8 Common Amazon DSP Mistakes to Avoid

Common Mistakes to Avoid

1. Not Aligning Campaign Goals with Funnel Stage

The Mistake: Launching DSP campaigns without any clearly defined objectives, such as brand awareness, lack of product consideration, or conversions.

Why It Matters: Amazon DSP supports full-funnel advertising. Although each stage of the funnel requires different strategies, audiences, creatives, and KPIs. Following the generic setup often leads to mismatched expectations and dissatisfying results.

Tips To Avoid It: Clearly define the campaign objective, such as awareness, consideration, or conversion. While viewable CPM is often used for awareness and dynamic CPM for conversion-focused goals, the best choice depends on your optimization strategy.

2. Using Uniform Ad Format for All Goals

The Mistake: Running the same ad format across all campaigns and goals.

Why It Matters: Different ad formats serve different purposes. For instance, static display creatives perform better for retargeting, while video ads drive high engagement for awareness.

Tips To Avoid It: Use Responsive eCommerce Creative ads for mid to bottom-funnel campaigns where product-level conversions are the goal. These creatives are automatically built based on product detail page content, ideal for ASIN-level conversion campaigns.

3. Reliance on Fixed CPM Bidding

The Mistake: Using fixed CPM (Cost-per-impressions) for all the items irrespective of performance goals.

Why It Matters: Fixed CPM offers no real-time optimization. It can overspend on low-performing impressions and underperform on high-converting opportunities.

Tips To Avoid It: For campaigns focused on driving conversions, it is highly recommended to use dynamic CPM (dCPM). Use fixed CPM only when guaranteed delivery is required, such as through private marketplace or Amazon Publisher Direct deals. For conversion-focused goals, dynamic CPM provides better bid optimization flexibility.

4. Neglecting Audience Segmentation

The Mistake: Using audience segments that are duplicated over multiple line items or running campaigns with excessively large audiences.

Why It Matters: Incorrect or poor audience segmentation leads to inefficiencies, budget cannibalization, and overlaps. The worst part is that it limits your ability to analyse and optimise based on audience performance.

Tips To Avoid It: Segment audiences based on buying intent and funnel stage. Use Amazon's audience insights to identify high-value segments, or you can also leverage Hector to build smart audience segmentation. Remember to avoid targeting the same audience in multiple campaigns unless there's a unique strategy for each. Use Amazon Marketing Cloud to create custom Amazon DSP audience segments and apply Amazon’s audience overlap reports to reduce duplication and improve targeting efficiency.

5. Skipping Retargeting Campaigns

The Mistake: Focusing only on prospecting campaigns and disregarding retargeting campaigns.

Why It Matters: Retargeting helps in bringing back customers who have looked at your product pages, added items to their cart, or bought related products. And this is where Amazon DSP really shines.

Tips To Avoid It: Set up retargeting campaigns using audiences such as product detail page viewers or recent purchasers. For more advanced behavior-based retargeting, such as cart abandoners, consider using Amazon Marketing Cloud or integrated platforms.

6. Setting Frequency Caps Too High (or Not at All)

The Mistake: Showing ads too frequently or not capping impressions per user at all.

Why It Matters: Especially in retargeting campaigns, it is necessary to set the frequency capping as overexposing users to your ads leads to banner blindness, negative sentiment, and wasted impressions.

Tips To Avoid It: Apply frequency caps per user per day or week based on funnel stage and ad inventory type. Keep in mind that frequency control can behave differently depending on where and how the ads are delivered. Hector Ai provides you with a detailed campaign report highlighting various metrics. Study the report carefully and modify accordingly. 

7. Ignoring Geographic and Device Bid Multipliers

The Mistake: Treating all users and devices the same when it comes to bid value.

Why It Matters: Not all impressions have equal value. Users in certain geographies, devices, or time slots may perform better. Failing to adjust bids accordingly limits campaign efficiency.

Tips To Avoid It:

Use bid multipliers with dynamic CPM campaigns to adjust bids by location, device, or time of day. To implement time-based bid strategies, configure dayparting alongside your bidding rules. Use Hector's dayparting to know when your users are most active. Besides, go through our bidding strategy report, which groups the performance of bidding strategy types on numerous parameters.

8. Running DSP Without Optimization

The Mistake: Driving traffic to product detail pages (PDPs) that are poorly optimized or out of stock.

Why It Matters: You might be spending a lot of dollars on campaigns to send users to PDPs, but they don't convert due to poor reviews, low-resolution images, lack of A+ content, or pricing issues.

Tips To Avoid It: Before running DSP campaigns, ensure product detail pages are retail-ready with quality content, positive reviews, competitive pricing, and Buy Box control. 

Conclusion

Though Amazon DSP is an effective platform, it's simple to spend a lot of money and get little in return without careful planning and constant tweaking. Every detail matters, from choosing the best bid strategy to carefully dividing audiences. Avoiding these common mistakes and sticking to the mindful strategy will put your brand in a better position to grow. To provide precise data for your DSP strategy, start utilizing platforms like Hector.