What Is Amazon DSP And How Does It Work?

Amazon Demand-Side Platform (DSP) is the automation software that allows businesses to buy display and video ads to show to relevant audiences, on and off the marketplace, all without the need for manual purchasing. Using Amazon DSP, advertisers can reach these audiences based on their shopping habits, interests, and demographics, resulting in highly targeted campaigns.

Here’s what we’re going to discuss in this post: what is Amazon DSP, how does it work, and how is it different from other Amazon advertising? We’ll also discuss what, precisely, it is, why it can be helpful, and whether there will be a good reason to factor it into your marketing strategy, plus how working with Mercatus can add you even more access to this dynamic.

What is Amazon DSP?

Amazon DSP — the service used by Amazon to programmatically sell display, video and audio ads on and off Amazon’s platform — gives advertisers access to its retail data, which can be helpful for targeting customers. With Amazon DSP, businesses can target customers based on shopping behaviour, demographics and interests, reaching potential buyers not only on the site owned by Amazon but on third-party sites and apps.

It boasts advanced targeting options, detailed reporting tools, and control of its proprietary Amazon audience data, enabling hyper-targeted campaigns. By using Amazon DSP, businesses can grow their advertising efforts and maximize the efficacy of their digital marketing initiatives.

How does Amazon DSP work?

Amazon DSP allows advertisers to programmatically buy ad inventory with automated technology that places ads on Amazon’s vast network of sites and beyond on external websites. Advertisers then use the platform to establish campaigns and select which targeting criteria they want to meet, choosing from audience segments, interests, behaviours and demographic data.

Thus, Amazon DSP leverages that data to serve highly targeted ads for optimal users. By leveraging Amazon’s vast shopping data, the platform ensures the ads are shown only to high-intent browsers who are more likely to convert. With real-time reporting and analytics, advertisers can also adjust their strategy on the fly, significantly improving efficiency with ad spending and meeting their marketing goals.

How is Amazon DSP different from traditional Amazon advertising

Unlike traditional Amazon advertising, Amazon DSP is a programmatic, data-first ad-buying platform that extends to a larger ecosystem beyond Amazon, such as third-party websites and apps. In contrast to traditional Amazon ads, such as Sponsored Products and Sponsored Brands, which are confined to Amazon’s properties, DSP enables advertisers to target audiences on and off Amazon. 

DSP utilises more sophisticated targeting since it utilises Amazon’s extensive consumer behaviour and shopping data to segment audiences more accurately. Traditional ads serve based on keywords and product positioning in Amazon’s marketplace, whereas DSP provides all the tools for advertisers to deliver cross-channel campaigns, maximising impact using display, video and audio ads for a more unified marketing effort.

What are the benefits of Amazon DSP?

Advanced targeting capabilities

Amazon DSP includes powerful targeting features that are much wider than just keyword-based targeting. Advertisers are able to target specific audience segments based on shopping behaviour, demographics, interests, and past interactions with Amazon products. By taking its wealth of data from Amazon into consideration, the platform recognises shoppers with high intent and targets ads accordingly, helping you reach the most pertinent audience for your business. 

This level of targeting results in greater conversion rates and more successful ad campaigns. Data-driven advertising helps businesses identify trends, make data-based decisions, and be more resourceful in their advertising strategies, thereby maximising return on investment (ROI) in their digital marketing initiatives.

Access to Amazon’s first-party data

One of the notable benefits of Amazon DSP is its access to Amazon’s proprietary first-party data. Such data can encompass consumer purchasing behaviour, browsing history, and demographic information, thus allowing advertisers to get a clear picture of their audience’s preferences. This way, businesses can build more relevant ad campaigns that resonate with potential customers based on their inferences. 

Amazon DSP provides advertisers with that same level of data-driven precision that is only otherwise available on a handful of ad platforms and can be powerful when it comes to making your ads much more relevant and, ultimately, yielding higher levels of engagement. Leveraging information from Amazon can help boost more effective and focused campaigns.

Cross-channel advertising

Unlike traditional Amazon advertising, which is shown only on Amazon’s own platform, Amazon DSP enables advertisers to run cross-channel campaigns. Not only can ads show up on Amazon, ads can also show up on third-party websites, mobile apps and other digital properties through the Amazon advertising network. 

The widespread reach allows businesses to engage with potential customers at different touchpoints, resulting in improved brand visibility. This makes cross-channel advertising one of the most comprehensive marketing strategies, offering businesses a way to reach their target audience during the different stages of their buying journey and enhancing their overall advertising efforts.

Comprehensive reporting and analytics

Amazon DSP offers robust reporting and analytics tools to help advertisers monitor the effectiveness of their campaigns in real time. Detailed insights enable businesses to track key performance indicators (KPIs) such as impressions, clicks, conversions, and return on investment (ROI). 

Detailed performance data allows advertisers to quickly understand what’s working and what needs to be tweaked for even better results. By providing insights into audience behaviours, ad placement successes and failures, and budget distribution, businesses can make data-centric choices that improve their advertising strategy and optimise their ad spend.

Is Amazon DSP worth it?

Amazon DSP could be extremely beneficial for businesses trying to scale their digital spend, especially those trying to reach customers in the market. This includes access to Amazon’s wealth of first-party data, sophisticated targeting options, and the option to implement cross-channel advertising, which provides unparalleled precision and reach when compared to more traditional forms of advertising.

Building on these benefits, organisations that partner with Mercatus gain even more by integrating their existing systems with Mercatus, which enables direct access to Amazon DSP and other robust marketing platforms. Mercatus guarantees that your campaigns will be strategically optimised for performance, leading to greater efficiency and return on investment; we provide tailored solutions and achieve more than what you’d get in-house.