I Thought Sponsored Display Ads Were a Waste of Time, Here’s Why I Was Wrong

Juan Muñoz is a PPC Specialist at Bobsled, an Acadia company.


I used to completely pass off Sponsored Display ads as an unhelpful targeting tool. A lot of strategic pre-planning without any measurable returns on ad spend made it difficult to see how this advertising method stacked up against other types of Sponsored ads. My attempts to use SD ads never resulted in much success, so I stopped suggesting them to our clients.

But recent changes in the retail world are starting to reflect internally, and now is a better time than ever to reassess every available tool in your belt. New updates to the Sponsored Display ads process make it a viable contender once again. With some of the biggest opportunities for audience and product targeting across all stages of the marketing funnel, it might be worth revitalizing this strategy and getting back on board with SDs.

Competitors are starting to use Sponsored Display ads now more than ever, making it a critical time to incorporate all of your Organizational Factors Driving Amazon Success. Keep reading as I explain the reasons why I was wrong about Sponsored Display ads. Find out how you can stand out with all the creative possibilities when you use this diverse system to your advantage.

 What Are Amazon Sponsored Display Ads? 

Originally released as a method of PPC advertising, Sponsored Display ads have become the cornerstone of creative advertising, proving the power of unique funnel strategies. Not only can they be used both on and off Amazon, but they can also secure an incredibly high-performing and high-paying spot on the first page of search results.

It doesn’t target keywords directly as Amazon DSP does; rather, it uses an intuitive algorithm to help target customer behaviors, trends, sales histories, and more. This is a platform where you can create the rules yourself. SD ads give you everything you need to essentially build out your own marketing campaign.


Source: Amazon.com

As an Amazon shopper, you may find yourself near the “Check-out” button when you notice thumbnail images of products you were just looking at a few minutes before but did not add to your shopping cart. This is a subtle reminder to encourage you to think more about buying those forgotten items. What you are seeing is a Sponsored Display Ad making recommendations based on your own shopping behaviors and activity.

Sponsored Display Ads and DSPs are NOT the Same! 

Again, Sponsored Display ads work a lot differently than the Demand Side Platform (DSP). You can utilize both to reach new audience groups and bring in new traffic, and they can both help you to communicate with consumers in a more interactive way. Their differences may be nuanced, but they are too important not to address here. Too often I see folks confusing the two because they can be used so similarly.

Can both SD ads and DSPs use self-service tools? Yes. Can they both be used on and off Amazon? Yes. Can they use display ads with different creative eCommerce media? Yes!

So, what is the big difference?

There are several distinctions between Sponsored Displays and DSPs:

  • Sponsored Displays are used for PPC ads, whereas DSP ads are CPM or CPT campaigns
  • Almost no initial investment is needed for Sponsored Display ads, with a starting requirement of just $1
  • API access is available for Sponsored Display ads
  • Traffic from SD ads is not directed to DTC sites

We go into further depth about the key differences between Sponsored Display and DSP in our webinar recap guide. Essentially, SD ads are often seen as something that may be easier to start with for brands that don’t have a huge budget to work with but still want to get a creative edge over their competitors.

Still deciding between SD ads and DSP? Get all the details with  Amazon Sponsored Display Vs. DSP!

SD Ads Present a New and Underutilized Opportunity


When it comes down to major targeting efforts, Sponsored Displays offer the most diversity by far. This system will become your best targeting friend at every point of your marketing funnel, helping you make a big impact in a unique way.

Simply put, SDs are a new opportunity for advertisers who have never tried them before - or those who have attempted to incorporate Sponsored Display ads and have seen little to no success. You should consider using them for your campaigns not only for their unlimited potential, but because you can use strategic ad placements to outshine your competitors.

The market is only getting more saturated with eCommerce sellers, and yet only 3% of Amazon’s overall ad spend in 2021 came from Sponsored Display campaigns. Currently, SD campaigns are incredibly underutilized. One major reason for this is that a lot of advertisers aren’t aware of the multi-targeting combinations that you can make yourself with your own SD Ad campaign. Many will apply entire SD Ad strategies around a single part of the funnel without understanding the full range of uses that you can get out of Sponsored Displays.


Source: JungleScout

Customize SD Ads in Creative Ways

There is no other native Amazon tool that offers more diversity in targeting than Sponsored Display ads. There are plenty of broad options that narrow down into specific categories, giving you three major ways to customize the different layers of your funnel.

1. Product Targeting

Product targeting is a great place to start for anyone who is looking to promote products with audiences who are already interacting with your brand on a regular basis. SD ads can suggest previously visited items or even suggest something based on the shopper’s own habits.

2. Remarketing Audience Views

If your brand is in the middle of a remarketing strategy and you are looking to capture new groups of audiences, you can customize your SD ads to reengage shoppers who haven’t visited you in a while. You can also use this method to reach out to customers who may not have purchased from you yet, but have purchased similar products and so may be easily pulled in by what you have to offer.

3. Gauging Audience Interest

You can set a certain period of time (typically the last 90 days) to track visitors who have browsed your shop or traveled through your site. You can narrow it down by a certain type of interest, making it easier to specifically reach customers that you know will love your products. It’s just a matter of getting your items in front of them before someone else does.

Beyond these three major ways of using Sponsored Displays, you can also narrow it down further into interchangeable sub-layers such as “Brand”, “Audience”, “Products”, “Lifestyle”, “Category Targeting”, “Purchasing”, and more. With all of these tools at your disposal, Sponsored Display becomes the ultimate target audience campaign creator.

How to Make Your SD Campaign Successful 

Because there are so many ways to personalize your Sponsored Display ad campaigns to reach your targeted goals, each campaign needs deeper research and a clearer idea of what needs to be done.

I am a big fan of thinking strategically when it comes to the audience or competitor we are looking to target, what category should be utilized, and what ASINs will be used for advertisement. While this adds a couple of extra steps to the initial campaign creation phase, it will allow you to further control your spend with such focused targeting.

Real Clients Show Real Success with Sponsored Display Ads

Recently, I had the pleasure of working with a pet food brand with specific advertising needs. Due to the nature of the products, we decided to create Sponsored Display ad purchases in a retargeting campaign. It is important to target previous customers who purchased something in the last 30 or 60 days, as they are most likely to repurchase this type of product after it runs out in that amount of time. 

Using SD ads, the brand received 15 orders in 30 days with an average ROAS of x26.50. The retargeting campaign created ads within the original ads, essentially ensuring that the sales will come. Within 1 year, the pet food brand received 522 orders with a ROAS of x7.53. This equated to about $20,000 in sales and over 353,000 impressions. 

Awareness Vs. Conversion Vs. Loyalty

You can fine-tune your specific brand goals when using SD ads. Those who are looking to increase market share and generate traffic should customize their ads towards awareness. Narrow down the specified audience and prioritize bids for high impressions.

If you are done trying to grow your clicks and impressions, and you are ready to get some real shoppers into your store, you should focus on the conversion aspect of your campaign. Use SD ads to target past viewers and optimize capturing and conversion strategies.

Lastly, you can announce new products and retain customer loyalty through lower-funnel initiatives. Optimize conversions and target your own brand for repurchases. That way, you will be retargeting previous customers as well, taking advantage of Amazon’s algorithm to bring those audience members in.

Elevate Your Ad Strategy with Sponsored Display Ads and Grow Your Brand 

Imagine a Sponsored Brands ad with far fewer competitors, more placement options, and nearly the same creative options. That explains Sponsored Display ads in a nutshell!

Since it first launched in 2020, it has taken up a very small percentage of all the ad spend share on Amazon. However, SP is also decreasing over the last few years. I predict that SD will become a bigger and bigger piece of Amazon's strategies for brands of all sizes and goals. It doesn’t get better than this for retargeting campaigns, loyalty retention, and overall brand awareness.


Book a FREE consultation with one of our experts today!


Juan Munoz