When it comes to Amazon advertising, Sponsored Ads and the Demand Side Platform (DSP) are two popular solutions that often find themselves pitted against each other in online discussions. Headlines like "Sponsored Ads VS DSP, which is better?" dominate search results, leading many brands to believe they have to choose between the two. However, this narrow perspective fails to capture the true potential of leveraging both advertising options together. In this article, we will debunk the myth of competition and shed light on why running both Sponsored Ads and DSP can be a game-changer for brands seeking to enhance their market share and drive sales on Amazon.

1. Full Funnel Customer Engagement

In todays online landscape, shoppers have more choice than ever when it comes to product research occurring across multiple digital touch-points. Amazon data shows that 64% of shoppers use multiple retail channels to make a purchase and highlights the importance in engaging with your potential customers before they even reach Amazon’s marketplace.

While Amazon's Sponsored search ads provide the opportunity for brands to bid against and target specific keywords or products that shoppers are researching or engaging with, Amazon’s display and DSP ads offer a more refined approach by enabling brands to precisely target specific audiences. This includes shoppers who resonate with a particular lifestyle, those who are actively in-market for a specific category or product type, and customers who have recently shown interest and made a purchase from a particular brand.

In the below ‘purchase funnel’ highlights the key areas where both Amazon’s Sponsored Ads and DSP advertising excel within the different stages, starting at brand discovery within the awareness stage right through to point of sale.

Sponsored Ads are highly effective at capturing customers at the point of purchase intent, when they are actively searching for specific products on Amazon. By appearing prominently in search results and product detail pages, Sponsored Ads provide the necessary visibility to drive immediate conversions towards customers close to the point of purchase.

On the other hand, DSP plays a crucial role in building brand awareness and engagement at earlier stages of the customer journey. By leveraging programmatic advertising, DSP allows brands to reach potential customers on and off the Amazon platform, across various websites and devices. This helps create brand recognition, establish trust, and foster engagement with a broader audience.

By utilising both Sponsored Ads and DSP, brands can unlock the potential to create bespoke remarketing audience segments, providing a highly effective means of reconnecting with high value shoppers who have shown intent. These segments can include shoppers who have explored your product page, engaged with your direct-to-consumer (D2C) website, or even shown interest in competitor brands and products on Amazon. This technique not only helps drive a higher customer lifetime value (LTV) but also helps build customer re-engagement, encouraging repeat purchases and enabling for greater cross-selling opportunities across your brand's product portfolio.

By combining Sponsored Ads and DSP, brands can create a comprehensive advertising strategy that accompanies potential customers throughout their decision-making process, from initial awareness to the final purchase and ensures brands engage and discovery new potential customers that supports incremental sales growth.

2. Increased Brand Visibility & Marketshare

Combining the strengths of Amazon’s Sponsored Ads and DSP available ad placements (i.e. where your brands ads will be seen online) provides brands with greater opportunity engage with customers online, whether that’s off Amazon at the beginning stages of the user journey, or within Amazon’s marketplace targeting shoppers within search and at the point of purchase.

This increased exposure achieves two primary goals, the first is that you are priming your target customers to be aware of your brand and product offering over time leading to trust and authority being built up but also leading customers to organically search for your brand when it’s the right time for them to research and discover more within their purchase cycle. The second is that you are able to get in-front of shoppers who may be considering other brands within your vertical, for example using Amazon DSP to target off Amazon review websites for known in-market shoppers and broader targeting, such as on popular news websites to further spread your brand message to as many new shoppers as possible.

3. Enhanced Targeting Capabilities

When brands combine Sponsored Ads and DSP, they gain access to a comprehensive suite of targeting options that significantly expand their reach and allow for more precise audience targeting. As already highlighted, Sponsored Ads provide keyword targeting within the Amazon platform, enabling brands to capture customers who are actively searching for relevant products whereas DSP taps into Amazon’s vast pool of shopper and data signals to identify and target specific audiences based on demographics, interests, lifestyle and behaviours.

By combining both keyword and audience based targeting capabilities offered by Sponsored Ads and DSP, brands are able to deliver comprehensive targeting strategies that covers both active searchers who are in-market and broader audience segments who may be within the early stages of discovery and research. This integration ensures you can deliver maximum exposure to potential customers throughout the various stages of their buying journey (highlighted in section 1.). While Sponsored Ads capture the attention of customers who are actively searching for products, DSP enables brands to engage with a wider audience and build brand awareness, ultimately driving more conversions and boosting sales. This approach to targeting shoppers at specific stages of the buying journey ensures brands can target the right shoppers, at the right place and at the right time to help maximise advertising impact, increasing conversions and boosting sales.

4. Richer & Actionable Insights

In addition to enhanced targeting capabilities, the combination of Sponsored Ads and DSP also provides brands with richer and more actionable insights through increased volumes of captured data. These additional data points and available insights are invaluable for driving data-informed strategies, optimising advertising campaigns for maximum impact and understanding key business insights into shopper behaviour and product reception amongst customers.

By combining Sponsored Ads and DSP, brands can leverage the power of both keyword data and audience insights, resulting in a comprehensive and data-driven approach to advertising on Amazon and enable brands to get a fuller picture on who their target audiences are, what they are searching for and even discovering new customer profiles to go after. These richer and actionable insights enable brands to refine their strategies, optimise their campaigns, and make data-informed decisions that drive better results.

Additionally, the combination of Sponsored Ads and DSP provides brands with a feedback loop of data. By continuously monitoring and analysing the performance of their campaigns, brands can gather insights on what is working and what can be improved. These insights can then be used to refine targeting parameters, creative elements, and bidding strategies to continually optimise advertising efforts and drive ongoing success on Amazon.

Amazon Sponsored Ads and DSP - Better Together

To summarise, the combination of Amazon Sponsored Ads and DSP presents a powerful advertising strategy that can significantly boost brand success on Amazon. Rather than viewing these two solutions as competing products, brands should recognise the unique strengths they both bring to the table and leverage them together for maximum impact.

So instead of choosing between Sponsored Ads and DSP, consider combining the advantages of both platforms to unlock additional growth opportunities for your brand on Amazon.

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