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What is Amazon DSP (Demand Side Platform)?

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Ihor Dubovetskyi on Jul 06, 2022 in Step by Step Guides

What is Amazon DSP and How It Works?

 

Over some time, advertising on Amazon conveys how important an external promotion is for sellers who have intentions to expose their brands and products to a new and broader audience. Amazon Attribution, a recent addition to Amazon tools, is an effective follow-up to other off-Amazon advertising solutions like Amazon DSP.

Since Amazon DSP has a complex structure that thoroughly differs from Amazon PPC ads, let’s grasp the basics of this ad type and learn more about its tricky turns to understand how Amazon advertisers can benefit from this feature. 

 

Table of content:

 

What is Amazon DSP?

Amazon DSP is a platform that enables advertisers to programmatically buy display, video, and audio ads to be able to reach an audience on Amazon and third-party platforms.

Amazon Demand Side Platform uses Cost per Thousand (CPM) pricing model. It means that advertisers pay per thousand impressions, unlike Pay-per-click (PPC) pricing model that allows advertisers to display their ads paying for each click customers make within their ads.

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Amazon DSP Placements 

The places where Amazon Demand Side Platform ads appear are:

  • Across Amazon pages: homepage, product detail page, deals page, search result page, etc.
  • On Amazon devices: Fire TV, Fire tablet, Kindle, etc.
  • On Amazon-owned websites: Goodreads, IMDb, Audible, Twitch.tv, etc.
  • In Amazon apps
  • Across the entire internet

 

Amazon DSP Benefits

Considering a common misconception that Amazon DSP advertising is just another name for Sponsored Display ads due to its displayed features and some common placements where DSP appears, it’s important to dispel this myth by distinguishing particular qualities of DSP. Let’s break down the Amazon DSP benefits to understand what makes these ads special.

Amazon DSP Benefits

 

  • Unique targeting options

Comparing traditional Amazon PPC ads to DSP, Amazon DSP has a wider range of targeting options that includes In-Market, Lifestyle, Remarketing, Contextual, Audience Lookalike, and Advertiser Audiences. Since Amazon sellers are aware of the importance to reach newer and bigger audiences, the benefit of an extended targeting options list is extremely valuable. The details about each targeting type will be described below.

 

  • Targeting beyond the borders (cross-channel shopping)

Besides the fact that DSP users can display their ads to the relevant viewers on and off Amazon, they can also engage sellers in cross-channel shopping through creating cross-channel campaigns. This way, customers can see ads wherever they go and be redirected to the platforms where they can purchase the advertised items.

 

  • Amazon DSP inventory access

Here is what they say: Amazon DSP inventory access is the highway to success. There are three sources Amazon obtains information from to reinforce DSP targeting methods with precise data about customer behaviour: Amazon-owned and operated properties, Amazon publisher services, and third-party exchanges. 

With such an extended data inflow, advertisers get insights about interest in their products that, with the proper organization, can be used to target the right groups.

 

  • Audience Insights and Campaign Performance Analytics

Luckily for Amazon DSP users, the benefits of this advertising type don’t end here. DSP advertisers have access to the audience insights data and campaign performance data that provides essential information about purchasing behaviour. Sellers have an overview of customers’ actions before, during, and after the campaign in the report. The metrics involved in the reporting are: add to cart, total purchases, etc.

This is the closest advertisers can get to the truly relevant audience and the best way to find out at what point customers stop before accomplishing the purchase.

 

  • Amazon DSP ads specifications

Since the phrase Amazon DSP represents a spectrum of ads on an unending number of platforms and multiple numbers of devices, DSP advertisers are obligated to get familiar with Amazon DSP ad dimensions and specifications. Amazon DSP Specs are arranged by the devices where ads appear and include all the requirements, creative guidelines, ad sizes, and formats sellers need to consider.

 

  • Developing brand awareness

The paragraph about brand awareness most certainly shouldn’t be the last one in the list of Amazon DSP benefits due to the significance of this matter. Just like Sponsored Brands, DSP aims for brand awareness development. 

However, unlike Sponsored Brands, DSP has the power to remind customers about your brand or introduce your brand on the third-party platforms to the new audience that researched the web for the competitors’ products. It’s necessary because, for example, customers might not return on Amazon for some time because they forgot, and they need to be reminded about the item they wanted to purchase some time ago.

 

Amazon DSP Targeting Options

Amazon DSP Targeting Options

 

  • In-Market

The first described targeting option refers to the group of sellers that highly intended to buy items in your subcategory in the previous 30 days.

 

  • Lifestyle

Lifestyle targets customers that have an interest in the similar to the advertised brand categories or have common characteristics with already existing brand buyers.

 

  • Contextual

The context of contextual targeting is that the group of people who have lately browsed for similar products are the target.

 

  • Remarketing

Amazon DSP campaigns that are built on remarketing target potential buyers who browsed for your or competitors’ products, viewed or purchased them already before.

 

  • Audience Lookalike

This targeting type is made to display ads to the viewers with customers’ behaviour alike to the existing buyers of your brand or competitors’ customers.

 

  • Advertiser Audiences

Sellers provide the lists of relevant groups themselves.

 

Amazon DSP Creative Editing

DSP creative type advertisers pick defines the ad type. The range of choices for creative assets includes a custom image, a video, a review (only possible with more than 15 reviews and a rating of above 3.5 stars), etc. All the creatives’ measurements like required creative dimensions, file weight, file format, guidelines, and recommendations are provided here.

The Amazon DSP Creative Editing

 

Responsive eCommerce is one of the offered to the advertisers’ creative type options. It’s a type that allows selecting up to 10 supported sizes of the ad on and off Amazon.

Similar to any other advertising, DSP assets have to be catchy and appealing to its viewer. Whatever ad type or size you choose, consider its placement and think what would attract viewers’ eyes.

 

Available Amazon DSP Ad Types

Amazon DSP presupposes four ad types. Sellers can choose the most suitable type based on their goals.

 

  • Static Ad Type

Static ads are created to encourage instant action from those in front of whom the ads are displayed. The main static ads’ features are a call-to-action, a picture, brand name, and logo. By clicking on the ad, potential customers are redirected to your website, product listing, or Amazon Brand Store.

 

  • Video Ad Type 

Obviously, a video ad includes video and brings your customers to the Amazon product detail page or your website. Video ads might be the most efficient product promotion because of their ability to display products’ functions, relevancy to certain life situations, and the way people use the items. 

Amazon DSP video Ad Type

dsp Video Ad Type

 

Sellers can upload self-made videos or use Video Builder, which allows them to choose several templates and adjust them. There are also options for animation format, music, logo, etc.

 

  • Dynamic Ad Type

The magic of dynamic advertising is that its content is automatically chosen by Amazon due to the targeted audience. What a relief for advertisers that don’t have time to analyze DSP reports and think which creative asset will encourage product purchase.

Dynamic Ad Type

 

DSP Dynamic Ad Type

 

  • Over-The-Top Video Ad Type (OTT)

This is advertising created to be displayed on TV like Amazon Fire TV Stick. Over-The-Top ads don’t direct viewers to product detail pages or websites. They are strictly developing brand awareness.

 

Amazon DSP Costs

It might come as a surprise, but the Amazon DSP managed-service option requires $35,000 as a minimum total ad budget. Especially such costs can be shocking for advertisers that are used to pay-per-click ads. The required costs vary depending on the ad format, placement, and region.

 

Amazon DSP vs. Sponsored Display Ads

Finally, the time has come to answer the question: what is the difference between Amazon DSP and Sponsored Display ads? Judging just by the look, it’s not that easy to tell the difference. The resemblance is visible.

Besides the costs, a very important distinction of Amazon DSP is targeting. While the wide variety of DSP targeting options was described above, Amazon DSP gives advertisers only a choice among product targeting, audiences: views remarketing, and audiences: interests. Also, Sponsored Display lacks placements compared to Amazon DSP.

 

Getting Started with Amazon DSP Advertising

To have an easy start with Amazon DSP advertising, first, you need to decide between Managed-Service and Self-Service. 

If you want Amazon to manage your DSP, then Managed-Service is your choice. In this case, you need at least $35,000 in ad spend. Within this option, Amazon offers consulting, plenty of insights, necessary data, cookie-cutter service, and a DSP advertising plan.

The opposite proposal is self-service. The phrase self-service in reference to Amazon DSP means handing over the reins to the certified Amazon advertising agency. The big advantage of this option is a thoroughly managed advertising process by advertising experts. It also takes off the pressure from advertisers’ shoulders and the weight of responsibility about advertising performance. 

Profit Whales is exactly one of such advertising agencies that are certified to develop an excellent DSP structure to magnetize as interested customers as possible whose interest will convert into sales. 

Unlike Amazon, which provides certain DSP services only with $30,000-40,000 ad spend depending on the country, Profit Whales takes over DSP management with $5,000 in ad spend. Furthermore, it’s not just partial responsibility for your advertising performance—however, complete setup and management.

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