Faced with tariff spending fears, brands look to Amazon’s search ads and DSP

According to Pacvue data shared with Digiday, average daily spending by brands on Amazon’s Sponsored Brands and Sponsored Products ads rose 9% year-on-year in first quarter 2025. That’s despite the typical decrease following the holiday season in the prior fourth quarter, suggesting current demand among advertisers is higher than market norms.

Similarly, average daily brand spending on Amazon’s DSP — the way advertisers access its Prime Video CTV ads, and offsite inventory using Amazon audience data for targeting — rose 25.4% year-on-year. A spokesperson for the e-commerce titan declined a request for comment. 

“We anticipate clients will continue accelerating their investment in Amazon, particularly across search and DSP,” said Swapnil Patel, managing director at McKinney.

Patel argued that Amazon’s e-commerce data and performance-oriented toolset made it “a strategic choice for brands looking to drive efficient growth and maximize return on ad spend.”

Amazon Prime Video has been one of the primary lures for brands considering the e-commerce platform’s DSP. According to indie media agency Tinuiti, spending on Prime Video rose 29% between fourth quarter 2024 and first quarter 2025, fueled by competitive CPMs and its large audience of ad-supported users.

Among endemic advertisers — that is, brands also selling products on Amazon — the DSP accounts for 34% of Amazon investment among Tinuiti clients, up 2% from Q4. Investment on both search and the DSP grew, according to Andy Taylor, vp of research.

Tinuiti clients spent 12% more year-on-year on Amazon’s DSP, and 11% more on its search ads during the same period. “It’s a recurring theme with the brands we work with [that the] DSP has been the faster growing part of the Amazon ecosystem. That said, we do continue to see the search part of the business continue to grow as well,” he told Digiday.

Brand marketers have been increasing their investment with Amazon’s DSP for some time, in part a result of the tech titan aggressively wooing their ad dollars. At the same time as it’s been offering financial incentives to buyers, it’s also been courting publishing partners to bolster the inventory available through its DSP.

“We are pushing our clients hard to jump on it,” said Dimi Albers, CEO of Dept.

Digital advertising spend has been gradually concentrating among fewer major players. The IAB’s latest annual report found that four fifths of all U.S. advertising revenue was spent with just 10 companies in 2024. 

With the now-familiar caveat that most companies are still figuring out their precise exposure to tariff cost increases and how those costs impact their marketing plans, marketers’ fear of a recession in the U.S. may well be adding petrol to that fire. 

“For most clients, their primary directive, if they have to cut their budgets, is to keep the lights on. That usually looks like [trying to] capture demand that [already] exists. That’s going to push you into lower funnel channels,” said Stephani Estes, chief media officer at Goodway Group.

“So much of Amazon advertising is performance based that they are very well situated to continue to see pretty strong growth in their advertising business through this kind of scenario,” said Tinuiti’s Taylor. “Advertisers are going to want to focus their ad dollars towards those channels and platforms that are driving incremental performance.”

Any rise in search spending on Amazon is likely an indication of tariff concerns crystallizing in shifting investment habits. “A lot of our brands are scrutinizing their lower-funnel display advertising more heavily this year,” said Zach Ricchuiti, Kepler’s associate vp of client solutions. “With that compression of ad spend, obviously you don’t want to lose visibility in search at all, because the top of the search placements on Amazon still drive, far and away, the highest engagement, the highest sales volume and the most visibility.”

Despite Amazon’s aggressive pitching around the DSP in recent months, the media buyers that spoke to Digiday said the platform hadn’t altered its sales materials or pitch to incorporate a tariffs angle.

“I honestly have not heard anything from our Amazon reps about ad budgets,” said Kathryn Johnson, senior programmatic director at New Engen.

“Amazon has not issued any formal recommendations or guidance regarding budget shifts in response to the tariffs,” added Josh Glenn, vp, commerce & retail media at MindgruveMarcarta.

Though its stance could change, that suggests Amazon executives have chosen to sit back and let circumstances make their arguments for them, rather than stake out ground in a commercial landscape they know is liable to shift on a dime.