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28. November 2019

Bye Product Display Ads - Hello Sponsored Display!

In the middle of September 2019 Amazon announced the launch of Sponsored Display Ads (SDA) on the US marketplace in the beta phase. At the end of October it was announced that the new Sponsored Display Ads for vendors will be available on other marketplaces and that they will completely replace the old Product Display Ads (PDAs)!

In this article we give you all the important information about the Sponsored Display Ads and explain the difference to the former Product Display Ads as well as to the Dynamic eCommerce Ads, which seem to be similar at first glance and which can be booked via Amazon DSP for some time now.

Please note: This article describes a new advertising format that is still in beta (November 2019). All content can be changed by Amazon at any time.

Sponsored Display - what is it?

The Sponsored Display Ads are a new advertising format that can be shown both on and off Amazon. They are displayed either based on a selected audience or on products and can have different designs. The ads themselves link to the product detail pages of the advertised products.

German Seller Central Screenshot
German Seller Central Screenshot

On the US marketplace the Sponsored Display Ads are available for both sellers (via Seller Central) and vendors (via Advertising Console). At the end of October, the marketplaces UK, Germany, France, Italy, Spain, India, Japan and Canada also have access - but only vendors for the time being (as at 28.11.2019). Access will be gradually rolled out by Amazon, so it is only a matter of time before sellers (Amazon brand registry required) can also use the Sponsored Display Ads on these marketplaces. The Advertising API has already been activated by Amazon, so that Sponsored Display Ads are already available for service providers.

Sponsored Display - the new Product Display Ads? 

The Product Display Ads (PDAs) are now part of the Sponsored Display Ads. The advertising format therefore continues to exist, only under a different name. The design and placement options below the Buy Box and under the attributes have remained unchanged. Thus, the own logo and a short text can still be integrated into the advertisement.

Examples Sponsored Display Ads (in PDA format)
Examples Sponsored Display Ads (in PDA format)

However, the new Sponsored Display Ads give advertisers even more possibilities: They can also appear off Amazon. When displaying on external pages, the Amazon logo and a call-to-action (CTA) button in Amazon design are also added. The size of the ad can vary. 

Sponsored Display Example (source: Amazon)
Sponsored Display Example (source: Amazon)

Sponsored Display - when and where will the ads be displayed?

As already mentioned above, Amazon rolls out the Sponsored Display ads successively. Therefore, not all targeting and placement options are yet available for every marketplace and every seller type (seller or vendor).

Basically, targeting works on the principle of Product Targeting, as is also known from Sponsored Product Ads. No keywords, but audiences or products can be selected. According to Amazon, there are four options to choose from, which are described below. At the moment, we cannot yet see all of these options in Seller Central or Advertising Console. So far, sellers can only use the "views".

  1. Views
    Your ad will be displayed when potential customers visit the product detail pages of your or similar products but have not yet made a purchase. This is the principle of retargeting. The ad is shown off Amazon on external websites and apps.
    We have already seen this option in an US Seller Central Account. 

  2.  Interests
    If customers' search and purchase behavior indicates interest in product categories that include your advertised products, your ad will be displayed on product detail or search results pages on Amazon.
    We have already seen this option in a vendor account in the Advertising Console.

  3. Products
    As with ASIN targeting, concrete products can be targeted that are similar to your products or complement them. The targeting takes place on product detail pages (like the former Product Display Ads) and other Amazon pages.
    We have also already seen this possibility in a vendor account in the Advertising Console.

  4. Categories
    Similar to category targeting within Product Targeting, different product categories can be targeted. The ads are displayed on product detail pages of products of the corresponding categories or on other Amazon pages.
    We have also already seen the possibility of selecting categories in a vendor account in the Advertising Console. 

Amazon has already announced that targeting based on products and interests is also planned for sellers. Therefore, it will not take long before sellers and vendors have the same opportunities to reach their target groups both on and off Amazon. As soon as there are news, we will inform you in this blog article about it. 

With the launch of the Sponsored Display Ads, Amazon offers the widest variety of targeting opportunities within one advertising format. According to Amazon, the special feature is that the search and buying behaviour of the customers is taken into account when an ad is displayed and that the ad can be shown on external sites. Depending on the "calculated" purchase probability of a potential buyer, bids from Amazon are also dynamically adjusted. As with Sponsored Product Ads, the maximum bid and the daily budget can be determined by the merchant. 

Difference to Dynamic eCommerce Ads

The fact that anonymous customer data from Amazon is used for the placement of advertisements has already been used in the past, for example through Dynamic eCommerce Ads (DEAs). Dynamic eCommerce Ads are a special form of display ads and can be placed via the DSP (Demand Side Platform).

Reminder: 

Until about a year ago, the typical advertising formats (Sponsored Products, Sponsored Brands and former Product Display Ads) could be managed via Amazon Marketing Services (AMS). The Display Ads, on the other hand, were controlled via the Amazon Advertising Platform (AAP). Following the restructuring of Amazon in autumn 2018, everything can now be found under the umbrella of Amazon Advertising. The display formats can be booked via the subordinate platform Amazon DSP.

The special feature of Dynamic eCommerce Ads is that their displayed format is adapted on the basis of customer data in order to achieve a higher conversion rate. Buyers who frequently read product reviews on Amazon, for example, are highly likely to see the star rating of an advertised product on a DEA. Standard content such as product images and titles are always displayed, but Call-to-Action can vary. A background image can also be added. 

Example Dynamic eCommerce Ads (source: Amazon)
Example Dynamic eCommerce Ads (source: Amazon)

The Dynamic eCommerce Ads also offer the possibility to place ads off Amazon. However, their creation is more time-consuming than the Sponsored Display Ads. 

In addition, a DEA campaign is usually more expensive since it is created via the Amazon DSP and requires a minimum budget of around EUR 10,000 in the EU and USD 35,000 in the USA to use the Amazon Managed Service. External service providers, such as BidX, offer the use of the DSP even at lower budgets. Please contact us for further information: DSP Request

Another big difference is the payment method. While the Display ads are paid according to impressions (cost-per-mille - CPM), the Sponsored Display Ads are partly billed per click (cost-per-click - CPC) and partly per CPM (see screenshot). On the Amazon Advertising website, however, only pay-per-click billing has been communicated so far.

Screenshot audience targeting
Screenshot audience targeting

Advantages of Sponsored Display and Dynamic eCommerce Ads

Both advertising formats have the advantage that the ads are also displayed on external sites and thus reach a larger target group. In addition, both ads are created in the familiar Amazon design (e.g. yellow CTA button) - this creates trust with potential customers. Both forms of advertising require little or no design effort, as the ads are created automatically on the basis of the ASIN to be advertised. However, an individual background image can also be created for the DEAs.

Both for Sponsored Display Ads and Dynamic eCommerce Ads, anonymous customer data from Amazon is responsible for a placement. Since Amazon has a huge data pool, the ads can have a high click and purchase probability. The DEAs in particular are target group-specific, as their presentation form and content are dynamically adapted. This is also an administrative advantage and time saving, as the CTA button can automatically change from "buy now" to "pre-order" when the product is no longer in stock. 

The Sponsored Display Ads now also give smaller companies and brands the opportunity to place advertisements on external websites, since the large hurdle of the minimum budget of EUR 10,000, which is required for other display formats within the DSP, is eliminated. 

Initial tests have shown that the conversion rate of Sponsored Display Ads is significantly lower than that of other Sponsored Ads displayed exclusively on Amazon. Both Sponsored Display and Dynamic eCommerce Ads should only be used once all other advertising formats have been fully exploited with products that sell well. Our experience and the performance data of our customers have shown that nowhere is the invested budget used as efficiently as with Sponsored Product Ads or Sponsored Brands. 

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