling of ads placements. The majority of the programmatic ads sold uses the CPM model. That is why Amazon DSP is priced in CPM (Cost Per Mile).

To summarize, Amazon DSP is a very different advertising model than Sponsored Ads. Amazon DSP aggregates ads supply as an ad network via APS. Then function as an ad exchange by allowing advertisers to bid on this supply via CPM.

What can you Target with Amazon DSP Ads

Unlike Sponsored Ads, Amazon DSP is an audience-based targeting. The targeting is more like Facebook than Adwords for example.

Thousands of customer segments, as well as insight into shopper purchase history and intent, are available through Amazon DSP, the category of audience target includes:

• Behavioural ➡️ Groups that have recently engaged in specific behaviors, such as purchasing or viewing similar things.
• Lifestyle ➡️ These customers are chosen based on their shared lifestyle. This entails focusing on clients that have similar profile features to your current customers or have expressed interest in brand-relevant areas.
• Contextual ➡️ Customers that browse websites that are thematically connected to your product and show an interest in it.
• Remarketing ➡️ Consumers who were on the verge of purchasing your product or a competitor’s product are targeted. Customers who have abandoned your goods in their shopping cart or added it to a wish list, for example.
• Audience Lookalike ➡️ Customers that behave similarly to certain groups are targeted. Customers of a brand or customers of a competition, for example.
• Advertiser Audiences ➡️ The advertiser’s existing assets, such as emails, phone number, pixels etc

Amazon DSP Ad Types

Display ads

When we think about Amazon Advertising, we typically think of onsite Ads. Amazon Display Ads come in a variety of sizes, shapes, and types, totaling seventeen variations.

Amazon Display Ads, in contrast to lower-funnel marketing efforts, give companies a wider reach because they include placements outside of Amazon, all over the internet.

Because the brand controls the creatives, they can offer a more customized, on-brand message.

There are three different sorts of Amazon Display Ads:

1. Display Ads on Website and Mobile

These advertisements show on websites, whether they are viewed on a desktop or a mobile device. This sort of ad offers the most variety in terms of ad size, with seven distinct sizes.

2. Mobile App & Banner Amazon Display Ads

These advertisements appear throughout Android, Fire Tablet, and iOS mobile apps. There are a total of four forms, three of which are banner-shaped.

This sort of Amazon display ad may also include “rich media” (advanced HTML elements like video and music), although they are only allowed on non-Amazon (third-party) websites.

3. Mobile Interstitials for Display Ads

Most apps support these advertisements, which take up the user’s mobile screen for a brief time before being removed by pressing the ‘close’ button in the top right corner.

Video ads

These are both Online video ads and OTT videos. Advertisers may use Amazon DSP to offer 5+ second in-stream and out-stream video advertisements in MP4, WebM, or FLV format.

1. OTT Videos

These OTT Ads for streaming TV programs appear before, during, or after the content is streamed. Because these adverts can’t always be skipped, they’ve usually watched all the way through. They show up on properties such as IMDb TV Original hit shows and movies, during live sports, like Thursday Night Football, across the top TV networks and broadcasters, and on the News app on Fire TV.

2. Online video ads

These videos ads display as part of the browsing experience. These online video ads are also referred to ‘outstream’ as in videos that aren’t part of an existing video and are used in Amazon Display Ads. For the time being, they are exclusively accessible through Amazon.

CTAs should be addressed immediately because the suggested length of the video ad is between 15 and 30 seconds.

Difference Between Sponsored Display and DSP

It’s important to distinguish Amazon DSP from Amazon’s new Sponsored Display advertising, which includes audience targeting capabilities as well as the ability to reach consumers both on and off Amazon.

Sponsored Display is a pay-per-click (PPC) advertising product that you manage yourself. To utilize Sponsored Display advertising, you must sell items on Amazon, and the ads are linked to your Amazon listing page.

When you run out of inventory on Amazon the Sponsored Display ads will immediately cease running; this is not the case with DSP, which allows you to buy ads programmatically, including display ads. Therefore your ads on DSP will not be linked to your Amazon selling account.

Sponsored Display campaigns often target the middle to bottom of the funnel. These ads are usually designed to encourage people to buy things on Amazon. DSP advertisements may be used across the whole advertising funnel, from awareness to purchase, and aren’t just for boosting Amazon sales.

Your Amazon DSP ads objective might be as simple as leveraging Amazon’s customer data to increase off-Amazon awareness or conversions. Your range of objectives as a marketer is higher with DSP.

A good example of the relationship between Sponsored Ads and Amazon DSP is like this:

Amazon DSP is like the billboard advertisement you see out of the store, while Sponsored brands are more of an in-store ad that tells you the product selection of the brand (cardboard display is a good example of this) and finally Sponsored Products are like the coupons you can clip beside the price tag.

What are the ways to use Amazon DSP

Retargeting

Retargeting is the practice of presenting product ads to people who have already expressed an interest in buying your brand/product.

You can utilize the retargeting audience to target customers who have visited your brand’s website or Amazon Brand Store, or who have looked at your product’s Product Details page on Amazon but did not buy it.

This retargeting reminder is probably the lowest-hanging fruit. Retargeting audiences are the most likely to convert compared to other audiences.

Main KPI will be on sales increase due to the direct association with purchase intent, and it is the lowest funnel goal for Amazon DSP Advertising.

Brand Awareness

While retargeting can help raise brand recognition among customers who have previously indicated an interest in your product, you can also want to reach out to new customers who aren’t sure they want it.

What is the significance of brand awareness?

More users at the top of the funnel imply that there will be more towards the bottom. While it may not seem a high priority, the fact is that the best-performing Amazon sellers address the whole funnel in their digital strategy.

Because of the platform’s naturally competitive environment, this is especially crucial on Amazon Marketplace.

A good ‘awareness’ level tactic is similar to knocking out your opponents before entering the ring.

Data

Obtaining the crucial Amazon data can also be a DSP objective.

Your DSP ad data might reveal a lot about your consumers. Knowing more about your consumers may also help you develop a more effective marketing plan overall.

For example, you might be interested in knowing that there is a cross-segment of customers that are interested in Sci-Fri and Baseball.

Finally, the information collected may be utilized to guide larger-scale marketing decisions such as brand positioning, as well as more immediately applicable marketing decisions such as appropriate PPC targeting keywords and ASINs.

How Much is it to Access Amazon DSP?

Enterprise self-service and Amazon’s managed-service are the two main ways to access Amazon DSP.

Amazon DSP Self-Service

To get this service you need to be doing $25M in DSP spends annually to get onboarded.

The self-service DSP option is ideal for businesses that have seen success with their Amazon advertising and want to expand their reach beyond Sponsored Products, Brands, and/or display. In this option, you have access to a DSP account controlled by your or the agency that you hire.

Amazon DSP Managed Service

To get started with Amazon DSP’s managed-service option requires a minimum ad spend of $35,000 – $50,000/Month.

It operates totally in the background and is overseen by Amazon staff tasked with identifying the most effective advertising audience for you. This allows you to run advertising on Amazon Marketplace, Kindle, Fire TV, Twitch, and other off-Amazon sites all across the web.

Is it worthwhile to advertise on Amazon’s DSP?

Amazon DSP is best viewed as the “next step” for a well-known brand, product, or service. This real-time bidding mechanism is unlikely to be a suitable fit for a brand-new Amazon seller.

In reality, Amazon DSP is likely overkill and prohibitively expensive for most sellers. These sellers would be better off using Amazon PPC software such as SellerMetrics

If your brand is more established, you have more capital, and you want to expand your advertising beyond Amazon Sponsored Products and Sponsored Brands, Amazon DSP could be the ideal next step for you.

Conclusion

Amazon DSP isn’t a silver bullet for Amazon advertising, but it’s a terrific scalable complement to what you’re already doing with Amazon Advertising (PPC), allowing you to target customers using Amazon’s algorithms and enormous customer database.