Compared to Amazon PPC, Amazon Demand-Side Platform (DSP) is a whole different ball game: you’re no longer playing with keyword and product bids, but now editing product creatives and fine-tuning audience targets to engage to customers that fit your demographic profile. From our in-house DSP experts, here are a few ways you can optimize your Amazon DSP campaigns.
TABLE OF CONTENTS
1. What is Amazon DSP?
2. Amazon DSP vs Sponsored Displays
3. Your Top-to-Bottom Guide to Optimizing Amazon DSP Campaigns
3.1. Define Campaign Objectives
3.2. Set a KPI Target
3.3. Allocate Budgets
3.4. Fine-Tune Your Audience Targeting
3.5. Consider Switching Ad Formats
3.6. Adjust Bids
3.7. A/B Testing
4. How VASO Group Helps You with Amazon DSP Campaign Optimization
What is Amazon DSP?
Amazon Demand-Side Platform (DSP) is an advertising platform that allows advertisers to programmatically buy display and video ad placements across Amazon’s ecosystem of websites, apps, and devices. Not to be confused with another Amazon initiative, the Delivery Service Partner Program (also abbreviated as DSP), Amazon DSP is a subset of Amazon Advertising, and is a solution for advertisers who want to take their marketing strategy to the next level.
How does Amazon DSP take it to the next level? Let’s think about the marketing funnel.
Amazon PPC, with its versatile capabilities including Sponsored Brands, Sponsored Products, and Sponsored Displays, allows advertisers to engage users on Amazon at every stage of the marketing funnel. However, Amazon DSP expands the top part of the marketing funnel by bridging the gap between advertisers and users both on and off Amazon. Casting a wider audience net opens up your customer reach, and as such, Amazon DSP advertising is super effective for elevating established brands on Amazon, helping them acquire new-to-brand customers and grow their base.
Amazon DSP vs Sponsored Displays
Think of Amazon DSP targeting as Sponsored Displays targeting, but much more sophisticated and granular. Amazon DSP targets audiences, similarly to Sponsored Displays, but it goes far beyond just product views and product purchases. It incorporates Amazon’s first-party data which includes shopping behavior, demographics, and interests to target highly specific audiences. Advertisers can also create custom audience segments or use predefined audience categories to reach specific customer segments both on and off Amazon’s platform. On the other hand, Sponsored Displays targeting focuses primarily on retargeting and audience-based targeting only within Amazon’s ecosystem.
Another advantage to using Amazon DSP versus Sponsored Displays is that you are allowed much greater flexibility when it comes to ad creatives. Amazon DSP supports a wide range of ad formats, including display, video, and audio ads. These ads can be placed across Amazon-owned properties (like Amazon.com, Kindle, and Fire TV) as well as third-party websites and apps. These ad creatives can be highly customizable and engaging, allowing for interactive elements and rich media experiences. While Sponsored Displays also allow some customization of the ad creative, its ad format remains relatively rigid as a pre-designed template, and you can only fill in the gaps by uploading the correct file types.
Your Top-to-Bottom Guide to Efficiently Optimizing Amazon DSP Campaigns
With many moving puzzle pieces, optimizing Amazon DSP campaigns can be a challenge if you don’t know where to start. At VASO, we recommend a strategy that blends both automatic and manual optimizations in order to save time for yourself while still achieving the most results.
Define Campaign Objectives
For lower-funnel tactics, you don’t want to work towards gaining more Impressions for your campaign when its sales are struggling. Knowing what you’re optimizing for is of the utmost importance.
Clearly define your campaign goals, whether it’s increasing brand awareness, driving product sales, or boosting customer engagement. Corresponding with each of these goals is a totally different KPI metric (Key Performance Indicator) that you’ll be optimizing your campaigns towards (Impressions, Sales, Clicks, etc.). Understanding your campaign’s performance priority allows you to focus on making the right decisions in the right areas.
Set a KPI Target
Once campaign objectives are defined and you’ve determined what metric matters most in your campaign performance, it’s time to set a KPI target. The target acts as a baseline to compare your campaigns’ actual performance against your desired performance. It also serves as a handy optimizing threshold so you know whether to pause or further fine-tune your campaign.
Allocate Budgets
Once determined, your yearly advertising budgets are set for each month, without rollovers. As such, you must make the best use of the full amount, or else you’re leaving money on the table. To optimize for budget utilization, ensure that your campaigns are delivering at 100% rate and make sure your budget is pacing correctly through the month. While it can be tempting to immediately course correct when your campaigns are under- or over-delivering, we recommend incrementally increasing or decreasing your campaign budgets until you reach a desired pace. This helps prevent overpaying for your clicks, or causing a sudden drop in performance from bumping/curbing spend too aggressively.
📝 PRO-TIP: To help maintain good campaign performance while still finishing your account’s budget at the end of the month, try enabling the “Prioritize spending full budget, while maximizing performance” option in the Amazon DSP order setup:
Fine-tune Your Audience Targeting
Use Amazon’s robust targeting options to reach your desired audience segments effectively. This includes targeting based on demographics, interests, purchase behavior, and Amazon shopping intent data. Continuously refine your audience targeting based on performance insights to reach the most relevant audience segments.
📝 PRO-TIP: Pay attention to un-targeted audiences who are purchasing your products and consider adding them as an overlapped audience in your settings.
Consider Switching Ad Formats
Test different ad creatives to identify which ones resonate best with your target audience. Experiment with different ad formats, messaging, imagery, and calls-to-action to optimize performance. Utilize Amazon’s creative analytics to track performance metrics and make data-driven decisions.
Adjust Bids
Monitor and adjust your base bid to maximize the efficiency of your ad spend. Think of your base bid as an optimization target for your AI, which constantly monitors both your audiences’ signals and your campaigns’ performance to make the best decisions. Defining a clear target for the automated optimization also helps put you in the driver seat, making sure the machine doesn’t underbid or overbid and affect your overall sales.
A/B Testing
Conduct A/B tests to compare different campaign strategies, targeting options, creatives, or bidding strategies. Test one variable at a time and measure the impact on key performance metrics to identify the most effective optimization tactics.
How VASO Group Helps You with Amazon DSP Campaign Optimization
Our marketing experts are certified in Amazon DSP advertising and always stay up-to-date on new updates and best practices. We can confidently recommend marketing strategies and optimization strategies for your account upon assessing the performance of all your ad vehicles.