When executed effectively, Amazon DSP Advertising can dramatically improve your programmatic display campaigns, allowing brands to reach the right audience at the right time with the right message. To help digital marketers maximize return on ad spend, here are eight strategies designed to optimize performance, drive more conversions, and create sustainable growth.
Image source: pixabay.com
1. Define and Segment Your Audience
The first step to maximizing performance is to clearly define your target audience. Amazon’s DSP allows advertisers to segment based on in-market behavior, demographics, and lifestyle interests. Start by mapping your ideal customer profiles and then build audience segments tailored to each group.
For example, if you sell fitness supplements, create one segment targeting frequent gym-goers and another targeting casual health enthusiasts. To execute this, use Amazon’s audience insights dashboard, select relevant pre-built audiences, and layer them with lookalike or custom audiences for a hyper-targeted approach.
2. Leverage Retargeting Campaigns
Retargeting is one of the most powerful tools within DSP. According to Thrive Internet Marketing Agency, it allows you to re-engage users who viewed your product pages or added items to their cart but didn’t complete a purchase.
Set up dynamic retargeting by integrating your product catalog into Amazon DSP, then choose “Viewed but not purchased” as a targeting option. For example, if a shopper viewed a $60 electric kettle but didn’t buy, your ads can show them a carousel with similar products or offer a discount to encourage conversion. Adjust frequency caps to avoid overexposure and banner fatigue.
3. Optimize Creatives for Each Funnel Stage
Different stages of the buyer journey require different creative approaches. Use educational and awareness-focused creatives for upper-funnel audiences, such as lifestyle images or informative videos. For mid-funnel campaigns, display ads with product benefits and social proof. Bottom-of-funnel ads should feature urgency-driven copy like “Limited Stock” or “Save 10% Today.”
Create multiple ad variations per audience segment, A/B test them, and replace underperforming creatives every few weeks to maintain relevance.
4. Use Lookalike Audiences for Scaling
Once you have data from your first-party audiences, create lookalike segments to scale your campaigns without losing targeting precision.
For example, if your top-performing customers spend over $200 monthly, generate a lookalike audience that shares similar shopping habits. Within Amazon DSP, select “Audience Expansion,” choose your seed audience, and allow the algorithm to find shoppers with comparable behaviors.
5. Combine DSP with Sponsored Ads
Running DSP alongside Sponsored Products and Sponsored Brands creates a full-funnel strategy. Sponsored ads capture high-intent shoppers in search results, while DSP engages them off-platform.
A good execution example: Use DSP to drive traffic to product detail pages, then run Sponsored Product ads targeting those same ASINs to capture them when they search again. This creates a “surround sound” effect that keeps your brand top of mind.
6. Monitor and Adjust Frequency Caps
Ad fatigue is a common issue in display advertising. Monitor your frequency reports to ensure users aren’t seeing your ad too many times, which can cause diminishing returns.
Set frequency caps to a maximum of 3–5 impressions per user per day, then analyze performance weekly. If click-through rates drop, refresh creatives or lower caps. Testing different caps across campaigns can help you find the sweet spot for optimal engagement.
7. Optimize for Conversions, Not Just Impressions
While impressions measure visibility, conversions drive ROI. Shift your optimization focus toward metrics like cost-per-acquisition (CPA) and return on ad spend (ROAS).
Use Amazon DSP’s reporting dashboard to identify which audience segments convert best. For instance, if repeat customers have a higher ROAS than new-to-brand audiences, allocate more budget toward them while continuing to nurture new prospects.
8. Continuously Test and Iterate
Programmatic display is not a set-and-forget channel. To maximize results, regularly test new creatives, audience combinations, bidding strategies, and placements.
For example, you might find that video ads outperform static banners for a younger audience but not for an older demographic. Document your findings, scale what works, and pause what doesn’t to maintain an efficient media mix.
By applying these strategies consistently, marketers can unlock the full potential of Amazon DSP Advertising, ensuring campaigns stay optimized and deliver measurable business growth.
