How to Use Amazon’s New Sponsored Display Audiences

May 5, 2021
By The Badger

Sponsored Display just got even better with four brand-new options for audience targeting. These new audiences allow you to pull off sophisticated targeting, previously only available in DSP, and then zero in on exactly the kind of shopper that would like your product.

Before you dive headfirst into these audiences, you might ask yourself: What are these new Sponsored Display audiences? How do I use them in new or existing Sponsored Display campaigns? Are these new audiences even worth it?

We set out to answer all of these questions as we explore these Sponsored Display audiences.

The Four New Sponsored Display Audiences

It’s common knowledge at this point that Amazon has gathered an unimaginable amount of data on its users. That data is the key force behind these audience types, which are largely based on how shoppers are sorted based on their searching and purchasing behavior.

While by and large, these audiences are fairly loose compared to search or product targeting, they’re tighter than pure demographic targeting. This gives you a healthy medium to expand your awareness among a relevant audience without wasting ad spend on shoppers with no conversion potential.

In-Market

This audience type lets you target people who were recently shopping for products in a given category. This can be great for advertising substitute or complementary products. Active shoppers are the prime target of this audience type.

Lifestyle

This type of Sponsored Display audience was made for driving awareness. Like it sounds, it allows targeting based on shopping behaviors that reflect a variety of different lifestyles.

Amazon analyzes the shopping and viewing behaviors of its users, then sorts them into lifestyle segments such as “Tech Enthusiasts,” “Foodies,” etc. From there, you can target different lifestyle segments based on what makes the most sense for your product.

Interests

This audience targeting type assigns interests based on what products shoppers frequently browse or purchase, then sorts them based on those interests, allowing for very fine targeting. Think of it like turning the “recommended products” feed into a form of targeting.

These audiences can get really specific with what interests they contain, so they’re great if your products cater to a niche interest, like Canadian history or horticulture.

Life Events

Tons of life events– like weddings, new children, and travel– require specialized products people normally wouldn’t put in their cart. Given that these events are usually time-sensitive, getting in front of people experiencing or anticipating that life event is key. That’s where this Sponsored Display audience comes in. For example, if you sell luggage, a good Life Event audience to target would be the “Traveling Soon” audience.

Should I Use the New Sponsored Display Audiences?

Yes, provided you’re ready for them.

If you’re just starting out and you have a really small ad budget, hold off on exploring these audiences for a while. Focus on your bottom funnel first before you start branching out.

If you have enough room in your budget, and your bottom and middle funnel are well-developed, new Sponsored Display Audiences are a great way to introduce the right people to your products if you’re looking for new brand exposure opportunities.

When using the in-market audience, you might have a lower conversion rate than its counterparts, but clicks on Sponsored Display are super cheap right now, so you can rake in more profit even if you get a lot of clicks without conversions.

Generally, with a non-Amazon paid funnel, the upper part of the funnel is much more drawn out than it is with Amazon. With Facebook Ads, for example, the goal action, instead of orders, is getting the user to watch at least 50% of a video ad. The users that complete that goal get retargeted with an ad highlighting the product.

These Sponsored Display audiences are in the same vein as these other forms of upper-funnel digital marketing in that their main purpose is to gauge interest among the most promising shoppers and prime them to click or convert in the future.

Besides, the other option for this kind of targeting, Amazon DSP, is notoriously tough to manage. These new Sponsored Display audiences, while not as comprehensive, are faster to manage, easier to learn, and much more accessible to the masses.

Overall, these new audiences are definitely worthy of your ad spend if you’re in a position to explore Sponsored Display.

Using the New Sponsored Display Audiences

Before you do anything, take a look at your product and figure out which audience type would make sense for it. Does it appeal to people with a specific interest or lifestyle? Is your typical customer someone anticipating some sort of event or life change? Keep in mind that you may find your product works well with more than one audience option.

You might also want to consider testing the waters of Sponsored Display with views remarketing first before diving into audiences.

Remember that Sponsored Display has a low conversion rate when selecting a bid. You can expect a conversion rate of about 2% right off the bat. Start with a low bid (think ¼ to ⅓ of your typical Sponsored Products bid) and slowly inch it up over time to gain impressions.

When setting your target ACOS for Sponsored Display audiences, keep in mind that your metrics between ad types may differ by varying degrees based on your most important KPIs. You’ll want to keep track of your total ACOS, or ACOTS, because you’ll normally get a higher ACOS with Sponsored Display since it’s upper-funnel, but it can lead to more conversions overall.

By tracking things like ACOTS and performance by ad type, you can check whether or not your Sponsored Display campaigns are leading to a boost in your Sponsored Products.

Key Takeaways

Amazon Sponsored Display’s four new audience options are total game-changers for increasing your impressions and market awareness. Before these new audiences, you had to have access to DSP to get this type of refined targeting.

If you want a basic version of what Amazon DSP targeting is like without shelling out thousands in monthly ad spend or having to adjust to an entirely different form of advertising, definitely check out these audiences.

If you have the budget for it and want to boost awareness, definitely take these audiences out for a spin sooner rather than later. Conversion rate may be low, but clicks are cheap, so you want to get that early-mover advantage.

If that low conversion rate scares you, reframe Sponsored Display and think of it in regards to its true purpose. It’s not there to net you sales necessarily, but rather to introduce your audience to your brand so they’re more likely to turn to you later.

When testing these new audiences, start with a relatively small bid and slowly increase it over time. Your metrics will look different than what you’re used to with things like Sponsored Products, so set your goals and expectations accordingly.

If there’s room for it in your budget, your Sponsored Product ads are right where you want them, and it makes sense for your product, you should absolutely take these new Sponsored Display audiences for a test drive. They might become your new secret weapon for expanding your customer base!