For years, Amazon has controlled the worlds of e-commerce and shipping, but it's now taking on its significant streaming rival. Amazon has quickly upped its advertising game now that it is firmly established as a media company. Amazon has been able to compete with Facebook and Google in the advertising market for more than a year now.
In the United States, Amazon accounted for 4.1 percent of all digital ad spending in 2018. It may not seem like much, but it makes Amazon the third-largest ad platform for programmatic advertising.
Amazon isn't a newcomer to the world of programmatic advertising. For at least a decade, Amazon has featured sponsored listings at the top of its e-commerce search results pages. However, the company has made some significant adjustments to its approach to programmatic advertising, which could help them become a more prominent player.
What is Programmatic Advertising?
Programmatic advertising, at its most basic level, is the purchase and sale of digital advertisements using technology. The purchase of digital ad inventory across the web, mobile, applications, video, and social media is done through an automated procedure within the constraints set by the advertiser. Based on a number of indications, such as shopping patterns, programmatic advertising uses workflow automation and machine learning algorithms to deliver the most effective ads to audiences.
But what does it have to do with Amazon DSP?
Advertisers may use Amazon data without having a presence on Amazon's site, thanks to Amazon DSP. Advertisers can use Amazon DSP to target customers based on their Amazon search history and show them ads on a variety of websites. The nice part is that these ads don't have to link to the brand's Amazon page. Using Amazon's DSP, a company can run programmatic campaigns based on Amazon's intent data, with the advertisements directing customers to the company's own website. As a result, marketers can increase traffic to their own e-commerce site or to their Amazon listings.
Even though it's a perfect match for advertisers, very few of them are really using it. In fact, many advertisers may not be aware that the Amazon DSP is available as part of the advertising platform. In this case, their lack of knowledge may be understandable. Amazon hasn't been very open about its DSP and all of its advantages. It doesn't have to be that way, either. There are numerous departments on Amazon. Amazon Prime Video and Amazon Web Services are just a few of the company's multi-billion-dollar behemoths that take the majority of its attention.
Don't be deceived, though. Even if Amazon doesn't promote its DSP, that doesn't imply it doesn't have a lot of value to offer. Here are just a few of the benefits Amazon DSP has to offer.
Benefits of Using Amazon DSP Programmatic Advertising
The advantages of programmatic advertising are numerous. Advertisers may improve their efficiency, reach, measurement and optimization in real-time. Amazon DSP is the only advertising platform that allows marketers to run highly targeted display advertisements both on and off Amazon, allowing them to reach customers who don't convert but browse product detail pages. These advertisements can also be targeted to shoppers who just started out shopping in a category. When done correctly, Amazon DSP advertisements can help a company's Amazon business grow significantly. Let's get into more in-depth details about how DSP can help you.
Wider reach
Advertisers can reach audiences based on a variety of signals, such as shopping and browsing activity across devices, using Amazon DSP programmatic advertising. On and off Amazon, you might find new customers who are actively looking for things that they want to buy.
You may also use display ads on and off Amazon to reach out to customers at all stages of the buying process. When implemented correctly, Amazon DSP allows brands to reach shoppers with dynamic e-commerce creative and audience targeting, allowing them to reach a larger audience and increase brand recognition.
Accurate metrics and data
To get the best results, Amazon DSP programmatic advertising provides real-time measurement and adjustment. Using Amazon's Audience data, you can discover about your brand's target demographic, purchase frequency, and time between deliberation and purchase, as well as obtain actionable insights about your viewers and purchases. Make use of this information and integrate it into Amazon's overall plan. Informed bid modifications and increased chances of winning targeted ad spots and audience segments will be made easier.
More control over ads and expenditures
Ads are bought in bulk in traditional media buying, and advertisers have minimal control over inventory and placement. Advertisers can be more confident that their ads will appear in relevant brand contexts when they use programmatic advertising because they know where they will appear. Stop wasting ad impressions by making advertising budgets more efficient. Start small and scale up after a few months of solid data to gauge your brand's success on the Amazon DSP.
Additionally, Requests for bids (RFPs) and quotes, as well as conducting discussions and creating insertion orders, take time in traditional advertising. The procedure is more streamlined using Amazon DSP's programmatic advertising. Through Real-Time Bidding, advertisers may swiftly buy and position advertising. By distributing advertising to relevant audiences and reducing the possibility of ad fraud, programmatic media buying helps save money by reducing wasted ad impressions.
What are the Challenges?
As with everything unfamiliar to new users, programmatic advertising poses its fair share of challenges.
Threats to the brand
Brands want to make sure their ad content isn't displayed next to stuff that isn't positive, contentious, violent, or possibly damaging to their image. There have been a few notable cases of corporations fighting back against platforms that placed their adverts next to content that was potentially damaging or problematic. Brands want to make sure that their messages are in sync with stories and material that are reliable and factual.
Regardless of why your company doesn't want to appear in specific types of material, it's critical that such restrictions are enforced throughout all campaigns. Amazon DSP is making clear steps towards improvements in this area.
Ensuring quality of inventory
The ad inventory that a publisher makes accessible for programmatic buying on the open market is referred to as programmatic inventory. This inventory is then auctioned off in real-time, putting the ad in front of the viewer's eyes. Consider the fact that if you're browsing the internet, and you open a page, adverts will almost certainly appear alongside the content you're seeing. This is happening in every browser in the United States and around the world. Programmatic advertising, like other forms of media, has become a commodity.
Because everyone utilizes the same market space, some types of ads may be in short supply. With the rise in popularity of programmatic advertising, marketers are increasingly able to access non-commoditized inventory through Amazon DSP.
Initial learning curve
The learning curve for programmatic can be daunting at first. Advertisers can ease their way into programmatic advertising by working with partners or directly with Amazon Ads.
The cost of Amazon DSP programmatic advertising
Amazon DSP advertising is technically open to anyone who wants to use it. Still, it has been deemed unreachable by Amazon's smaller and mid-sized brands due to its complexity and high cost.
To address the issue of complexity, similar to how amazon seller account management services streamline seller operations, Amazon does offer a managed service program, but with a minimum ad cost of $35,000, it is frequently prohibitively expensive for most merchants.
It's difficult to say how much programmatic advertising costs, although it's often based on CPM. The cost varies depending on who you're attempting to target, your supply parameters, your budget, and how long you want the campaign to continue. The campaign's final price will alter if these criteria are changed. The CPMs necessary to get inventory is influenced by the targeting and ad group characteristics. Advertisers are charged through real-time bidding in programmatic advertising.
Summary
Advertisers can utilize the Amazon DSP to run and optimize programmatic digital media campaigns aimed at increasing brand awareness and sales. The programmatic buying of display, video, audio, and in-app ads is unique to Amazon DSP. In addition, Amazon DSP allows you access to the millions of people who shop on Amazon's website and in its physical stores, as well as their demographics and insights.
Targeting customers at various times during their purchase journeys will be easier if you use Amazon DSP in your overall marketing strategy. This is one of the most powerful tools available to companies wanting to improve their marketing and sales strategy.
By leveraging frequency control and a better understanding of their target, programmatic advertising is a wonderful alternative for executing branding projects. It allows advertisers greater efficiency, reduced costs, and less waste.
You can use Amazon DSP to organize your programmatic ad campaign to reach relevant audiences and learn how to connect with them in a variety of ways. You can also access exclusive platforms such as IMD TV, Twitch, and more.
