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Why You Should Use DSP Ads For Your Amazon Products
min read

Ready to take the next step in your advertising? DSP ads just might be for you.

What is Amazon DSP called?

Why You Should Use DSP Ads For Your Amazon Products
Julia Grant

December 7, 2021

Whether you are advertising your Amazon FBA product or another e-commerce offering, DSP ads are a great way to leverage Amazon’s insight into consumer behaviour to generate amazing results. If you’ve never heard of DSP ads before or are new to the concept, let’s unpack everything together.

GIF of a man excitedly pointing down.
Source: Giphy
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What Are DSP Ads?

DSP stands for “Demand Side Platform.” Amazon released DSP to help businesses with their online marketing and enable their own sellers with seller account (as well as sellers with their own business outside of their platform) to benefit from the massive trove of consumer research that is available to them.

Here’s how Amazon defines it:

Amazon's definition of DSP (demand-side platform) as per their website. "A demand-side platform is softwarre that provides automated, centralized media buying from multiple sources" (Amazon).
Source: Amazon

Are you still confused? Basically, DSP is a form of advertising in which Amazon pays for ad space all over the web and on devices that are not included in fulfillment fees. These can be in the form of audio ads, video ads, or display ads. Then Amazon populates those spaces with ads from FBA sellers like you with inventory performance index - but they determine where and how those ads are shown based on their own research data & product research.

In order to do this, Amazon uses programmatic advertising. Programmatic advertising is essentially automated advertising. Amazon controls the “advertising inventory” with excess inventory and uses algorithms to best award that inventory to the proper buyer willing to pay the fulfillment fee. You can think of “advertising inventory,” like the number of available billboards on any given highway. Unlike billboards, however, the content of these spaces online changes routinely and is driven by highly educated algorithms.

These algorithms consider things like:

  • Your base and max bid
  • Your budget
  • Consumer demographics
  • Target audience 
  • Keywords
  • And more

This means that by using DSP ads, your potential reach will grow dramatically - and the kind of consumers that you are able to reach with these ads is far more than what you could achieve using traditional Amazon marketing methods.

Amazon's definition of programmatic adversiting as per their website. "Programmatic advertising is the automated buying and selling of digital advertising inventory. Advertising inventory is the space for ads on a given website" (Amazon).
Source: Amazon

One of the coolest aspects of DSP ads is that they are placed all over the internet and across internet-enabled devices. That means that by using DSP advertising, you can have your ads reach people while they browse, surf, stream, or shop - without having to set up individual ad campaigns for each of those platforms.

What’s the Difference Between DSP and Sponsored Display Ads?

Amazon has been busy releasing a ton of new offerings, including Sponsored Display Ads. DSP and Sponsored Display Ads have a lot in common but are not the same. Here’s the difference.

  • It’s not only for Amazon sellers. This means that you can utilize DSP to draw consumers to your own website - not just your Amazon store.
  • There’s more requirements and better results. Sponsored Display Ads are like a JV version of DSP, and the requirements to use it are lower. Think of DSP as the varsity team of Amazon advertising.
  • You can customize your campaign more than with Sponsored Display Ads. You get to determine far more of the details about your DSP ad campaign than you do with traditional sponsored display ads. 
  • DSP reaches a larger audience. While both of these options provide advertising solutions off of Amazon, the capacity that DSP ads has is far greater. They have more digital space available to them.

Why Should You Use DSP? 

Amazon DSP is a great solution for both large-scale Amazon sellers and sellers whose retail space is off Amazon. If your marketing budget is not substantial, however, you will want to get your feet wet with something smaller scale. This FBA program is intended for those who have money to spend on marketing.

If Amazon fulfillment center is managing your ads for you - this is generally a $35,000 minimum spend marketing investment without any long-term storage fees. However, you can also use the self-service option and have an agency assist you with campaigns, and the minimum spending typically drops to around $25,000.

Amazon's breakdown of cost for DSP as per their website. "Pricing for ads through Amazonn DSP varies depending onn format and placement. Self-service customers are in full control of their campaigns, and there are no management fees. The managed-service option typically requires a minimum spend of $35,000 USD (minimum may vary per country)" (Amazon).
Source: Amazon
GIF of Andy Dwyer from Parks and Rec (NBC/Peacock) scratchingn his head and mouthing "oof."
Source: Giphy

The biggest thing that sets DSP apart from other marketing services is the fact that you get to capitalize on Amazon business’s marketplace knowledge, inventory management and their top quality algorithms to get your ads in just the right places for selling high-quality products.

As the largest e-commerce site in the world, they are the best suited to provide this kind of insight.

There are six ways that you can choose to target your ads to reach the ideal customer.

  • Remarketing. These ads are intentionally targeting those who have previously visited your content. Example: Someone browsed your brand page on Amazon but didn’t purchase anything. Your products are now popping up as ads while they browse.
  • Contextual Targeting. These ads are made to engage with what content consumers are presently consuming on the internet. For example an ad for your high-quality knife sharpener shows up while a consumer is looking up information for an online culinary course.
  • Behavioral Targeting. This targets audiences with a search history relevant to your product over the past month. Example: Jeff has constantly been searching for new workout equipment over the past month. Your high-end resistance bands are now popping up as he browses.
  • Advertiser Audiences. This form of targeting uses information that your brand has available. This could be a database, website analytics, email lists, and more. Example: Your web analytics help you target people like those who are already visiting your site.
  • Lifestyle Targeting. These ads target people who routinely purchase products that are similar to your own. Example: Joe buys dog products at least 2-3 times a month. Your customized dog apparel line begins showing up all over his devices as he browses.
  • Audience Lookalike. These ads target people who have a lot in common with your existing customers paying FBA fees. Example: Most of your customers are women aged 18-25. Your ads will be showcased to more women aged 18-25.

These are a lot of advertising options, and using Amazon’s insight and data to create this kind of unique targeting is priceless. 

Is It Worth It Financially?

GIF of a man pensively looking to the distance while holding his chin.
Source: Giphy

DSP is only worth it financially if you are already established as a seller and ready for the next steps. It is not meant to be a starting option for marketing online, and it is not intended for those with a low budget. 

That being said - if you have the budget for DSP outside of selling fees, it will always be worth it. You can see some of the amazing results that top brands have had using DSP on Amazon’s site. There truly is no better brand than Amazon to help inform your advertising with their top-quality marketplace insights. The seller central has proved themselves to be the most capable name in e-commerce, and there’s no good reason not to trust that. 

If you’re looking for the best way to take your sales to the next level - this is it! 

Source: Giphy

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Why You Should Use DSP Ads For Your Amazon Products

Julia Grant

Julia Grant is a copywriter specializing in e-commerce and small business, helping businesses expand their reach with copy that clearly communicates their message and converts. She is a certified translator and interpreter and prides herself on providing culturally relevant content in both English and Spanish.

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