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Amazon DSP: How to Target New Audiences On and Off Amazon

How can you increase brand awareness and attract new audiences when the average ad bid goes up each year, just like your number of competitors?

Did you know that in the e-commerce sector alone, there are 7.1 million companies that operate globally, and North America is home to 1.8 million of them. Yes, you heard that correctly. The forecasted revenue for all e-commerce companies in the United States combined is expected to reach $875.2 billion in 2022.

Year-over-year ecommerce companies' revenue
E-commerce market revenue

While using the most popular platforms, such as Facebook, Google Ads, and Instagram, to advertise their products, companies face intense competition and often overspend on underperforming ads.

So, how can you reach out to new audiences more effectively? The answer is obvious: try out new platforms.

Amazon DSP is a hidden gem for companies that want to expand their reach and scale their business. Samsung, Casio, and many other brands successfully use Amazon DSP to increase their online visibility and boost sales.

Let’s find out how Amazon’s programmatic advertising helps large companies achieve their goals and take a deep dive into some Amazon DSP advertising strategies.

Learn how to implement omnichannel marketing strategy and make the most out of each touchpoint of the customer journey

What is Amazon DSP?

💡 Amazon DSP is an advertising platform where you can programmatically buy display, video, dynamic, and other types of ads to reach new audiences, both inside and outside of Amazon.💡

🚀Here’s our top 12 programmatic advertising platforms for 2022🚀

Your ads will appear across Amazon’s wide media network. Here’s a list of places where prospective customers will see your ads:

Additionally, Amazon provides marketers with access to Amazon over-the-top advertising (OTT) on Amazon’s devices. For example, companies can put full-length, unskippable video ads on Fire TV devices that use TV and movie streaming services. Advertisers can also create accurate ads configurations and target specific audiences with OTT ads.

Why ignoring Amazon DSP is a mistake

Amazon DSP has taken a huge step forward in pinpointing target audiences and improved the convenience of ad placement compared to Amazon’s Sponsored Display. Let’s review each benefit this platform brings to advertisers.

Premium placement for the lowest price

The websites where Amazon will place your ads are huge. Twitch, IMDb, Goodreads, and Amazon itself have enormous daily traffic, which ensures the highest level of visibility for all of your creatives.

Another notable benefit is that you get all of this advertising potential for one of the lowest prices on the market. Amazon DSP uses a CPM revenue model. The cost per thousand impressions hovers at around £0.54 (~$0.73). Of course, the final price depends on the audience, region, and other factors.

🚀Read our digital math guide to better understand the CPM revenue model and other metrics🚀

Amazon DSP targeting segments
Amazon DSP audience targeting

Kiefer Godfrey, an expert in managing large marketing budgets for DTC brands, states that Amazon DSP isn’t a tool to be ignored.

First-party audience data

Another important factor is that Amazon provides access to its data. The platform stores extraordinary insights into customer purchases, preferences, spending broken down into product categories, and more.

Amazon DSP’s first-party data allows marketers to target audiences more precisely by basing their advertising campaigns on prospects’ spending behavior, purchasing power, and interest in the company’s product. This data makes campaigns more effective than PPC campaigns based on classic keyword research.

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Amazon sellers can create new audiences based on their prospects’ past product views, purchases, similar product views, and product searches over a certain period of time.

ASIN product targeting
ASIN product targeting

Moreover, the platform allows companies to build an audience based on any product available on Amazon. That means you can serve your ads to your competitors’ customers by simply inserting their product’s ASIN (Amazon Standard Identification Number). Basically, you can steal customers from other businesses, and they won’t even know it!

Joe Huber, commerce media director at Wunderman Thompson Commerce, explains how companies can effectively use Amazon DSP audiences to sell their products.

Amazon DSP Retargeting

Amazon’s demand-side platform can target users that have already interacted with your product page, brand page, or anything related to your company on Amazon.

That’s a massive game-changer for companies. Instead of reaching out to random audiences and pitching a product they might not need, companies can serve ads to users interested in the brand or related products.

Amazon DSP retargeting offers the following benefits:

  • Increased CTR. Users are more likely to click on your ads as they are interested in the product.
  • Higher ROAS. Unlike Sponsored Products, Amazon DSP generates leads that are more likely to purchase your product.
  • More traffic to your products. Amazon DSP serves ads on various platforms, meaning that your listing will draw more attention.

Creatives done in seconds

Amazon DSP offers an intuitive way to make different types of creatives. Video ads, dynamic e-commerce, creatives with custom images, and many other types of banners can be made in just a few clicks.

It means marketers no longer have to wait for videographers or designers to come up with a new banner. This feature significantly speeds up the time it takes for ads to reach your audience.

Plus, there are some great custom features, such as adding customer reviews to your ads. 

Amazon DSP ad creatives
Amazon DSP ad creatives

Who can use Amazon DSP?

The best features of this platform aren’t available to everybody.

One of the main requirements to use Amazon DSP is a large ad spend. Only companies with a minimum ad spend of $35,000 to $50,000 per month can access the platform. That means small Amazon seller accounts probably won’t use the platform due to low marketing budgets.

However, that’s not a surprise since the platform uses a CPM pricing model, implying that your spending will be higher compared to a standard CPC model.

You don’t have to be an Amazon seller to use Amazon DSP. However, Amazon sellers usually yield more profit from Amazon’s programmatic ads. It’s much easier to create an audience based on your competitors on this specific platform, and you also benefit from features such as automated creatives.

Still, non-Amazon companies also get their perks. For example, third-party websites can set up remarketing using Amazon DSP pixels.

Here’s what  a non-Amazon seller that uses Amazon DSP platform has to say about the platform:

How Amazon DSP targeting works

It’s finally time to dive deeper into Amazon DSP’s targeting options. Depending on their goals and type of business, marketers are free to choose different types of targeting.

Amazon DSP pixel-based targeting

Third-party e-commerce companies can retarget shoppers on Amazon who have previously interacted with their website. When the user leaves your website and continues browsing the web, pixels let Amazon DSP know it’s time to start showing ads.

Pixel-based targeting ensures that only users who interacted with your website before will see your ads. In this way, you can draw middle- and bottom-of-the-funnel leads back to your brand. Additionally, companies that don’t sell on Amazon directly can also benefit from Amazon’s first-party audience data.

But remember, Amazon has strict policies and guidelines regarding pixels, so get acquainted with those first.

Product (ASIN) targeting

Amazon DTC sellers can target users who have interacted with their product listings but didn’t make a purchase. As in the case of pixel targeting, this method also generates leads that have a higher intent to purchase.

But it’s far from being the limit of ASIN’s retargeting capabilities. Sellers can target customers who have already purchased a product after a certain amount of time has elapsed. This strategy is highly efficient for distributors of consumable goods, such as toothpaste, shaving foam, etc.

After some time, those customers will come back to refill their supplies, and your product will be in the spotlight.

Brand halo targeting

This approach focuses on targeting users who viewed items similar to yours or that are sold by a similar brand. Prospects from this group of customers may be actively searching for your product, but they don’t yet know that it exists.

This targeting method helps users find your product faster and purchase it.

The list goes on, as a wide range of targeting methods exist, such as targeting by device, lifestyle, location, behavior, and more.

For example, location-based targeting alone deserves recognition due to its extensive configuration capabilities. The screenshot below shows how marketers can target specific city areas based on their postal codes when displaying ads.

Location targeting in Amazon DSP
Amazon DSP location targeting

Amazon DSP ad types

Amazon DSP offers a variety of ad types that can be used at different stages of the customer journey and correspond to various use cases.

Dynamic e-commerce

Dynamic e-commerce ads automatically select the most suitable creatives depending on your campaign goals. This ad type has some killer features for companies that use Amazon as their primary distribution channel:

  • Automatic optimization. The algorithm automatically selects the best-performing products to advertise.
  • Supply management. The algorithm knows which items are out of stock and won’t display them to users.
  • Faster time-to-audience. The platform builds creatives automatically, so marketers can launch new campaigns up to 90% faster.
  • Ad placement. The algorithm chooses the best places to display ads, depending on the user behavior.

Static ads

This is the most common type of Amazon DSP ad that requires a call to action. It doesn’t have any dynamic elements, so you’ll have to make the creative by yourself.

Amazon serves these ads across desktop apps, browsers, mobile apps, and Amazon Kindle.

Marketers use static banners to route users back to product pages, Amazon storefronts, or custom landing pages.

The platform has its requirements in terms of the size of picture files, the format, and other factors. Be sure to comply with them when launching your campaigns.

Video ads

Amazon DSP video ads help advertisers to convey their brand message and values with autoplay videos across the Amazon marketplace and related platforms.

By default, Amazon provides a video ads template that includes the advertiser’s brand logo, a text headline, and a call-to-action button. If you don’t need anything beyond this set of elements, you can embed your video and jumpstart your campaign.

However, the platform also provides extended features, such as a custom background image behind the video player, to make your ad more sophisticated.

Over-the-top video ads (OTT)

We briefly mentioned OTT ads before. These ads reach audiences on connected TV devices (Amazon Fire TV Stick, for example). Advertisers can serve 5+ second video prerolls before users can access the content.

One of Amazon’s platforms, Twitch, serves mid-roll (during the live stream) unskippable ads to users on all kinds of devices. With First Impression Takeover ads, viewers will see your ads during their first broadcast of the day. Twitch provides a comprehensive guide on available ad types and all possible targeting methods.

Amazon DSP metrics

Now that you know how Amazon DSP works and what ad types are available, it’s time to talk numbers. Here are some key Amazon DSP metrics to track your campaign results:

Metric Description
Total Cost Your ad spend
Impressions How many times your ads have been served to the audience
Viewable Impressions The percentage of ads that are actually viewed by real people
evCPM Estimated ad spend per 1,000 impressions
CTR Clicks to impressions ratio
DPV How many times have prospects viewed the product page after interacting with an Amazon DSP ad
PRPV How many times have prospects viewed the product review page after interacting with an Amazon DSP ad
ATL How many times have prospects added your product to a wishlist after interacting with an Amazon DSP ad
ATC How many times have prospects added your product to the shopping cart after interacting with an Amazon DSP ad
Purchases How many purchases of the advertised product occurred after interaction with an Amazon DSP ad
Sales The dollar value of purchases occurred after interaction with an Amazon DSP ad
ROAS Sales divided by Total Cost
eRPM Sales per 1,000 impressions

Even though Amazon DSP provides a built-in reporting tool, its capabilities are quite limited. You can’t merge your Amazon DSP metrics with data gathered from other marketing channels, such as social media, blogs, PPC campaigns, etc.

Additionally, Amazon’s reporting capabilities don’t give you complete visibility of your efforts on platforms outside of Amazon. It’s almost impossible to track the customer journey with more than two touchpoints. Plus, the DSP solution offers the most basic visualization features, leaving no room for custom dashboards.

Another way to get real-time reports is to use ETL solutions.

Let’s look at ETL solutions using Improvado as an example. One of the reasons why Improvado is such an efficient tool for Amazon DSP is that it is an Amazon Ads partner. As a result, Improvado extracts all available metrics from Amazon DSP, Amazon Ads, and Amazon Attribution without any manual work.

What exactly are ETL platforms? With the help of predefined extraction patterns, an ETL platform extracts data from Amazon DSP automatically. An extraction template is created once, and it is run until manually stopped.

How a marketing ETL helps analysts with no coding experience

Marketing ETL tools like Improvado offer users a no-code workflow, meaning that analysts without programming expertise can set up the process by themselves without help from the engineering team.

Analysts can work in a spreadsheet-like UI with drag-and-drop functionalities, which replaces endless lines of code with user-friendly, straightforward features that enable analysts to do the same work much faster.

Data extraction
Improvado extraction workflow

Furthermore, an ETL platform automatically transforms raw data. The transformation process includes data normalization, deduplication, data mapping, clearing redundant data rows, and more. As a result, analysts can skip manual data harmonization activities and dive straight into reviewing their reports.

Delegate manual data transformation processes to Improvado

With automated data extraction and transformation processes, data analysts gain more time to work with insights and ensure that their predictions are accurate. In addition, they can focus on high-priority tasks instead of spending hours on the data preparation process.

Still, you need a solid tool to put it to work and see some results. If you don’t have one yet, give Improvado a try.

You can use Improvado to extract insights from 300+ marketing and sales data sources, including Amazon DSP. With its help, you can save a lot of time on manual data processes and continuously supply your dashboards with real-time data.

Schedule a demo to see Improvado in action and learn how it can accelerate your growth.

Get in touch with our analytics specialists to consult about automated Amazon DSP data extraction
Ali Flynn
VP of Customer Relationship

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