Amazon DSP Advertising: The Complete Guide for Brands Ready to Scale

Amazon DSP (Demand Side Platform) advertising is Amazon's programmatic ad system that lets brands buy display, video, and over-the-top (OTT) ads both on and off Amazon. Unlike Sponsored Products or Sponsored Brands, DSP does not require a click to generate value. It builds awareness, retargets shoppers who viewed but did not buy, and reaches audiences across the entire internet using Amazon's first-party shopping data. At Marknology, our Kansas City-based team has managed DSP campaigns for brands doing $1M to $100M+ in annual Amazon revenue, and the results consistently outperform what Sponsored Ads alone can deliver.

Andrew Morgans, founder and CEO of Marknology, has talked about DSP on the Startup Hustle podcast: "DSP is where you stop playing defense and start playing offense. Sponsored Ads capture existing demand. DSP creates new demand. That is the difference between a brand that plateaus at $5M and one that breaks through to $20M."

What Is Amazon DSP and How Does It Work?

Amazon DSP is a demand-side platform that allows advertisers to programmatically buy display, video, and audio ads. The key difference between DSP and self-service Sponsored Ads is that DSP uses Amazon's massive first-party shopper data to reach audiences both on Amazon properties (the marketplace, IMDb, Twitch, Fire TV, Alexa) and across thousands of third-party websites and apps through Amazon's publishing network.

Here is how it works at a high level:

1. You define your audience segments using Amazon's shopping behavior data (past purchases, browsing history, search patterns, lifestyle affinities)
2. You create display or video ad creatives that align with your brand messaging
3. Amazon's algorithm serves your ads programmatically to those audiences across the web
4. You pay on a CPM (cost per thousand impressions) basis, not per click
5. Amazon tracks the full funnel from impression to detail page view to purchase

The power of DSP is that you are leveraging data that no other platform has. Google knows what people search for. Facebook knows what people like and share. Amazon knows what people actually buy. That purchase intent data is what makes DSP so effective for brands selling on Amazon.

How Is Amazon DSP Different from Sponsored Ads?

This is the question every brand asks first, and the answer is simple: Sponsored Ads capture demand that already exists. DSP creates demand that did not exist before.

Sponsored Ads (PPC)

• Self-service, available to any seller or vendor
• Keyword and product targeting
• Pay per click (CPC model)
• Ads appear only on Amazon search results and product pages
• Best for bottom-of-funnel conversion

Amazon DSP

• Managed service or self-service (requires minimum spend or agency access)
• Audience-based targeting using Amazon shopping data
• Pay per impression (CPM model)
• Ads appear on and off Amazon across the web, apps, Fire TV, Twitch
• Best for top-of-funnel awareness, mid-funnel consideration, and retargeting

At Marknology, we run both simultaneously. Sponsored Ads are your everyday bread and butter. DSP is the growth accelerator you layer on top once you have a solid foundation.

Think of Sponsored Ads like fishing with a line. You catch one fish at a time. DSP is like casting a net. You are reaching thousands of potential customers who did not even know they needed your product yet.-- Andrew Morgans, Marknology

Who Should Use Amazon DSP Advertising?

DSP is not for everyone. If you are just launching on Amazon with a $10K monthly ad budget, DSP is probably not the right move yet. Here is who gets the most value from it:

• Brands doing $1M+ annually on Amazon who have maxed out Sponsored Ads efficiency
• CPG brands launching new products and needing mass awareness
• Brands with high LTV where the initial acquisition cost can be justified by repeat purchases
• Companies running off-Amazon marketing (social, TV, influencer) who want to retarget that traffic
• Brands in competitive categories where organic visibility alone is not enough
• Enterprise brands and vendors who need full-funnel measurement

If you are not sure whether DSP makes sense for your brand, book a strategy call with the Marknology team. We will give you an honest answer.

What Types of Ads Can You Run Through Amazon DSP?

Display Ads

Standard banner ads that appear across Amazon.com, IMDb, third-party sites, and mobile apps. These can be static images or responsive e-commerce creatives that pull your product image, price, reviews, and Prime badge automatically.

Video Ads

15- to 30-second video ads that play on Amazon-owned properties (IMDb, Fire TV, Twitch) and across premium publisher sites. Video is the highest-impact DSP format and ideal for brand storytelling.

OTT (Over-the-Top) Ads

Full-screen, non-skippable video ads delivered on streaming platforms through Fire TV. These are basically TV commercials powered by Amazon data. They are premium inventory with premium CPMs, but the targeting is light-years ahead of traditional TV.

Audio Ads

Ads delivered through Amazon Music's free tier. Still relatively new but growing fast, especially for brands targeting younger demographics.

How Does Amazon DSP Audience Targeting Work?

This is where DSP gets truly powerful. Amazon's audience targeting options include:

• In-Market Audiences: People actively shopping for products in your category right now
• Lifestyle Audiences: People whose long-term shopping patterns indicate affinity (e.g., "health-conscious parents")
• Remarketing: People who viewed your product, added to cart, or purchased from you in the past
• Competitor Conquesting: People who viewed or purchased competitor products
• Lookalike Audiences: People who look like your best customers based on purchase behavior
• Advertiser Audiences: Your own first-party data (email lists, website visitors) uploaded to Amazon

The retargeting capability alone is worth the price of admission. At Marknology, we have seen brands recover 15-25% of abandoned detail page views through DSP retargeting campaigns. These are shoppers who were interested but needed one more touch.

How Do You Set Up an Amazon DSP Campaign?

There are two paths to running DSP:

Managed Service (Through Amazon or an Agency)

Amazon's managed service requires a minimum spend of $50,000+ (it fluctuates). You work with an Amazon ad consultant who builds and manages your campaigns. The alternative is working with an agency like Marknology that has direct DSP console access and can run campaigns at lower minimums with more strategic control.

Self-Service (Enterprise DSP Console)

Some large brands and agencies have direct access to the DSP console. This gives you full control over campaign setup, audience building, creative management, and optimization. Marknology operates as a self-service DSP partner, which means we have the same console access as Amazon's internal teams.

Campaign Structure Best Practices

1. Start with retargeting. Your highest-ROI DSP campaigns will always be retargeting people who already know your brand.
2. Layer in competitor conquesting. Target people who viewed or purchased from your top 5-10 competitors.
3. Build awareness last. Top-of-funnel campaigns (in-market and lifestyle audiences) require more budget and patience. Scale into them once retargeting is profitable.
4. Separate campaigns by funnel stage. Do not mix awareness and retargeting in the same campaign. The KPIs are completely different.
5. Use dynamic e-commerce creatives. They pull your real product info and convert better than static banners.

How Do You Measure Amazon DSP Success?

DSP measurement is different from Sponsored Ads. You cannot just look at ROAS and call it a day. Here are the metrics that matter:

• Detail Page View Rate (DPVR): What percentage of people who saw your ad clicked through to your product page
• Purchase Rate: What percentage of people who saw your ad ended up purchasing (even without clicking)
• New-to-Brand Metrics: What percentage of conversions came from first-time buyers
• Total ROAS (including halo effect): How DSP spend lifts your overall Amazon sales, not just attributed sales
• Branded Search Lift: Did branded search volume increase during the campaign?
• Subscribe & Save sign-ups: For CPG brands, this is a critical downstream metric

The brands that win with DSP are the ones that stop measuring it like PPC. DSP is a brand-building tool. If you are only looking at last-click ROAS, you are missing 80% of the value.-- Andrew Morgans, Startup Hustle podcast

At Marknology, we use Amazon Marketing Cloud (AMC) to build custom attribution models that show the true impact of DSP across the full customer journey.

What Are the Most Common Amazon DSP Mistakes?

We have audited dozens of DSP accounts from other agencies and in-house teams. These are the mistakes we see most often:

1. Starting with awareness before retargeting. You are burning money if you are not capturing the low-hanging fruit first.
2. Using generic creatives. Your DSP ads need to match the audience segment. A retargeting ad should be different from a prospecting ad.
3. Ignoring frequency caps. Showing the same ad 20 times to the same person is not persistence, it is waste.
4. Not separating by device. Desktop, mobile, and Fire TV perform very differently. Optimize each separately.
5. Measuring DSP like Sponsored Ads. If you expect 5x ROAS from a top-of-funnel awareness campaign, you will always be disappointed.
6. Running DSP without strong listings. If your product pages are not optimized, all that traffic converts at a fraction of what it should.

How Much Does Amazon DSP Cost?

DSP pricing works on a CPM basis, typically ranging from $3 to $15+ CPM depending on the audience, ad format, and inventory. Here is a rough framework:

• Display retargeting: $3-$6 CPM (lowest cost, highest ROAS)
• Display prospecting: $5-$10 CPM
• Video (in-stream): $10-$20 CPM
• OTT/Fire TV: $20-$40 CPM
• Audio: $8-$15 CPM

Most brands working with Marknology start DSP at $5,000-$15,000/month and scale from there based on performance. The brands spending $50K+ per month on DSP are typically doing $10M+ annually on Amazon and using it as a core growth lever, not an experiment.

Andrew Morgans puts it bluntly: "If you are spending $100K a month on Sponsored Ads and $0 on DSP, you are leaving money on the table. The brands we manage in Kansas City and across the country that layer DSP on top of PPC consistently see 20-40% lift in total sales within 90 days."

Frequently Asked Questions

What is Amazon DSP?

Amazon DSP (Demand Side Platform) is Amazon's programmatic advertising system that lets brands buy display, video, and OTT ads on and off Amazon using Amazon's first-party shopping data for targeting.

How much does Amazon DSP cost?

Amazon DSP works on a CPM model. Display ads typically cost $3-$15 CPM. Video and OTT ads range from $10-$40 CPM. Most brands start with $5,000-$15,000 per month. Amazon's managed service has a $50,000+ minimum.

What is the difference between Amazon DSP and Sponsored Ads?

Sponsored Ads are self-service, keyword-targeted, pay-per-click ads that appear on Amazon. DSP is programmatic, audience-targeted, pay-per-impression advertising that appears on and off Amazon. Sponsored Ads capture existing demand; DSP creates new demand.

Do I need an agency to run Amazon DSP?

You can access DSP through Amazon's managed service (high minimum spend) or through an agency with self-service DSP access like Marknology. Most brands benefit from agency management because DSP requires specialized expertise in audience strategy and programmatic optimization.

What is a good ROAS for Amazon DSP?

ROAS varies by funnel stage. Retargeting campaigns typically see 5-15x ROAS. Prospecting campaigns see 1-3x ROAS but drive new-to-brand customers. The true value of DSP is measured through total sales lift and new customer acquisition, not just last-click ROAS.

Can small brands use Amazon DSP?

Yes, through agencies with self-service DSP access. While Amazon's direct managed service requires $50,000+, agencies like Marknology can run DSP campaigns for brands with smaller budgets, typically starting at $5,000 per month.

How long does it take to see results from Amazon DSP?

Retargeting campaigns can show results within 1-2 weeks. Prospecting and awareness campaigns typically need 4-8 weeks to build enough data for meaningful optimization. Most brands see clear lift within 90 days.

What is Amazon Marketing Cloud and how does it relate to DSP?

Amazon Marketing Cloud (AMC) is a clean room analytics tool that lets advertisers analyze cross-channel data from DSP and Sponsored Ads together. It provides custom attribution models that show the true impact of DSP beyond standard reporting.

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