#255 – All You Need to Know About Amazon DSP!
As an Amazon seller, you know that much of any conversation centers around advertising. For the last year, PPC has been front and center. But, as you’ll soon hear, they’re not always the biggest player.
For most Amazon sellers racking up hundreds or thousands of dollars in pay per click advertising fees, it might seem like serious money. However, when it comes to monthly advertising expenses or a high bar of entry, Amazon’s DSP, or display side platform takes first place. Amazon DSP is a demand-side platform that enables advertisers to programmatically buy display, video, and audio ads both on and off Amazon.
That’s why, today on the Serious Sellers Podcast, Helium 10’s Director of Training and Chief Evangelist, Bradley Sutton welcomes two Amazon advertising and DSP pros to give us the full scoop on Amazon’s own ad solution. James Thomson and Dave Vermeulen are both working with Buy Box Experts, a leading Amazon agency, James as Chief Strategy Officer, and Dave as their Director of DSP Advertising.
Listen in to find out how James and Dave have crafted advertising strategies for established e-commerce businesses, recognized brands, new brands, and those that just have a passion for selling.
In episode 255 of the Serious Sellers Podcast, Bradley, James, and Dave discuss:
- 03:45 – Insights into the Early Days at Amazon
- 05:00 – How DSP Helps Drive E-Commerce Growth
- 08:00 – Finding “Exactly” the People You’re Looking For
- 09:30 – What is Demand Side Platform (DSP)?
- 11:40 – How Amazon’s Retargeting Capability Works?
- 13:45 – How DSP Reaches Customers Throughout the Advertising Funnel
- 17:00 – Collecting Data and Experimenting with DSP
- 19:30 – Building a Look-Alike Audience
- 23:30 – What Other Platforms Does DSP Work With?
- 27:15 – Leveraging Amazon (and DSP) During COVID
- 30:30 – DSP is Expensive
- 34:30 – Are You Ready for DSP?
- 38:10 – Popular DSP Questions
- 41:00 – A Look at DSP Metrics
- 44:00 – How to Find Out More About DSP
Enjoy this episode? Be sure to check out our previous episodes for even more content to propel you to Amazon FBA Seller success! And don’t forget to “Like” our Facebook page and subscribe to the podcast on iTunes, Google Play or wherever you listen to our podcast.
Want to absolutely start crushing it on Amazon? Here are few carefully curated resources to get you started:
- Freedom Ticket: Taught by Amazon thought leader Kevin King, get A-Z Amazon strategies and techniques for establishing and solidifying your business.
- Ultimate Resource Guide: Discover the best tools and services to help you dominate on Amazon.
- Helium 10: 20+ software tools to boost your entire sales pipeline from product research to customer communication and Amazon refund automation. Make running a successful Amazon business easier with better data and insights. See what our customers have to say.
- Helium 10 Chrome Extension: Verify your Amazon product idea and validate how lucrative it can be with over a dozen data metrics and profitability estimation.
- SellerTradmarks.com: Trademarks are vital for protecting your Amazon brand from hijackers, and sellertrademarks.com provides a streamlined process for helping you get one.
Bradley Sutton: Have you ever wondered what Amazon DSP is and how it can help your business? Today, we’ve got two of the world’s foremost experts on this subject to talk about how DSP has played a role in one company increasing their total sales a hundred percent year over year. How cool is that? Pretty cool, I think.
Bradley Sutton: Hello everybody, and welcome to another episode of the Serious Sellers Podcast by Helium 10. I am your host Bradley Sutton, and this is the show that’s a completely BS-free, unscripted and unrehearsed organic conversation about serious strategies for serious sellers of any level in the Amazon world. We’ve got a couple of serious guys on with us right now, Dave and James, how’s it going?
James: Thanks for having us today, Bradley.
Dave: It’s going well.
Bradley Sutton: Awesome. Awesome. Now, before we get started, James has been on the show before, so guys, if you want a little bit more of his backstory make sure to check that other episode at helium10.com/podcast, but this is the first time we’ve met Dave here on the podcast. So, Dave, just a couple of minutes, what’s your background? Where were you born and raised and how did you get into this amazing Amazon world here?
Dave: Yeah, actually born in Queens, New York. I don’t think I’ve been asked that question in a long time, but I’m proud of it. But I’ve grown up in Seattle for basically my whole life, not to date myself too much, but when I started with internet advertising, it was with dial up internet. I ended up creating my own agency here in Seattle.
Bradley Sutton: Wasn’t that like AOL and you’ve got mail days, and stuff like that?
Dave: It was actually free internet.com.
Bradley Sutton: Oh, wow. I remember that.
Dave: Shaquille O’Neal was a spokesperson of ours for a little while, so it was pretty fun. So then I ended up starting my own agency. And then, as the industry’s shifted them, have really been working on programmatic and DSP for the last 10 years, sought out the Amazon DSP because if its data protection and industry-wide is known for its performance, joined with a smaller agency called the agility and built out their DSP department, then joined with buy box experts a little over a year ago. And I’ve done the same here.
Bradley Sutton: Cool, cool. I love it. What part of Queens? I used to live off for about a year and I would split my time between Brooklyn and Long Island city.
Dave: Yeah. So I moved when I was like 10 years old and I’d barely remember, but I know it was just over the Triborough bridge and it was like rent protected, police fire type of apartments.
Bradley Sutton: I think that’s right around where they were thinking of making another Amazon office or something like that that got eventually canceled or something like that. But anyways, we digress. James real quick, like I had forgotten this about you but you used to actually work at Amazon. Right?
James: I did. I spent almost six years at Amazon. I had a number of roles as is common for folks at Amazon. I was the category manager for sports so much like Dave’s Shaquille O’Neal comment. When I joined Amazon, people were like, oh, you’re going to hang out with all the famous athletes when you run sports. Like, no, I never met a single athlete. I’ve no idea what you’re talking about. But I went on to become Amazon’s first FBA account manager, which was an interesting trip. I took a bunch of sellers on trips to see the fulfillment centers. And then I ran Amazon services, which is the group that does most of the recruiting for new sellers joining the platform. So I got to see all sorts of interesting things happen when you have crushing demand of sellers wanting to use fulfillment centers in Q4 and all the good stuff that happens when customers buy more product than there is functionally able to have delivered to their homes in a short period of time.
Bradley Sutton: Yeah. All right, cool. So, all right. Guys, we have two, obviously very experienced people in this field that we’re gonna be talking about, which is DSP today. But before we get into like, just defining what that even is, I love how you guys put it. I was recently co-hosting a webinar with you two. And I love how in the beginning you kind of set the stage as to, before we even get into DSP. Like what are the problems that people are having to actually DSP can help with? So can you talk about that a little bit? Like what are some issues that a lot of Amazon sellers have that helps start the conversation of why they would even need DSP?
James: Dave, you want to take this one?
Dave: Oh yeah. So some of the common issues that we see or really opportunities where DSP can support any seller on Amazon is one, if there’s a product launch, the DSP is great at driving traffic and really building up those product reviews within category driving that relevant traffic. Another thing that we see that’s very common is brands have kind of hit that ceiling with their PPC, their sponsored ads, where it feels like the more they try to grow, the higher their bids are increasing and the less efficient they become. The DSP is ultimately really designed to help your PPC side grow. So it’s driving unique users into the PDPs and branded searches and it allows brand serve to really grow on platform.
Bradley Sutton: Yeah. And then also, just if we’re not in DSP, like we kind of have a lack of visibility on some metrics, right James? What are some of those metrics? You’ve been on both sides here. What– if I’m not using DSP, I’m just using Amazon sponsored ads or sponsored brands or things like that. What are some things that I am pretty much blind to?
James: I think sponsored products and sponsored brand ads are essentially billboards. And you’re buying one of the limited billboards that Amazon has on different parts of its website. And there’s a bunch of science that goes into determining who’s going to be the advertiser whose ad shows up on that billboard, but it turns out Amazon has a whole bunch of other data about particular customers, customers that have searched different products have purchased certain products, not just customers who are searching for certain keywords that you happen to bid on for a PPC ad. But all that other data Amazon has about those customers, Amazon is now making available so that you can do micro-targeting, much more accurate targeting of the needles in the haystack that you’re looking for. Who are those customers that have made certain types of purchases, have done it within a certain timeframe, have demonstrated a certain types of search behavior. And if we have any demographic information or other information about the consumers allows us to, again, further refine who we’re going to have this conversation with. So, unlike somebody driving down the highway and seeing a billboard, what if I could instead put an ad on the display of every single person’s car where it was a custom message, much like when you go on Amazon and you search for something, Amazon knows that it’s you and they know all of your past search history. And so the kinds of information they’re going to show you are going to differ for you versus me versus Dave, but let’s take that same concept and apply it to advertising and be in a position that we can go and talk to only those consumers or shoppers that have demonstrated certain types of behavior beyond just searching for a keyword.
James: For Amazon to make this data now available. And to be, to be clear, they’re making it available on a blind basis. You can access who those people are, but you still don’t know exactly it’s this customer and that customer, you just know it’s customers that have done certain things or demonstrate certain types of characteristics, but by being able to access those folks, you can now go and find the people and only the people that you’re interested in. Now, how many times have you typed in a term? And it shows up with two very different types of products because certain search terms happen to be relevant in two completely different categories. And you’re looking for one thing and lo and behold, the headline ad, the sponsored brand ad is for something wildly different that has nothing to do with what you’re looking for. Well, that’s because everything’s driven off of just PPC terms. What if we could go after specific customers who we know have done certain things in the past that make them highly relevant to us.
Bradley Sutton: Perfect. I hope we got some people excited now about this. So, actually, Dave, if you can just define what even DSP stands for, I’ll be honest. Like a year, I don’t know how long ago, it was a year ago. I had no idea what the heck was DSP. And I actually, I remember a time where I thought that DSP was just short for display, sponsored display, but completely different. So, Dave, first of all, what does DSP stand for and like, elevator pitch of a definition of what this platform.
Dave: So DSP actually stands for demand side platform. Many years ago, it was kind of the networks, everything was built out on SSP, which is supply side platform. And that just meant that the–
Bradley Sutton: I thought that was Serious Sellers Podcast.
Dave: I know. I’m looking right at the SSP right there but– and that was based on the fact that the publishers or websites are defining the cost. So they’re defining the CPM that you have to pay to get inventory as the industry shifted, it became everything about the demand side platforms, which is basically the brands are bidding on the cost and they’re in control of the inventory and how much the inventory costs. On Amazon specific, the Amazon DSP really just enables brands to reach shoppers both on Amazon and off of Amazon. And it enables them to use different executions, like retargeting people who have viewed their product detail pages, but haven’t purchased driving them back to the PDPs. There’s also a consideration awareness and retention plays where you’re trying to capture people who have purchased them before, have purchased before, but maybe trying to drive them to subscribe and save. And there’s really so many different executions for the DSP, but that’s kind of at the essence of it.
Bradley Sutton: Okay, cool. Now James, what would you say are the most common uses? I mean, the one that I think of now that I know a little bit about it is like the most no-brainer use would be, Hey, I’m a brand, I’m selling on Amazon and there’s people who are visiting my page. And I know they’re not converting because I can see my conversion rate on Amazon. Like, Hey, maybe it’s 20%. Well, those 80% of people who have visited my page and didn’t purchase, I would love to follow up and target them. To me, that’s like a no-brainer, but that’s the only one of many uses, right, for a DSP?
James: Certainly retargeting customers who visited your page and chose not to buy. That is an obvious way to use DSP. If you’re fortunate enough to have even a 20% conversion on your traffic on Amazon, that means 80% of the customers or the shoppers that came to your page. They didn’t buy your product. Well, I’d like a second or third crack at them to be able to tell my story and potentially tell the story a little bit differently. And just as many of us have had the experience of you go, and you look at one website, and then you happen to go to another website to read the news, or we look at the sports, you start seeing ads for things that you looked at at some earlier point in the day or earlier in the week. Well, that’s what the re-targeting capability of Amazon’s DSP allows you to do. Now, if we move beyond retargeting, we get into the capability where rather than just following our own customers around the web, what if we could follow our Amazon competitors’ customers around? So we can say, listen, we have– I’m making this number up. We have 10,000 glance views on our products, but if you look at all of the relevant competitors we have on Amazon, collectively, they have 50,000 glance views. But what if we go find all the customers that represent all that traffic, and we start to communicate and tell our story to people that we know are in the market for products like ours. And we can split apart people who did buy our competitor’s products and people who haven’t yet bought any of our competitors products. And so to the extent that we decided to go after competitors, shoppers, who haven’t purchased, but have visited competitor listings in the last X number of days, ie., they’re probably still in the market looking for these types of products. There’s an awful lot of shoppers out there on Amazon who would fit the bill.
Dave: It really is a massive opportunity because they’re taking that first step that is inefficient that of brand awareness, or even just category awareness and driving them on platform. And then we swoop in and re target them with messaging and drive them to our PDPs.
Bradley Sutton: Okay, cool. Now just keeping it with Dave for a second. I remember when you guys presented this before. Well, something that I found interesting, a lot of people who are familiar with e-commerce are familiar with sales funnels, but an interesting thing I learned was that unlike some methods of advertising, the DSP can actually be incorporated at the top of the funnel, mid funnel and bottom of the funnel. So could you just maybe talk to that point a little bit and why DSP and how it could utilize all three of those sections of the funnel?
Dave: Actually, if you visualize the funnel, we kind of break it into four different sections. There’s awareness at the top there’s consideration next. And then as you move your way down, then there’s purchase. And then retention is at the very bottom, our standard roadmap is to really capture that low hanging fruit first and at the very bottom in the retention area. If it makes sense for your product to retarget past purchasers and really turn them into subscribe and save just a loyal consumer of yours. And then the next stage up in purchase is when you’re retargeting people, driving them back to your PDPs, if they haven’t purchased. And then as you start to move up, then you start– say we’ve caught all of that traffic and we’re really efficient with the high total return. But then we’re starting to think about driving new unique users. That’s when we start moving into the consideration area, we can actually track how many unique users have seen the DSP ad and how is that helping you’re like new to brand percentage. And it’s all based. The DSP is everything on Amazon is last touch attribution. So if someone purchases something on a platform, it does not get credited to the DSP, but we can actually take a look and see exactly what branded keyword terms were searched after people engaged in a DSP ad. And we see how many times they searched for each keyword string. So, it’s really powerful in the way that you can capture new unique users that are in the market or your brands type of products, drive them into the product detail pages, and then we can retarget them at that high conversion rate in the lower part of the funnel.
Bradley Sutton: Cool. Now, James switching to you for a second, I remember there’s a lot of different kinds of audiences. You can do lifestyle, demographic, ASIN based. Let me just throw out a random scenario here. You may or may not be aware. We did this series on YouTube a couple of years ago called Project X. And we launched these products on Amazon. They’re not huge, but let’s just pretend it’s a seven figure brand, whereas coffin shelves, the brand was actually Manny’s mysterious oddities.
James: I remember those.
Bradley Sutton: Yup. We named it after your buddy Manny there, but I’m like, let’s say, all right, Hey, now I’ve built up this brand and it’s a seven figure brand. I got coffin shelves, I got other spooky decor kind of items, which one of these kinds of audience types would you start with, if you were me and how would that walk me through maybe how that campaign would look like.
James: So, it’s important to understand that DSP is a tool for collecting data and experimenting. And while you can get very strong returns, it’s also a tool where you can try out all sorts of different types of campaigns to be able to answer the very question you asked, think of every campaign as a hypothesis. Do I think this combination of characteristics about a customer is ultimately going to lead to a successful purchase? Well, if I need somebody who’s into buying these types of products, maybe there’s other types of products that would be good surrogates if they’ve purchased some other type of goth product, now, maybe they want a skeleton bookshelf. Okay, well maybe we think that there are certain lifestyle or age characteristics about customers that lead them to be more likely to buy this type of product. All of those are hypotheses that we can test. And so there’s no limit to the imagination you can put into let’s figure out what exactly is the right audience here on Amazon. And maybe, you’ve got one audience that converts at one level and a slightly broader audience that converts at a slightly lower level. But as you think about how to move up that funnel, no one’s expecting you to get it exactly right, right off the bat, which is where the beauty of being able to set up all sorts of different campaigns and test out how your product actually resonate with different groups of customers. So, when you asked me the question, how do we build the right audience? There is no such thing as the right audience. The answer is to develop hypotheses on what you think are the right types of audiences worth testing. And then let’s go test them. And just like we do with PPC, where we wait a few weeks for everything to fully saturate in Amazon’s algorithms.
James: Now we can start to make refinements three to four weeks out and move the budget around from one campaign to another. And if one campaign is not working, kill the campaign, but at the same time, are there surprises you have in the data where it turns out audiences that we thought might be peripheral are actually doing quite well. And maybe our audience, our target audience is broader than we thought, or it’s a slightly different group than we thought. Great. Use DSP as a mechanism to find those people. Now, one of the things that’s important to talk about that we haven’t mentioned, when you’re building an audience from scratch, if you have information about customers from some external shores, let’s say you have a Shopify or big commerce site, and you’ve got email lists of customers who have bought off of your external site. You can take that information, those email lists, and you can push them into the DSP system on Amazon. And you can build a lookalike audience. Amazon will take those emails, match them up to Amazon customers, look at the characteristics, behavioral characteristics of those customers and say, let’s go find other customers who have very similar behavioral characteristics, who aren’t customers who have bought off of your Shopify or big commerce site. Okay. Now we have a good starting point in terms of people that Amazon sees as close enough to your actual customers you’ve had outside of Amazon to start building additional audiences and testing out those new audiences. That kind of functionality is pretty amazing for omni-channel brands that do have preexisting notions and actually preexisting data about customers from outside Amazon.
Dave: Yeah, the really interesting part of it is you can take that original data set and you could either target those individuals or use it as an exclusion. So after you build the lookalike audience, you can actually exclude the original data set from ever seeing an ad from the Amazon DSP.
James: So if you do sell these skeleton bookshelves, not a product for everybody, but nonetheless, a product that you think has a big audience on Amazon finding those very people who are likely to be interested, we can take external email lists. We can look at competitor ASINs and say, go find people that have looked but not purchased these competitor ASINs. We can say, are there certain lifestyle characteristics that may well line up nicely with people who are interested in these products, all this kind of information. Every one of those is a hypothesis waiting to be tested with a different campaign. And as we refine the journey we take as we spend money on DSP, but also collect data and look at the results and figure out, yep, we need to tweak here, tweak there, or we’re going to get to a point where we have essentially found all the types of customers on Amazon that are going to be relevant to our products. That’s pretty exciting. And that’s a whole lot more efficient than let’s do a PPC ad. Now to be clear, and Dave can speak better to this than I can. It’s important. Just continue to spend money on PPC and use DSP as an additive on top of what you might otherwise be doing with PPC.
Dave: It’s that whole Amazon flywheel and how the DSP and the PPC relate to each other. So United says, since we’re running those product retargeting campaigns, which are driving people who’ve looked at the product, but haven’t purchased, but that’s a high conversion rate. So that type of traffic really plays into the Amazon algorithm as well. We’re driving traffic from off Amazon onto the platform, which is another portion of that. As well as we can engage in other strategies, like sending people through the storefront, which we know Amazon is pushing the storefront, huge with the posts and everything. They’re trying to move towards that social media side of it. And so with all of those things, as we’re driving new unique users, high converting rate traffic, then you see the PPC, that algorithm really works for the brand. They’re starting to win more bids at more efficient rates. And as their sales grow on the PPC, we really see their organic rankings increase. They start to capture more of a market share within their actual product line or within their category. And then as they’re driving up more awareness and capturing more organic traffic, it enables the DSP to have more opportunities to retarget people and send people back onto the platform again. And so as the two work together, you really see the whole boat kind of lift. And it’s really all about driving the top line sales, the OPS, at the end of the day.
Bradley Sutton: Cool, cool. Now, we’ve talked a lot about testing and gathering data and obviously the no-brainer platform, I guess, where a lot of that might be taking places on Amazon itself, but what other platforms or what other entities is Amazon DSP functioning on? Because it’s definitely not strictly on Amazon itself, right?
Dave: Correct. There’s different inventory supply sources. So it’s going to be on-platform, there’s going to be mobile mobile apps that we can tap into. There’s also mobile, both on Amazon and off Amazon. And then there’s also the APS, which is the Amazon Publisher Services. But I refer to it as Amazon preferred sites because it’s their network of sites that they vet themselves and optimize to the highest performance rate. So that network of sites really outperforms anything that I’ve worked with in any other DSP previously. But then also you do still have access to all the open exchanges. So, if you wanted to tap into some of the other networks in DSP and trading desks and different things of that nature, we have access to it. The real unique point is that they don’t have access to the inventory on Amazon. So, it really gives us the opportunity to reach everybody.
Bradley Sutton: All right, guys, quick break on this episode for the BTS Bradley’s 30 seconds. Here’s my 30-second tip. Did you know that you can actually see the registered address for any seller that’s on Amazon? If you go to any Amazon listing, you click on the sold by name, like so that you can get to their storefront name and right there on that page, you’re going to see their address. Now you should do this to yourself if you’re wondering what address is displaying, do you have your home address listed, basically that means any Amazon buyer can go and see your home address. So if you don’t want that to be the case, go into your settings in seller central and go into account info and then hit business address. And there’s a place where you can actually change your displayed address. It’s because it’s displayed on your public seller profile page, but be careful when you change it, don’t just put on some random address. This needs to be one of your business addresses because in case Amazon ever wants to verify that, you’re going to need to verify that is your address, but just be careful guys, be careful if you don’t want your home information out there, go check your storefront to see what is showing to the world.
James: Bradley, I think it’s worth mentioning that while there’s inventory, ad inventory on Amazon, ad inventory off of Amazon, there’s also this dynamic that well, sponsored products, sponsored brand ads, lead Amazon customers to click back to an Amazon product listing. With DSP. There’s another chapter you can open where you can do DSP advertising and drive the traffic, not to an Amazon listing, but to some other website. And so if you have an external DTC site, you can actually drive the customers or the folks who are seeing your DSP, Amazon DSP ads, they can be driven back to your Shopify or big commerce site. Now, there are restrictions on how you can create target audiences for those groups when you’re driving off of Amazon, but it’s nonetheless an option if you’re so inclined to figure out how you could leverage all Amazon data or most of the Amazon customer data to potentially build up your off Amazon presence.
Bradley Sutton: Okay. Now, keeping with you James for a second, I obviously gave you a hypothetical example of this spooky brand, but I’ve heard you speak of– I’m not sure if this was a hypothetical or this was a real case study about that outdoor furniture brand. Was that a real thing or was that just another hypothetical? Can you review that one? Because I find that I found that fascinating.
James: During COVID, we had a number of clients who very quickly discovered that their ability to sell products was being forced into online channels. Channels, where they hadn’t historically done a lot of volume or Amazon disproportionately was not one of the major channels along comes COVID and they’re realizing, oh my gosh, if I’m going to continue to sell the units, I already have on hand, I’m going to need to leverage Amazon in new ways. So a brand sells a certain amount on Amazon. Now they have to sell five times as much because all their other brick and mortar channels are basically deactivated during COVID. One of the brands we worked with, they recognized that they needed not only to continue to launch new products on Amazon, but Amazon needed to become a major channel for them during this otherwise downtime in other channels. And so they doubled down on DSP, targeting competitor listings, Amazon competitor listings in a very aggressive way, and were able to not only increase their sales significantly, but they were able to get very strong returns out of DSP in part, because DSP is not a democratized advertising tool at this moment. It’s something that you have to know how to go and get access to DSP. You can’t just go into seller central and go click, click, click. You have to go either through Amazon where Amazon will manage the dollars for you, or you have to go through an agency. We’re one of the agencies that has access to this tool, but there are others as well. And so with fewer brands using DSP at this time, returns are still rather strong that they are considerably better than what you will normally see in PPC, where quite frankly, somebody with $2 can start doing PPC advertising on Amazon.
James: That’s not the case with DSP, not at all. And so, with this particular outdoor brand, they needed to make a significant decision around where they are going to double down on advertising on Amazon. They went the route of continuing their PPC advertising, but also putting new dollars into Amazon DSP that allowed the flywheel to run that much faster and Amazon, they could target competitor traffic that much better than anything they could’ve done with PPC. And they grew their business significantly, very happy with the end result. Now, as things start to shift and we don’t have quite the same dire COVID e-commerce situation, many brands are still going to be moving towards DSP in recognition that there’s so much traffic on Amazon. There’s so many customers looking for stuff. If you can grab them at that point where they’re interested, where they haven’t yet made a purchase, DSP is a very, very powerful tool for finding audiences that in the past wouldn’t necessarily have been interested in your product.
Bradley Sutton: Yeah. Okay. Very interesting. I love hearing about that story. I think they had actually– their DSP was way outperforming their PPC and it was just a really positive case study all the way around. Now, before we get too far here and we’ve actually kind of covered a lot of these things, a lot of people might be getting excited. However, there’s a caveat. The fact of the matter is DSP is not for everybody. If you’re a brand new seller or you’re just starting and you’re making like a thousand, 2000, maybe even just grossing, only $10,000 a month, pretty much DSP is not an option for you, right?
James: DSP is expensive as a point of entry for most small brands on Amazon. Whereas with PPC, you can spend, as I say, a few dollars and get started and try, try testing PPC. With Amazon DSP, you can either go the route of, as I said earlier, using what’s called managed services DSP, which means Amazon will manage the DSP budget that you provided. Amazon is looking for about 30, $35,000 a month minimum in order to manage DSP for you through a self-service DSP program, which is one where you work through an agency. We’re able to offer brands the opportunity to get into DSP for $10,000 a month. That’s still a lot of money, $10,000 a month for DSP. And then as we said earlier, we recommend that budget over and above what you’re already spending on PPC. And so, being in a position to not only have that money available to spend on DSP, but being in a position that you have enough inventory to be able to support the kind of growth that DSP may provide, there’s a clear investment that has to be made in order to leverage this particular tool. DSP is a very sophisticated tool. And at this moment, Amazon has chosen not to make it available to everyone and anyone of all sizes of budgets in part, because they’re still going after the big, big ad dollars.
Bradley Sutton: So yeah, guys, in case you missed that, if you were trying to– if you were able to do this through Amazon directly, did I hear it right? $30,000 monthly spent is what– yeah, but then sometimes agencies such as buy box experts. You guys can do it for $10,000 a month, which is the minimum spend, right?
James: That’s correct. And just so people have realistic expectations here. Setting up DSP and getting it up and running and getting the Amazon algorithms to work effectively. It’s going to take three to four weeks just like it will when you set up a PPC campaign. So for you to get all the love from Amazon’s algorithms, the system has to run for a few weeks in order to make sure that all the right audiences, the right inventory are being matched up and so on and so forth. Amazon wants to sell more products for you. And so it takes time for those numbers to work out. But we’ve had clients who have done incredibly well with DSP in part, because they were willing to put the dollars up to try the program out. And most of our clients will try at least three months before they make a decision. Is this going to be the right long-term solution for them? And I think Dave can speak to this, but so, so many of our clients are continuing to increase the amount of spend each month that they put into DSP in part, because there’s still so much opportunity at the bottom of the sales funnel. If you can get in some situations, a 7, 8, 9 times return through DSP, wouldn’t you want to continue to double down on that?
Dave: Yeah. And it’s actually funny because we actually have to spend time strategically explaining why they need to leave their money in PPC, because they’ll at times want to try to pull it from the PPC, but that does not benefit their long term growth strategy. So, they end up having to find those dollars in other places.
Bradley Sutton: Okay. And then now Dave, let’s say, somebody is like, Hey, you know what, I do qualify, I’m making good money on an, on Amazon. I think I’ve kind of reached the limits of what I can accomplish just with PPC alone. So, DSP is something that’s– whether I’m going to do it on my own with Amazon or whether I’m going to hire an agency to do it. It’s something that I want to give a try. There’s like a bunch of stuff that you need to prepare even before you take that plunge for your brand or your store or whatever. Can you walk us through a few of those things that companies or brands need to just start getting ready if they really want to go ahead and get into DSP?
Dave: Yeah. The DSP is going to drive qualified traffic, so that will happen. So you need to be prepared to capture it. So, what’s your inventory position, are you making sure that you’re winning the buy box, that you’re not going to run out of stock on anything, are you optimized– are you fully optimized for your listings to make sure that we’re going to get that high conversion rate when we send the qualified traffic, do you have well built out branded keyword campaigns, both sponsored products, sponsored brands, and are you protecting your pages with a sponsored display with that protection type of ad campaign to make sure that competitors aren’t taking up space on your PDPs. And I think the last one on the checklist, it’s not as important if we’re just driving traffic to the PDPs, but how built out is your storefront and optimized to make sure that if people are going to go in [inaudible], that you’re going to keep them engaged.
James: The process of DSP, if you’re going to be targeting competitor traffic, you need to know exactly which competitor ASINs you’re going to target, because as we set up these campaigns, now, let’s say you’ve got five products in your catalog that you want to run DSP through. Each one of those ASINs is going to have a different competitive set. We’re going to ask you what is the appropriate competitive set for each of those ASINs, because we’re going to go and aim to talk to competitor traffic for each of those different ASINs. So knowing how to organize your competitors relative to your individual ASINs, that’s an important prerequisite to be able to do that type of DSP targeting. Likewise, the big question for brands that have never done DSP is where do I get the budget? We talked earlier about pulling some budget out of potentially Google or Facebook advertising budgets that you have today. We’re not suggesting you turn off any of those types of advertising, but it’s worth a test. It’s worth testing, taking some of those dollars and trying them in DSP. You may also have to have a conversation where you go to your CFO and say, listen, we want to run a DSP campaign test, and we’re going to need X thousands of dollars to do this test. And we’ll come back with the KPIs in three months and see if in fact we’re doing well enough that we can make this a continuous spend. Those conversations are awfully important because we don’t have infinite money here to run through advertising. So as a brand, thinking about how to make the trade-offs around where to put the dollars for advertising, Amazon DSP is making a big splash this year. And as long as this continues to be a first-mover program where not everybody’s got access to the tool, we’re going to, I believe, continue to see strong returns. And that’s a good time as a brand to be saying, I’m going to go do the DSP advertising before 10 other of my competitors are also fighting for exactly the same ad space as I am today.
Bradley Sutton: Okay, cool. Now, one thing I would like to ask for each of you, for so many of our listeners, I’m sure. And a lot of times when you guys present this information, I’m sure it’s many times for much of the audience the first time they’re getting to know about this. So, they have a lot of beginner questions or common questions. So I’m going to start with Dave, what is the number one, would you say the most common question that we haven’t covered today that people ask about DSP and then obviously what’s the answer to that?
Dave: Yeah, I think the most common one that we hear is, how does the traffic relate to the other traffic that we’re running off Amazon? Are we sure that it’s data protected, that we know there isn’t like duplication of sales numbers and I touched on it earlier. Everything on Amazon is last touch attribution. So, when we’re driving traffic on platform, if somebody clicks on a sponsored brand video or a sponsored product ad, DSP no longer gets credit for that. So even if the DSP engages in a user or a shopper, and they go on platform and they do a branded search and then end up clicking on a sponsored brand ads or sponsored product ad, the DSP doesn’t even get credit for that. So it’s driving ultimately the on-platform efforts with that last touch attribution, and then some of the other data protection is really– if you don’t want people that are engaging in your website or have purchased from your website, we can drop a pixel on the website and build exclusion audiences to make sure we’re not re targeting those individuals at all. And then we have control of actually blacklisting specific sites, if you don’t want your inventory to show up on specific websites as well.
Bradley Sutton: Okay, cool. James, do you have another common question?
James: I like the idea that DSP allows smaller brands. I’m talking folks that are not national brands, but it allows smaller brands to be very sophisticated and follow shoppers around the web. That’s not a question, but for me it’s an exciting component where brands can act big while they may not necessarily be big. And so by taking sophisticated targeting capabilities from the largest marketplace in the US and using that data to their advantage, a smaller brand can act big and become big by finding exactly those needles in the haystack. That’s really exciting for me. And I look forward to seeing how Amazon continues to build this out. I think there is in part, a big play here where Amazon is going after the big national ad dollars. And they’re going to be able to show by way of much better data that in fact brands should be spending more money at the bottom of the funnel, or mid-funnel on Amazon to go and communicate directly to shoppers on Amazon.
Bradley Sutton: Okay, cool. Now this could be– this last question could be either of you or both, or just one of you but every show, what we do at the end is we close it with a– what do we call the TST, or the TST 30-second tip. So, you’ve been giving us a lot of tips and strategies throughout this episode about DSP, but what is something that we haven’t mentioned that, I’m not going to like cut you off at 30 seconds, but roughly 30 seconds or less like a good strategy for somebody just getting into, started into DSP, like an easy win could be at any stage of the DSP journey, either of you can take this one.
Dave: Yeah. I’ll start. For me, because we don’t talk about it at ten, but it’s a massive part of what the DSP provides and the tip would be to use the data and the reporting to benefit your long term strategy. There’s massive amounts of data that comes from the DSP campaigns that we can analyze. We can run retail insights, reports, and it shows where you stand in your category, how you compare to your competitors, how much your DSP campaigns have influenced it. You can also take a look at– we’re featuring one product and driving people to that product detail page, but if they purchase something else from your brand halo, what are they purchasing? How often are they purchasing? So, you can kind of get an idea of what products are gaining traction as we’re moving forward. And then the audiences is huge. And James talked about this earlier, but we can run an audience segmentation reporting where we can actually see the people that have purchased from brands. What audiences do they live in? So, you might be able to identify an audience that you didn’t know how a large affinity for the products that you’re running, but it actually has a large amount of crossover, so you can identify new audiences and reach new shoppers.
Bradley Sutton: Cool. Cool. All right. Well, if people are motivated about this and excited, which I hope they are, and they want to go ahead and maybe reach out to you for more information on how they can possibly get into this program. What’s the best way that listeners of this podcast can contact you guys about this?
James: It’s pretty easy, Bradley. We have a whole team that does Amazon DSP, and you can reach us at email@example.com. So love to hear from you, love to chat with you to find out more about what journey you’re looking to take your brand on through Amazon. There’s a lot of opportunity here with DSP, and as long as Amazon continues to gate access to the program, give us a call because we can let you into the party.
Bradley Sutton: Awesome, awesome. Well guys, thank you so much for joining us. And we’ll definitely want to reach out next year. Who knows? Maybe I’ll get that Manny’s mysterious oddities brand up to the point where we can try some DSP as well.
James: Thanks for having us today. Bradley.
Dave: Yeah. Thanks, Bradley.
- #265 – New Seller Recap – They’re Not Beginners Anymore - July 24, 2021
- #264 – Introducing the Serious Sellers Club, and More! - July 20, 2021
- #263 – Have a Great Amazon Product? Here’s How to Protect Your Intellectual Property - July 17, 2021