✍️ About the Author: Pat Petriello is the Director of Retail Marketplace Strategy at Acadia and a Thought Leader in the eCommerce space.
Most brands are still treating Amazon DSP like it’s 2023: only running retargeting campaigns, singularly focused on ROAS and locked in ROAS jail, and over-indexing on demand capture at the expense of demand generation.
However, the media landscape has evolved, and the old playbook is no longer sufficient.
Today, growth doesn’t come from capturing the same in-market shoppers your competitors are already fighting over, but from reaching the ones who aren’t ready to buy yet—the ones who will be your customers tomorrow, next quarter, and next year. There’s a massively underserved market of shoppers who are not yet in-market today but will be in the future.
The opportunity is to create an emotional connection with those shoppers so they directly seek out that brand and bypass the ad auction altogether.
Amazon DSP has evolved into one of the most powerful tools for doing exactly that.
It’s here to deliver through a full-funnel platform for demand generation, demand capture, brand building, pinpoint audience targeting, and creative differentiation, all to deliver scalable profitability.
Welcome to DSP 2.0.
Acadia’s DSP Philosophy: The 95/5 Rule
At any moment, only 5% of a brand's potential shoppers are in-market and ready to buy. That leaves 95% who are not actively shopping for your products, but will be, eventually.
Yet brands overwhelmingly allocate the lion’s share of their budgets to the 5%, chasing quick wins and in-market conversions.
This obsession with immediate ROAS creates what can be described as “ROAS jail,” where brands continue to go deeper down the purchase funnel, chasing ROAS without actually growing the business.
DSP’s value lies in reaching the 95% with meaningful, brand-forward messaging before they enter the purchase funnel, so when they do, your brand is the one they seek out directly, bypassing expensive ad auctions and competitors altogether.
That’s not just advertising to drive single-serving sales. That’s true brand building.
💡 You can learn more about Moving From the 5% to the 95% - The Principles of Demand Generation here.
Why DSP, and Why Now?
Amazon DSP has been around for years under previous labels of AAP and AMG, evolving from early managed services into a robust programmatic platform. In 2025, DSP sits at a unique inflection point: mature enough to offer industry-leading capabilities, yet still rapidly improving.
Three forces drive the urgency around DSP adoption today:
1. The State of the Competitive Market
The competitive landscape has shifted. CPCs are at an all-time high. ROAS is harder to sustain. Brands that are allocating 70%, 80%, even 90% of their media budgets to search are discovering a painful truth: you can’t scale profitably by only capturing existing demand.
That’s the 5% of shoppers who are already in-market. Everyone is fishing the same pond, using the same keywords, the same creative, and offering the same discounts.
DSP can help you expand reach beyond the Amazon search bar, tapping into premium inventory across the open web, connected TV, audio, and mobile.
It’s how brands reach the next customer, not just the current one.
2. Fragmented Shopper Journeys
Long gone are the days when consumers follow a neat, linear path from awareness to purchase. Today, they’re exposed to media in their cars, at the gym, on social platforms, in-store, and on Amazon.
Discovery might start with a TikTok video, jump to a Google search, lead to a purchase of a trial size in a physical store, then convert to a subscription order on Amazon. Brands that rely on anachronistic attribution models are falling behind. DSP is built for this nonlinear reality. It allows brands to measure performance across a consumer’s entire journey, not just at the moment of conversion.
And with tools like streaming TV and online video (OLV), you’re no longer limited to static banners - instead, engaging shoppers with rich, immersive storytelling across premium content.
3. A Radically Upgraded Toolset
The DSP platform itself has advanced dramatically. These tools aren’t theoretical; they’re live and driving results today.
We’re talking about:
- Streaming TV (STV) with premium placements during high-impact content
- AMC-powered lookalike audiences built from your highest-value customers
- Online video campaigns that pulse during key seasonal windows
- Conversion path reporting that proves how DSP influences sponsored ad performance
- Category insights and gateway ASIN analysis that map out cross-portfolio growth opportunities
The DSP 2.0 Era is up for grabs. But are brands ready to embrace the new reality?
Rethinking Budget Allocation
One common trap brands fall into is framing DSP investment as a budget reallocation exercise: "How much search spend should we move to DSP?" This binary framing represents a false dichotomy.
Search and DSP are not mutually exclusive; they’re complementary. One captures demand, the other creates it.
Instead of shifting dollars within performance media, the real opportunity is to evaluate DSP against traditional brand budgets: linear TV, upper-funnel social, or other underperforming awareness channels. Often, DSP outperforms these on both efficiency and incrementality.
But for brands to act on this, leadership must align incentives across teams. If channel teams are siloed and compensated based solely on their own performance metrics, they will naturally resist cross-channel strategies.
So in this case, the solution is not more reporting, but better alignment around business-wide outcomes.
A Crawl-Walk-Run Framework for DSP Adoption
But DSP can feel overwhelming. With a flood of new formats, targeting capabilities, and reporting tools, it’s easy for brands to get stuck in analysis paralysis, or worse, launch underwhelming campaigns that get judged against the wrong KPIs.
To make DSP more approachable, it helps to view adoption through a crawl-walk-run framework aligned to three variables:
- Media focus (what you’re paying for)
- Audience targeting (who you’re reaching)
- Key metrics (how you evaluate success)
Whether you're just testing the waters or looking to unlock more advanced capabilities, here’s how to think about each stage:
Crawl: Foundational DSP
Objective: Build confidence and prove basic ROAS
Media Focus: Lower funnel
Audiences: Retargeting (cart abandoners, detail page viewers), contextual segments
KPIs: ROAS, purchase rate, clicks, conversion rate
This is DSP’s entry point, especially for brands under budget constraints or needing to show short-term results to finance teams.
Foundational campaigns lean heavily on remarketing tactics to capture shoppers who have already shown intent. While this doesn’t grow the brand, it offers a safer starting point that mirrors familiar performance media goals.
It’s also where many CFOs feel most comfortable. The ROAS is tangible. The reporting is familiar. But it’s not the endgame, it’s the foot in the door.
Walk: Intermediate DSP
Objective: Build awareness and consideration
Media Focus: Mid-funnel (consideration, light awareness)
Audiences: Amazon Marketing Cloud (AMC) audiences, search-based audiences, in-market lookalikes
Tactics: Online video (OLV), AMC integration
KPIs: CTR, Detail Pageviews (DPV) and Detail Pageview Rate (DPVR), Add-to-carts (ATC), New to Brand (NTB)
Once you've proven basic performance, it's time to move up the funnel. Intermediate DSP introduces more proactive audience-building strategies, targeting shoppers who aren't actively searching for your product yet, but fit your customer profile.
This is where Amazon Marketing Cloud becomes critical. With AMC, brands can build audience segments based on past shopping behavior, search intent, and product interactions. You’re no longer just harvesting demand, you’re planting seeds.
Expect longer attribution windows and more nuanced performance metrics. That might make some stakeholders uneasy, but this is where the groundwork for real brand growth gets laid.
Run: Advanced DSP
Objective: Accelerate brand growth and scale reach
Media Focus: Full-funnel brand-building
Audiences: 1P audience uploads, custom AMC audiences, category insights
Tactics: Streaming TV, OLV pulsing, product and brand boosting, multi-ASIN journeys
KPIs: NTB, brand lift studies, reach, impressions, incrementality metrics, SOV, organic growth
This is where DSP becomes a strategic differentiator. A marketer’s playground.
Brands operating at this level are leveraging Amazon’s most advanced features: streaming TV placements on premium inventory, AMC conversion path reporting, high-value customer segmentation, and gateway ASIN analysis.
These tools allow brands to map how a shopper enters their portfolio (e.g., buying a single spoon) and how they graduate to larger, more profitable purchases over time (e.g., an entire cutlery set).
At this stage, measurement expands far beyond ROAS. Success looks like increased organic traffic, stronger repeat rates, and reduced reliance on lower-funnel discounts and coupons.
You can put it this way: if you were to turn off ads, you would still see sales come through. That’s brand equity.
Brand New To DSP?
There’s also a fourth tier worth mentioning: doing nothing. It’s where many brands still find themselves in 2025, held back by siloed budgets or unsure how to justify upper-funnel investment.
Having the right team in your corner can make all the difference. Don’t leave long-term growth up for grabs. Reach out to explore how we can help you unlock DSP's full potential.
Measuring What Matters
“We tried DSP. It didn’t work.”
More often than not, that failure wasn’t about poor performance; it was about poor expectations.
Too many brands launch DSP campaigns aimed at building awareness or increasing consideration, then kill them prematurely because ROAS didn’t spike within 14 days.
On the flip side, agencies sometimes oversell "cheap impressions" and "great CPMs" without clarifying how those translate to meaningful business impact. Everyone ends up frustrated.
Here’s the core problem: brands aren’t always clear on what success looks like, and they’re even less clear on how to measure it.
If you're investing in DSP to grow your business, you need to anchor every campaign to a specific goal along the customer journey and match it with the right metrics.
Start With the Right Question
What part of the funnel am I trying to grow?
- Is it awareness: getting new eyeballs who’ve never heard of your brand?
- Is it consideration: nudging semi-interested shoppers toward your products?
- Is it conversion: bringing cart abandoners back to finish a purchase?
- Is it loyalty: re-engaging previous customers with high LTV?
Your measurement strategy should ladder directly to that answer.
No-BS DSP Metrics That Actually Drive Business Decisions
Here are some of the most effective, no-nonsense ways to measure DSP impact, aligned with your intent, not vanity numbers:
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Branded Search Lift
If the goal is long-term brand building, track whether more people are searching for your brand name over time. That’s a direct signal that you’ve made an impression, literally and figuratively.
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New-to-Brand Metrics
If you're not bringing in new customers, you're just re-targeting the same people over and over. New-to-brand is essential to avoid overfishing your existing audience pool.
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AMC Conversion Path Reporting
Use Amazon Marketing Cloud to see how DSP exposure influences conversion downstream. For example, Customers who see three DSP ads and then click a Sponsored Product ad tend to convert at a higher rate. Show that data to your CFO: they’ll understand the value of DSP immediately.
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Share of Shelf & Share of Voice
These metrics aren’t always in the default dashboard, but they matter. If your visibility across the category is increasing while organic sales are climbing, you're not just driving ad performance. You’re building equity.
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Gateway ASIN Analysis
Identify which entry-point products lead to longer-term portfolio growth. Did they buy one spoon, then come back for a full cutlery set? DSP helps you target that first spoon shopper more intelligently.
Expand Your Time Horizon
One of the most important mindset shifts is to stop evaluating DSP in 7-, 14-, or even 30-day windows. If you're investing in the 95% of shoppers who aren’t in market today, you can’t expect them to convert like they’re ready to check out tomorrow.
That doesn’t mean you can’t measure. It means you need to measure the right things over the right timeframes. Think:
- Are we driving more branded searches?
- Are new customers coming in?
- Are Sponsored Ads performing better when paired with DSP?
- Is our cost to acquire a customer dropping over time?
If the answer to those is yes, then DSP is working, even if your last-attribution ROAS doesn’t show it immediately.
What’s Hot in DSP Right Now: Team Favorites
Amazon DSP has evolved fast, but we definitely have our favorites. Here’s what we believe deserves a 10 on the DSP hype meter in 2025:
1. Streaming TV (STV) Inventory
For many brands, STV still feels out of reach. The word “TV” triggers legacy assumptions: big budgets, long lead times, and vague impact. But Amazon’s STV offering has flipped that narrative.
It’s now fully accessible within DSP and allows brands to place high-quality video ads within some of the most viewed and premium content available, on platforms like Fire TV, Prime Video, and third-party streaming networks.
Why it matters:
- Reach shoppers when they're most engaged
- Build an emotional connection in a non-scrollable environment
- Layer AMC insights to tie exposure to downstream sales
If your brand thinks “TV isn’t for us,” it’s time to reconsider. STV isn’t just TV, it’s high-impact, addressable, measurable media.
2. Online Video (OLV) Pulsing for Tentpole Events
Always-on campaigns are great, but brands are now using OLV pulsing to layer bursts of targeted awareness around key retail moments.
Instead of just "set it and forget it," this approach allows advertisers to temporarily dial up brand visibility for specific ASINs during high-stakes windows. Think holidays, product launches, or category takeovers.
Why it matters:
- Amplifies lower-funnel campaigns with brand momentum
- Supports both product and brand boosting
- Helps ensure your hero ASIN is top of mind before the shopper starts searching
It’s not just more impressions, it’s intentional timing that builds mental availability.
3. High-LTV Lookalike Audiences via AMC
Not all customers are created equal. Some buy once and bounce. Others come back again and again.
Using AMC, brands can now identify their highest lifetime value shoppers and build lookalike audiences for DSP based on shared behaviors, not just demographics. These are the people most likely to become your next best customers.
Why it matters:
- Focuses spend on profitable acquisition, not just on reach
- Moves DSP from broad awareness to high-quality awareness
- Helps scale customer lifetime value over time
Instead of asking “how many people saw my ad,” the better question is: were they the right people?
4. AMC Conversion Path Reporting
One of the biggest breakthroughs in cross-channel measurement: AMC can now show how DSP exposure influences Sponsored Ads performance.
You can see, for example, that shoppers who saw three DSP impressions are significantly more likely to click and convert on Sponsored Products later, often at a higher ROAS.
Why it matters:
- Proves that upper-funnel DSP directly feeds lower-funnel performance
- Helps unlock upper-funnel budget from skeptical stakeholders
- Connects brand building to business outcomes with hard data
If you need a CFO-friendly slide to defend DSP investment, this is it.
5. Gateway ASIN Analysis
Not all products in your catalog serve the same role. Some are entry points: what AMC calls gateway ASINs. These are the first products a customer buys that often lead to larger, more profitable repeat purchases across your portfolio.
DSP now allows brands to identify those gateway products and build targeted audiences around them.
Why it matters:
- Lets you target new customers with the exact product likely to get them hooked
- Enables smarter cross-sell and upsell strategies
- Creates a compounding effect on customer lifetime value
Final Thoughts
Amazon DSP 2.0 represents a powerful shift in how brands can drive growth on and off Amazon. With costs rising and shopper journeys becoming increasingly fragmented, relying solely on search and bottom-funnel tactics is no longer enough.
The brands seeing real impact today are those using DSP to build awareness, attract high-value customers, and influence future demand, not just chase immediate conversions.
Success requires new metrics, longer time horizons, and tighter alignment across teams. For those willing to rethink their approach, DSP is proving to be one of the most effective levers for sustained, profitable growth.
Give It a Listen
We also published a podcast episode about this topic.
Check out my episode on the Ecommerce Braintrust hosted by Julie Spear and Jordan Ripley.