Amazon DSP vs. Sponsored Ads: Key Differences Explained

What is Amazon DSP?

Amazon DSP stands for Amazon Demand-Side Platform. It’s a platform that allows advertisers to programmatically buy display, video, and audio ads to reach audiences both on and off Amazon.

Think of it this way:

1. Programmatic Buying: Instead of manually placing ads on specific websites, DSP uses technology and algorithms to buy ad placements across a vast network in real-time, based on specific audience criteria.
2. Reach Beyond Amazon: This is a key aspect. While it can place ads on Amazon.com itself, Amazon DSP’s primary strength lies in reaching audiences on:
   • Amazon-owned sites and apps: Like IMDb, Twitch, Fire TV, Amazon Publisher Services partner sites, etc.
   • Third-party websites and apps: Through connections with major third-party ad exchanges.
3. Advanced Audience Targeting: DSP leverages Amazon’s vast first-party data (what people browse, buy, watch on Prime Video, listen to on Amazon Music, etc.) to build highly specific audience segments. You can target based on demographics, lifestyle segments (e.g., “health enthusiasts”), in-market segments (e.g., “shoppers looking for TVs”), past purchase behavior, interactions with your brand/products on Amazon, and even lookalike audiences.
4. Ad Formats: It supports various formats like static display banners, dynamic eCommerce ads (showing specific products), video ads (in-stream and out-stream), and audio ads (on platforms like Amazon Music’s free tier).
5. Goal Focus: DSP is often used for upper and mid-funnel marketing goals like:
   • Building brand awareness.
   • Reaching new potential customers before they actively search on Amazon.
   • Driving product consideration.
   • Re-engaging past purchasers or website visitors (retargeting) across the web.
6. Management: Amazon DSP can be accessed via:
   • Self-Service: For advertisers or agencies who want direct control (often requires more expertise and potentially higher minimum spends).
   • Managed Service: Where Amazon’s team manages the campaigns for you (typically requires significant minimum ad spend commitments).

How Amazon DSP Differs from Sponsored Ads

“Sponsored Ads” is the umbrella term for Amazon’s pay-per-click (PPC) advertising solutions that run primarily within the Amazon marketplace (Amazon Seller Central) itself. These include:

• Sponsored Products: Ads for individual product listings that appear in search results and on product detail pages.
• Sponsored Brands: Ads featuring a brand logo, custom headline, and multiple products, appearing prominently in search results.
• Sponsored Display: Display ads that can appear on Amazon (product pages, search results) but also have some capability to reach audiences off Amazon (primarily through retargeting based on Amazon shopping activity). This is the closest Sponsored Ad type to DSP but still much more limited in scope and targeting options.

Here’s a table summarizing the key differences:

Feature	Amazon DSP	Amazon Sponsored Ads (Products, Brands, Display)
Primary Goal	Brand Awareness, Consideration, Reach (Upper/Mid Funnel)	Drive Sales & Visibility on Amazon (Lower Funnel)
Placement/Reach	On Amazon, Amazon-owned sites (Twitch, IMDb), Third-party websites & apps	Primarily on Amazon.com (search results, product pages). Sponsored Display has limited off-Amazon retargeting.
Pricing Model	Primarily CPM (Cost Per Thousand Impressions)	Primarily CPC (Cost Per Click)
Targeting	Advanced Audience-based (demographics, lifestyle, purchase behavior, lookalikes, contextual, retargeting across web)	Primarily Keyword-based, Product/ASIN-based, limited Audience-based (within Sponsored Display)
Ad Formats	Display (static, dynamic), Video, Audio	Search Text Ads, Product Listing Ads, Banner Ads (SB), Display Ads (SD)
Management Access	Self-Service (higher complexity/spend) or Managed Service (high minimum spend)	Self-Service within Amazon Advertising Console (accessible via Seller/Vendor Central), lower barrier to entry
Data Leverage	Deep Amazon 1st-party data + 3rd-party data for broad audience building	Primarily based on on-Amazon search terms and product interactions
Typical Use Case	Reaching broad or specific audiences across the web and Amazon properties; Branding; Retargeting off-Amazon	Driving immediate sales from shoppers actively Browse/searching on Amazon

In simple terms:

• Use Sponsored Ads when your main goal is to capture shoppers already on Amazon and drive direct sales for your products listed there. It’s focused on the point of purchase.
• Use Amazon DSP when you want to build brand awareness, reach potential customers before they even think of searching on Amazon, find new audiences across the web using Amazon’s data, or run sophisticated retargeting campaigns on and off Amazon using display, video, or audio formats. It’s often part of a larger brand-building strategy.

While Sponsored Display has introduced some audience targeting and off-Amazon capabilities to the Sponsored Ads suite, Amazon DSP remains a distinct platform offering significantly broader reach, more diverse ad formats, and more advanced audience targeting capabilities powered by programmatic buying.

Related reading: How to Set Up & Run Amazon Ads Campaigns (Seller Central)

Step-by-step practical guide to setting up an advertising campaign within the Amazon DSP

Here is a step-by-step practical guide to setting up an advertising campaign within the Amazon DSP (Demand-Side Platform), focusing on the self-serve interface.

Important Disclaimers:

• Access: Amazon DSP is typically available to larger advertisers or agencies meeting significant minimum spend requirements (often tens of thousands of USD/equivalent per month, though this varies). Access might be via a self-serve seat or through Amazon’s managed service. This guide assumes self-serve access.
• Complexity: DSP is considerably more complex than Amazon’s Sponsored Ads (found in Seller Central). It requires a deeper understanding of programmatic advertising concepts.
• Interface Updates: The Amazon DSP interface evolves. While the core concepts remain, specific button placements or menu names might change slightly over time.
• Goal Dependency: The optimal setup heavily depends on your specific campaign goals (awareness, consideration, purchase, etc.).

Phase 1: Prerequisites & Preparation

Before you even log into the DSP console:

1. Secure DSP Access: Confirm you have login credentials for the Amazon DSP self-serve platform or are working with an agency/Amazon account manager who does.
2. Define Clear Goals & KPIs: What do you want this campaign to achieve? (e.g., Increase Brand Awareness, Drive Detail Page Views, Maximize ROAS, Drive Purchases). Define specific Key Performance Indicators (KPIs) to measure success (e.g., Impressions, View-Through Rate (VTR), Click-Through Rate (CTR), Detail Page View Rate (DPVR), Purchase Rate, Return on Ad Spend (ROAS)).
3. Identify Your Target Audience: Who are you trying to reach? Develop detailed audience personas based on demographics, interests, shopping behaviors (using Amazon’s segments like In-Market, Lifestyle), and potentially your own data (website visitors, CRM lists).
4. Allocate Budget: Determine the total budget for this specific campaign (“Order” in DSP terms).
5. Prepare Creative Assets: Gather or create your ad creatives (images, video files). Ensure they meet Amazon DSP’s technical specifications and advertising policies (format, size, length, content restrictions). Allow time for creative approval by Amazon (can take 24-48 hours or longer).
6. Determine Landing Pages: Where will your ads send users? (e.g., Amazon Store page, specific ASIN product detail pages, custom landing page, your brand website).

Phase 2: Campaign Setup in the Amazon DSP Console

Log in to the Amazon DSP console (typically via advertising.amazon.com).

Step 1: Navigate to Your Advertiser

• The console usually opens at the “Manager” level if you have multiple advertisers. Select the specific Advertiser profile you want to work under.

Step 2: Create an “Order” (Represents your Campaign)

1. Find the section for “Orders” (often in the main navigation).
2. Click “New order” or a similar button.
3. Advertiser: Confirm the correct advertiser is selected.
4. Order Name: Use a clear, consistent naming convention. Include key details like Brand, Product/Campaign Theme, Goal, Region, Dates. Example: BrandX_SpringPromo_Awareness_IN_AprMay25_DSPOrder
5. Goal / Objective: Select the primary goal (e.g., Awareness, Consideration, Conversion). This choice often influences the available optimization settings and default KPIs.
6. Primary KPI: Choose the main metric the DSP should optimize towards, based on your goal (e.g., for Awareness: Reach or Impressions; for Consideration: CTR or DPVR; for Conversion: Purchases or ROAS).
7. Budget: Enter the total budget for this entire Order (campaign). You’ll allocate portions of this at the Line Item level.
8. Flight Dates: Set the overall start and end dates for the campaign Order.
9. Optional Fields: You might see fields for IO number (Insertion Order, for internal tracking/billing), Agency Fee, etc. Fill these if required.
10. Save the Order.

Step 3: Create Line Item(s) (Control Targeting, Bidding, Budgets within the Order)

• An Order contains one or more Line Items. Each Line Item defines a specific audience, targeting strategy, bid, and budget allocation. You might create multiple line items within one order to test different audiences or strategies.
• Navigate into the Order you just created.
• Click “New line item”.

1. Line Item Name: Again, use a clear naming convention detailing the specifics of this line item. Example: Audience-LifestyleGamers_Supply-AmazonO&O_Device-Mobile_LI
2. Line Item Type: Select the inventory type. Common options include:
   • Display: Standard banner ads (on/off Amazon).
   • Online Video (OLV): Video ads on websites/apps.
   • Streaming TV (STV): Video ads on streaming services/connected TVs (like Fire TV).
   • (Note: Avoid older types like AAP Mobile, Standard Display if listed, as they may be deprecated).
3. Goal / Optimization: This often inherits from the Order level but can sometimes be refined here. Choose how the DSP should optimize delivery for this specific line item (e.g., optimize for clicks, viewable impressions, video completions, conversions).
4. Budget & Pacing:
   • Budget: Enter the budget for this specific line item (must be within the remaining Order budget).
   • Pacing: Choose how the budget should be spent over the flight dates (e.g., “Evenly” distributes spend smoothly; “ASAP” or “Front-load” spends faster). Consider adding daily or flight caps.
5. Flight Dates: Set the start and end dates for this line item (must be within the Order’s dates).
6. Frequency Cap: CRITICAL SETTING. Limit how often a unique user sees your ads within a given period (e.g., 3 impressions per user per 24 hours). Prevents ad fatigue and wasted spend. Set caps at the line item level (and potentially review Order level caps if available).
7. Targeting – Audience: This is where you define who sees the ads.
   • Amazon Audiences: Browse and select pre-defined segments based on shopping behavior (In-Market, Lifestyle), demographics, viewing behavior (Prime Video), etc.
   • Advertiser Audiences: Use audiences you’ve created:
     • Pixel-Based: Retarget visitors from your website (requires Amazon Ads pixel setup).
     • ASIN Remarketing: Target users who viewed/purchased specific ASINs (yours or competitors’).
     • Hashed Audiences: Upload pseudonymized customer lists (CRM data).
     • Lookalikes: Find new users similar to your existing customers or converters.
   • Contextual Targeting: Target users based on the content of the page they are currently viewing.
   • Logic: Use “AND”, “OR”, “NOT” logic to combine or exclude different audience segments for precise targeting. (e.g., Target “In-Market for Laptops” AND “Demographic: Age 25-40” EXCLUDE “Purchased Laptop in last 30 days”).
8. Targeting – Supply / Inventory: Define where your ads can appear.
   • Sources: Choose from Amazon Owned & Operated (e.g., Amazon.com, IMDb), Amazon Publisher Services (curated high-quality third-party sites/apps), Third-Party Exchanges (broader web inventory). You can create allow/block lists.
   • Deals (PMP): If you have Private Marketplace deals set up with specific publishers, apply them here.
9. Targeting – Technology:
   • Device Type: Target Desktop, Mobile, Tablet, Connected TV, etc. (Consider creating separate line items for Mobile vs. Desktop for better analysis).
   • Operating System / Browser: Optionally refine further.
10. Targeting – Geography: Define the geographic location. Options vary but can include Country (e.g., India), Region/State (e.g., West Bengal), City (e.g., Kolkata), Postcodes.
11. Bid Strategy:
    • Bid Price: Typically set as a CPM (Cost Per Thousand Impressions). Enter your Base Bid and potentially a Max Bid.
    • Optimization: Select if you want the DSP to automatically adjust bids based on your chosen goal/KPI (e.g., goal-based bidding, prioritizing KPI target). Fixed bids are also an option for full manual control.
12. Save the Line Item. You often need to associate creatives before it can be fully saved or activated.

Step 4: Upload & Assign Creatives

1. Navigate to the “Creatives” section within your Line Item (or use the main “Creative Library” in the DSP).
2. Option A: Upload New: Click “New creative” or “Upload”. Select your image/video files. Ensure they meet all specs and policies. Submit for approval.
3. Option B: Use Builders: Use Amazon’s Video Builder or create Responsive eCommerce Creatives (REC) which dynamically pull content (images, price, reviews) from specified ASINs.
4. Option C: Use Existing: Select creatives already uploaded and approved in your Creative Library.
5. Assign: Once creatives are available and approved, go back to your Line Item(s) and use the “Assign creatives” or similar function to link the appropriate ad creative(s) to that specific line item. Ensure the creative format matches the line item type (e.g., assign a video creative to an Online Video line item).

Step 5: Review and Launch

1. Thorough Review: Go back through your Order and each Line Item. Double-check everything: names, dates, total budgets, line item budgets, pacing, frequency caps, ALL targeting settings (Audience, Supply, Geo, Tech), bids, and creative assignments.
2. Creative Status: Ensure all assigned creatives are approved. Campaigns/Line Items won’t run without approved creatives.
3. Activate: Once everything is confirmed, activate the Line Item(s). Depending on the setup, you might also need to ensure the parent Order is active.

Phase 3: Post-Launch Monitoring & Optimization

• Monitor Performance: Regularly check the DSP reporting dashboard. Track the KPIs you defined in Phase 1 (Impressions, CTR, VCR, DPVR, Spend, Purchases, ROAS, etc.). Analyze performance by line item, audience segment, creative, supply source, etc.
• Optimize: DSP campaigns require ongoing optimization. Based on performance data, you may need to:
  • Adjust bids up or down.
  • Refine audience targeting (pause segments, add exclusions, test new ones).
  • Shift budget between line items.
  • Pause underperforming creatives and test new ones.
  • Adjust frequency caps.
  • Refine supply source lists.

Setting up a DSP campaign is detailed, but following these steps systematically will help ensure all necessary components are configured correctly. Good luck!