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Digital Marketing | Amazon
Expanding reach in Amazon DSP without raising CPM is possible...
By Vanshaj Sharma
Feb 12, 2026 | 5 Minutes | 
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Getting more eyeballs on your products without watching your cost per thousand impressions (CPM) climb is the holy grail of Amazon DSP advertising. Most advertisers assume that expanding reach automatically means higher costs, but that assumption leaves money on the table.
The reality is different. With the right strategies, you can stretch your budget further and connect with more potential customers without inflating your CPM. This approach requires understanding how Amazon DSP works beyond the surface level and making smart optimization decisions that compound over time.
Before jumping into tactics, it helps to understand why CPM and reach often move together. When you target highly competitive audiences or premium placements, you enter bidding wars with other advertisers. The scarcity drives prices up.
But Amazon DSP offers far more inventory and targeting options than most advertisers explore. The platform includes display ads across Amazon-owned properties, third-party websites, apps, and even streaming content. Each of these channels has different competition levels and pricing dynamics.
The trick is finding where your audience exists in less contested spaces. Not every valuable customer browses the Amazon homepage during peak shopping hours. Many are scrolling through their favorite apps, reading content on niche websites, or streaming shows in the evening. These touchpoints often cost less while still delivering quality impressions.
Broad targeting might seem like the obvious path to greater reach, but it typically inflates CPM because you compete for everyone. Narrowing down to specific audience segments can actually improve both reach and efficiency.
Start by layering audience signals rather than casting wide nets. Instead of targeting all kitchen enthusiasts, combine shopping behaviors with contextual signals. Someone who recently viewed coffee makers AND visits cooking blogs AND watches food content represents a more defined segment. These layered audiences often have lower competition because fewer advertisers build them.
Look beyond in-market audiences too. Lifestyle audiences and contextual targeting based on content consumption patterns can unlock reach at lower CPMs. Someone reading articles about home organization might be receptive to storage solutions even if they have not actively searched for them yet.
Retargeting audiences deserve special attention here. Pixel-based audiences of people who visited your product pages or added items to cart typically have lower CPMs than cold prospecting. You already paid to get them interested once. Bringing them back costs less than finding brand new customers.
Amazon DSP provides access to inventory that most advertisers ignore. Third-party exchanges and supply sources beyond Amazon-owned properties often deliver reach at significantly lower CPMs.
Off-Amazon inventory includes millions of websites and apps where your target customers spend time. The CPMs here can be 30-50% lower than on Amazon properties because competition is lighter. Yes, these placements might not convert as immediately as product detail page ads, but they build awareness and consideration that feeds the funnel.
Streaming TV ads through Amazon Publisher Direct represent another opportunity. Connected TV inventory has grown rapidly, and early adopters in this space often secure better pricing than those who wait until competition intensifies. The reach potential is massive because people spend hours watching content, and your ads appear in full-screen, non-skippable formats.
Mobile app inventory also tends to offer better CPM efficiency than web placements. People spend more time in apps than mobile browsers, yet many advertisers still focus primarily on web inventory. This creates pricing inefficiencies you can exploit.
Bid optimization directly impacts both reach and CPM. Most advertisers set bids and forget them, but dynamic adjustment based on performance data makes a real difference.
Start with lower bids on prospecting campaigns targeting new audiences. You might win fewer auctions initially, but the impressions you do win will cost less. Monitor impression share metrics to ensure you are not bidding so low that you become invisible. The goal is finding the floor where you still compete but avoid overpaying.
Dayparting your campaigns can reduce CPMs dramatically. Bidding aggressively during peak shopping hours (evenings and weekends) puts you in direct competition with everyone. Shifting some budget to off-peak hours like weekday mornings can deliver reach at 20-40% lower CPMs. Your ads still run, customers still see them, but you avoid the pricing peaks.
Geographic targeting also affects CPM efficiency. Major metro areas like New York and Los Angeles have higher competition and costs. Expanding into secondary markets or rural areas can boost reach while lowering average CPMs. Not every customer lives in a tier-one city, and those in smaller markets have the same needs and buying power.
Higher engagement rates improve your effective reach without raising CPMs. When people interact with your ads through clicks or video completion, the algorithm rewards you with better placement opportunities at similar or lower costs.
Test multiple creative variations regularly. Static images, animated GIFs, and video each have different engagement patterns. Video often drives higher engagement rates, which can lower your effective CPM over time as the platform favors your ads in auctions.
Size matters too. Offering multiple ad sizes ensures you compete in more auctions across different placements. Some placements only accept certain dimensions, and if you only have one or two sizes, you miss opportunities entirely. Creating 5-6 standard sizes costs little but can expand reach considerably.
Refreshing creative every few weeks prevents ad fatigue. When people see the same ad repeatedly, engagement drops. Lower engagement signals to the algorithm that your ads are less relevant, which can increase CPMs as you need higher bids to maintain visibility. Fresh creative keeps engagement healthy and costs stable.
Frequency caps prevent showing the same ad too many times to one person. While this protects against annoying customers, it also impacts reach and CPM efficiency.
Setting frequency caps too low forces the system to find new people constantly, which often means bidding higher to access fresh inventory. Relaxing frequency caps slightly (from 1-2 impressions per day to 3-4) allows the system to deliver more impressions to known audiences at lower costs.
This feels counterintuitive because marketing wisdom says not to spam people. But there is a difference between 3-4 impressions per day and 20. Most people need multiple touchpoints before taking action anyway, so moderate frequency actually improves effectiveness while reducing average CPM.
The key is monitoring engagement metrics. If click-through rates or conversion rates drop as frequency increases, you have pushed too far. But if performance stays stable, the lower CPMs from higher frequency directly improve campaign efficiency.
Improving reach without inflating CPM is not a one-time fix. It requires ongoing testing, monitoring, and refinement. The Amazon DSP auction dynamics shift constantly as more advertisers enter the platform and customer behaviors evolve.
Set up regular reporting that tracks both reach metrics (unique users, impressions) and efficiency metrics (CPM, cost per acquisition). When reach grows but CPM stays flat or decreases, you know the optimizations are working. When both increase together, you need to adjust.
The advertisers who succeed long-term treat this as a continuous process rather than a campaign setup task. Markets change, audiences shift, and inventory availability fluctuates. Staying ahead means staying active in optimization rather than setting and forgetting campaigns.