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If you’re an Amazon seller, you already know that keeping your ACoS (Advertising Cost of Sales) low is the key to making your ads profitable. But with rising competition and ad costs, how do you advertise smarter—not harder?
The answer: Leverage the combined power of Amazon PPC and Amazon DSP.
This post will discuss strategically using both advertising platforms to drive high-converting traffic, retarget efficiently, and ultimately lower your ACoS.
What Is ACoS and Why Does It Matter?
ACoS (Advertising Cost of Sales) is calculated by dividing your ad spend by the revenue generated from that ad.
Formula: ACoS = (Ad Spend / Ad Revenue) × 100
A high ACoS means you’re spending more to get a sale. A low ACoS means your ads are working efficiently, generating more revenue for less spending.
The PPC Foundation: Control and Conversion
Amazon PPC (Pay-Per-Click) ads are the bread and butter of most sellers. With Sponsored Products, Sponsored Brands, and Sponsored Displays, you can target by keyword, ASIN, or even customer interest.
How PPC Helps Lower ACoS:
- Granular control over targeting: Bid only on keywords that convert.
- Real-time budget adjustment: Pause low-performing campaigns instantly.
- Harvesting high-intent traffic: Capture buyers already searching for your product.
🔍 Pro Tip: Use negative keywords and placement reports to trim wasted spend.
Enter Amazon DSP: Smarter Retargeting Beyond Search
Amazon DSP (Demand-Side Platform) allows you to programmatically buy display, video, and audio ads on and off Amazon. It’s a powerful tool for retargeting and building brand awareness beyond Amazon search results.
How DSP Helps Lower ACoS:
- Retargeting viewers who didn’t convert on your product detail page.
- Creating lookalike audiences based on high-value shoppers.
- Cross-device reach ensures your ads follow your ideal customer across apps, websites, and devices.
While DSP might not always show immediate low ACoS, it reduces the cost of future PPC conversions by warming up your audience.
The Winning Combo: Using DSP and PPC Together
Here’s how to strategically combine Amazon PPC and DSP:
1. Top-of-Funnel Awareness with DSP
Use DSP to build awareness and reach new audiences based on demographics, interests, and shopping behavior. Don’t expect direct conversions—but do expect increased branded searches.
2. Mid-Funnel Retargeting with DSP
Show ads to shoppers who viewed or added your products to your cart but didn’t purchase. This nurtures cold traffic into warm leads.
3. Bottom-of-Funnel Conversions with PPC
Once users are warm, use Sponsored Products and Sponsored Brands to close the deal. These ads target high-intent shoppers ready to buy.
Result: Lower ACoS on PPC because DSP already pre-qualified your audience.
Final Tips for Lowering ACoS
- Analyze your attribution windows: Some DSP conversions take longer to show impact.
- Refine your creatives: Bad creatives = bad performance. Test images, copy, and CTA.
- Monitor blended ACoS: Track performance holistically across both platforms.
- Automate wisely: Use software or Amazon’s tools to automate bidding and budget rules.
Conclusion:
Smarter Advertising = Smarter Profits
Lowering ACoS isn’t about cutting spending—it’s about spending smarter. Amazon DSP and PPC each play a role in a full-funnel ad strategy. When used together, they create a robust ecosystem that attracts, nurtures, and converts your ideal shopper—all while keeping your ACoS under control.
👉 Ready to optimize your ad strategy? Start integrating DSP with your PPC campaigns today and watch your profits grow. Contact EHP Consulting Group to schedule your consultation now. Our experienced consultants are ready to support your growth. Just click here to schedule a meeting with an Amazon expert today.
Written By: Liezel Felisilda
Sponsored by: Amazon Marketplace
YouTube Channel Link: EHP Consulting Group on YouTube
TikTok Profile Link: EHP Consulting Group on TikTok
Email: [email protected]
Number: 925-293-3313
Date Written: April 11, 2025