Amazon DSP Explained: AI-Powered Audience Targeting, AMC and Full-Funnel Growth Strategy

IN BRIEF: Amazon DSP (Demand Side Platform) lets advertisers reach audiences across Display, Online Video, Streaming TV, Prime Video, Twitch, Netflix, and third-party inventory. Amazon's AI solution, Performance+, uses machine learning to optimize DSP campaigns for Customer Acquisition, Consideration, Remarketing and Retention.

Amazon Marketing Cloud (AMC) turns customer journey signals into custom audiences that can be activated in DSP. DSP works best alongside Sponsored Ads, Selling Partner Services (SPS), and Creative Services, connected by a single strategy rather than run as isolated channels, and that strategy should adapt to each brand's stage of growth and each market it operates in. Podean's approach combines Amazon's technology and data with AI and human strategy to build full-funnel growth programs for global brands.

Read on for the full breakdown. 

Before we begin, allow me to paint you the full picture.

DSP stands for Demand Side Platform, which sounds slightly more complicated than it really is. Thankfully, we don't need a 40-slide presentation to explain it.

In simple terms, the name tells us what a DSP does. "Demand" is the advertiser looking to reach potential customers, "side" refers to the advertiser's position in the digital advertising ecosystem, and "platform" is the technology that brings it all together - helping advertisers find relevant audiences, choose the right environments, and compete for advertising inventory across multiple channels and publishers, all from one place: the advertising console, supported by our own Podean in-house tools.

But state-of-the-art DSP has moved far beyond simply buying ad space. It's about making smarter decisions around whom you want to reach, why you want to reach them, where you want to reach them, and what you want them to do next.

Like an advertising octopus with a strategy, rather than eight arms doing eight different things.

Amazon DSP has evolved significantly. Today, it can play a role across almost every stage of the customer journey, introducing a brand to new audiences, building consideration, reconnecting with high-intent shoppers, driving sales and retaining existing customers.

It can reach audiences across Display, Online Video, Streaming TV, Prime Video, Twitch, Netflix and a wide range of third-party inventory.

But having all those options isn't what makes a DSP strategy successful.

The real challenge is knowing what role DSP should play in the wider customer journey, how to use the data available to us, and how to connect it with everything else a brand is doing. That's where Podean comes in, turning the technology, data, and media opportunities into a strategy designed around the bigger picture.

And that's where things get interesting!

DSP is about finding the right customer, right here, right now

One of the most interesting things about Amazon DSP is how much it can tell us about what people are actually doing, not just who they are.

People don't move through the path to purchase in a neat, predictable way. They browse, compare, research, disappear for a while, come back, look at something else, and sometimes finally decide to buy.

Humanity isn't a hive mind.

But when we look at enough individual journeys, patterns start to emerge. The paths may not be identical, but the road most travelled begins to reveal itself. Amazon's signals help us recognise those patterns, understand where people might be in their journey, and make a more informed decision about where to meet them next.

We can reach people researching a category, engaging with products, considering competing products, showing purchase intent or returning to something they've already viewed. Each behaviour tells us something different and can have a very different role in a campaign strategy.

With so many audiences available, the challenge is knowing which ones actually matter to us.

A new product launch might call for customer acquisition. A highly competitive category might benefit from reaching shoppers researching similar products. A brand with strong product interest but a gap between consideration and purchase might focus on remarketing. An established brand might prioritise retention.

The technology allows us to do all of these things.

The audience should follow the strategy, not the other way around. Otherwise, we risk pursuing every possible target while losing sight of the actual objective. Ambition is essential. But some ambitions are better left at rest.

Because ultimately, we're not trying to find any audience.

We're trying to find the right audience for the job we're trying to do.

The funnel isn't really a funnel

The customer journey is often described as:

Awareness → Consideration → Conversion → Retention

It's a useful framework. It's also not really how people behave.

Someone might see a Streaming TV ad, search for the brand a few days later, compare several products, visit Amazon, leave without buying, see another ad, and eventually convert.

Someone else might already know the brand and go straight from a Sponsored Ads search to a purchase.

There are detours, dead ends, U-turns, and the occasional surprise shortcut. Basically, the customer journey rarely comes with a map, and somehow, we're still expected to know where everyone's going.

That's why DSP shouldn't be built around a single stage of the funnel.

All things can be conjoined.

Video and Streaming TV can build awareness and tell a brand story. Display can build consideration and reach relevant shoppers. Remarketing can reconnect with high-intent audiences, while retention activity can keep existing customers engaged.

These aren't isolated jobs. They can work together, with each touchpoint playing a different role depending on where the customer is and what we want them to do next.

This also changes how we think about measurement.

Not every campaign should be asked the same question.

A campaign designed to introduce a brand to new customers shouldn't necessarily be judged purely on immediate ROAS. A campaign targeting people who have already shown strong purchase intent can reasonably be held to a much more conversion-focused KPI.

The KPI should reflect the job the campaign is supposed to do, not simply the metric that's easiest to put in a report.

Where AI starts to make things really interesting

This is where Performance+ adds another layer.

Amazon's AI-powered DSP solution can use machine learning across a broad range of signals to identify opportunities and optimise towards the campaign's chosen objective. It supports strategies including Customer Acquisition, Consideration, Remarketing and Retention, across Display, Online Video and Streaming TV.

But for me, the interesting part isn't simply that DSP now has AI.

It's how we combine AI with human strategy.

The robot and the human need to work as a team. AI is exceptionally good at processing enormous amounts of data, recognising patterns and making decisions at a scale and speed that simply isn't possible for a person.

But AI doesn't know the whole story.

It doesn't know that a client is launching its most important product of the year next month. It doesn't know that a particular category is suddenly the business priority, that a competitor has entered the market, or that expanding into a particular country is part of a three-year growth plan.

AI can see the patterns, but strategy gives them a purpose.

With AI handling the scale and complexity, the person behind the campaign can focus on the strategy, context and decisions that matter, while acting on opportunities that would be difficult to manage manually.

In that sense, AI offers us an accord: more scale, more speed and more intelligence.

Knowing where we actually want to go, and why, is still our job.

AMC: turning data into audiences

Then there is Amazon Marketing Cloud.

AMC is sometimes treated mainly as a reporting and measurement solution, but that undersells what it can do.

It provides a privacy-safe environment where eligible Amazon Ads signals and other permitted inputs can be analysed to understand customer journeys, campaign interactions and audience behaviour.

It also allows us to connect signals across different campaigns and touchpoints, helping us understand how customers move through the journey, rather than looking at each interaction in isolation.

And those insights can be turned into custom audiences that can be activated in Amazon DSP.

Instead of only asking:

“Which Amazon audience should we target?”

we can ask:

“What specific group of people would be most valuable for this particular strategy?”

We could identify shoppers who repeatedly engaged with a product but didn't purchase, customers who bought one product but might be relevant for another category, or people who interacted with several touchpoints without converting.

We can also use AMC to investigate questions around audience overlap; frequency, conversion paths, and the role different touchpoints play in driving results. The possibilities depend on the business question.

And this is where having the right expertise really matters. Podean has dedicated AMC experts who can turn these more complex data questions into actionable insights, audiences and media strategies.

The fallen leaves tell a story. In AMC, the signals left behind by customer journeys can help us understand that story - and, more importantly, decide what to do with it.

That's what makes AMC so powerful.

Data isn't just there to explain what happened after the campaign.

It can help determine what happens next.

DSP doesn't work in isolation

This is where the conversation around DSP needs to become broader.

DSP and Sponsored Ads shouldn't be treated as two teams competing for the same customer or budget. They have different jobs, and they work best when they work together.

DSP can create demand, reach new audiences, build consideration and reconnect with customers across the journey.

Sponsored Ads can capture shoppers when they are actively searching and browsing within Amazon.

One helps create and influence demand. The other helps capture it.

When those two sides are working together, the next question becomes: where do we take the customer?

A DSP or Sponsored Ads click might lead to a product detail page, a Brand Store or another relevant destination. And this is where the experience after the click becomes just as important as getting the click in the first place.

If we're sending someone to a product detail page, the listing needs to do its job. The right product information, content, images, reviews and overall retail experience all contribute to turning that interest into a purchase.

This is where our Selling Partner Services (SPS) team adds another important piece. SPS works with sellers and vendors to improve their presence on Amazon - from product listings and content to the wider retail experience.

If we're sending someone to a Brand Store, the experience needs to feel just as considered. Our Creative Services team can help brands build engaging, on-brand experiences that continue the story started by the advertising.

Otherwise, we're basically inviting someone through the front door and then making them figure out where the house is.

That means we can look at the customer journey from multiple angles: how we reach the customer, how we capture their intent, where we take them, and what they experience when they get there.

The better those pieces connect, the less likely we are to lose customers between the ad and the purchase.

From Amazon strategy to business strategy

The same thinking applies beyond individual campaigns.

Amazon shouldn't be treated as a separate island inside a brand's marketing plan. It should be part of the bigger picture.

A brand might be launching a product, defending market share, increasing penetration, entering a new country or growing an established customer base.

Those objectives should influence the media strategy.

A brand entering a new market may need to invest heavily in awareness and customer acquisition. A brand with strong awareness may have a bigger opportunity in consideration, conversion or retention.

Same DSP. Very different strategy.

And this becomes even more important across multiple markets.

International expansion isn't simply copying the same campaign into another marketplace and hoping for the best. Markets have different levels of brand awareness, competitive environments, customer behaviour, media costs and marketplace maturity.

What works in one market may not work in another.

A strong global strategy should provide consistency where it makes sense, while allowing local teams to respond to what is actually happening in each market.

Think global, act local - or, in DSP terms, don't send the same soldier into every battlefield and expect the same result.

DSP Powered by Podean

This is ultimately where we see the role of DSP Powered by Podean.

Amazon provides the technology, media inventory and incredible depth of data.

AI gives us increasingly powerful ways to process those signals and optimise campaigns.

AMC allows us to understand customer behaviour more deeply and build audiences around specific business questions.

Technology can open more doors, but the direction still comes from strategy.

That is where experience and strategy matter.

At Podean, we don't see DSP as a standalone service that starts with a campaign brief and ends with a performance report.

We look at where the brand wants to go, what role Amazon can play in that journey, and how DSP fits alongside Sponsored Ads, creative, retail strategy, Amazon listings, and the wider marketplace ecosystem.

Because the customer doesn't see these things as separate services.

They see a brand. They see you.

And that means the strategy behind each part needs to connect.

Having DSP, Sponsored Ads, creative and retail expertise working together means the same business objectives can guide how we reach customers, how we capture their intent and what happens when they arrive on Amazon.

That's ultimately what we mean when we talk about full-funnel growth.

More isn't necessarily better. Better-connected is. The strongest strategies are built around activity that has a clear role in the customer journey and a clear reason for being there.

And most importantly, it needs to connect back to the business.

DSP is powerful on its own.

But when you combine Amazon's data and technology with AI, custom audience intelligence, strong creative, Sponsored Ads, SPS expertise and a clear global strategy, it can become something much bigger.

A genuine growth engine.

And perhaps that's the most important shift in how we should think about DSP.

DSP can sit at the centre of the relationship between data, media, customers and business strategy, connecting the different pieces rather than operating as another channel in isolation.

That's what DSP Powered by Podean is built to deliver.

Because in a world where customer journeys rarely follow a straight line, there is always another path to take. The real advantage comes from knowing which one is worth taking. And keeping the flame of ambition burning.