Amazon advertising is not what it used to be–no longer are the days of simple sponsored product ads.
Amazon advertising has grown beyond that and into a wide display of ad offerings for Amazon sellers to increase revenue and gain new customers.
Amazon advertising has steadily increased in its complexity in recent years, and the advertising display options have improved to increase traffic even more for Amazon sellers.
How can using Amazon advertising increase revenue and gain new customers for your business?
Recently, I spoke with one of Cascadia’s advertising specialists, Autumn Echols, to find the answer to this question and discover exactly how using Amazon advertising to increase revenue and gain new customers is entirely possible for Amazon sellers.
Amazon Marketing Services is now Amazon Advertising
Amazon Marketing Services (AMS), Marketplace Advertising, and Amazon Media Group (AMG) were all merged into one group, Amazon Advertising, nearly two years ago.
Amazon Advertising is Amazon’s Pay-per-click (PPC) platform where sellers can get their products in front of relevant visitors based on keywords, products, and shared interests.
Autumn highlighted how we use Amazon advertising here at Cascadia Seller Solutions and explained, “we follow an advertising process sort of similar to that of a sales funnel, [but] we first try to generate a lot of traffic and reach new customers.”
If you don’t currently have traffic to your product page, advertising will help you start the flywheel of growth. The more traffic (and conversion!), the more traffic Amazon will send your way. Advertising helps you reach prospective customers more consistently and more quickly than allowing the system to operate on its own without advertising.
Advertising anywhere, let alone on Amazon, is a flywheel, where success grows more success. At Cascadia, we run Amazon Automatic campaigns and product targeting manual campaigns that target hundreds of keywords and products on Amazon that are similar to the client’s product. This then teaches Amazon’s automated algorithm to keep showing the product for those keywords and product pages, even when we’re no longer paying for the ad.
Amazon Advertising includes the following services:
- Storefront and Storefront Brand Ads: A feature that allows brands to create a customized website within Amazon and dedicated landing pages for an individual product, which gives sellers visibility on the Amazon Marketplace through store feature ads.
- Product Display Ads: Now called “Sponsored Display Ads,” this is a feature that also increases exposure for Amazon sellers with the key difference being it is a remarketing tool, targeting potential buyers and customers who have already purchased or looked at your product or similar products.
- Headline Search Ads: This feature allows sellers to promote their products and brands that are targeted by keywords and are operated on a cost-per-click basis. This type of ad is located on the very top of the search results page, spanning across the page, with only one Headline Search Ad per search results page.
- Sponsored Products Ads: This ad feature is similar to Headline Search Ads, but Sponsored Products Ads are cost-per-click ads that appear at the top and bottom of the search results page, within organic search results, and on the carousel of product detail pages.
- Posts (beta): a brand feed with pictures – similar to Instagram – that feature a particular product or set of products that then show on competitor product detail pages
- Video Ads (beta): a video of between 8-45 seconds plays next to your product’s thumbnail, review rating, and title, allowing people to visually learn about the product and click on the link to learn more.
There is a caveat for Amazon Advertising as there is with many other aspects of Amazon’s seller features–you must qualify for the services.
In order to gain access to Amazon Advertising, you must have one of the following:
- Seller Central
- Advertising console
- Amazon DSP console
Amazon Advertising is one of the best ways to increase traffic and new customers to your brand and product because Amazon is and continues to be one of the most used websites for consumers’ shopping needs.
You could go as far as to say that Amazon and online shopping are synonymous, and if we’ve learned anything from this year, it’s that online shopping and Amazon are not going away anytime soon.
Amazon PPC (pay-per-click) is an advertising model in which advertisers pay a fee to Amazon when a shopper clicks on their ad – there are no current ways for Amazon to monetize impressions of videos or engagements with posts… but we bet they’re working on it!
Autumn, one of our advertising aficionados, explains, “really you are only paying for clicks, but if you win the bid and someone clicks on your sponsored ad, it will cost you money, and the more you bid, the more you pay for a click.”
Hence, the title of this form of advertising being “pay-per-click” or “cost-per-click.”
With our Whidbey package, we include the following to help boost your product and brand’s visibility:
- We create and manage all your ads for you!
- We give you detailed feedback on how you can update your listings and content for optimal conversion with examples of what those images or videos should look like.
- We contact Seller Support for any advertising errors or promotions errors so you don’t have to!
- We’ll provide detailed feedback on A+ content and Storefront content that you should create.
- This service level covers unlimited monthly ad management.
Since Amazon is one of the biggest players out there, Amazon shoppers have a higher probability to purchase a product from the website rather than anywhere else. Overall, this guarantees better sales conversions for sellers.
Our Approach as an Amazon PPC agency
Because we come from a content and product marketing perspective, we see advertising as an extension of pitching the product, rather than as a separate function all on its own. As such, we never look at advertising ONLY through the lens of PPC or percentage performance; rather, we look at Amazon Advertising as an opportunity to get new customers to the page, and pitch the product to them – and then see what pitch seems to work best for them.
Our process is to let customers tell us what matters to them. To do this, we start with automatic campaigns.
Automatic campaigns are products and keywords Amazon selects to bid on, based on what their automated algorithm determines is relevant to your product.
After getting auto ads set up, we then set up product targeting ads – and we generally start with what Amazon recommends to see what kind of traction we can get.
Product targeting manual ads are ads that bid with other brands to sit on certain product listing pages. Whoever bids the highest wins the ad spot, whether that is for a typed-in keyword sponsored ad or for a sponsored product on someone’s listing.
These auto or product target campaigns may or may not be successful, but we don’t know until we run them and see, so we bid on a bunch of products and keywords – the birdshot approach!
This phase is essentially the customer behavior research phase and helps us gain insight into what words people are using as search terms and what terms and products are converting to sales for the client based on those keywords and products.
When we have a better idea of what customers are – and are not! – responding to, then it’s time for targeted keyword campaigns. One of the most common mistakes sellers make is bidding on top performing keywords that they want to rank for, without seeing what customer actually responds to. Maybe that top performing search term on Jungle Scout or Helium10 is a fantastic fit for your product… but maybe it’s really not.
After running the initial research ads, we start to optimize those campaigns and target the most successful keywords and products that yielded a high conversion rate or had a lot of clicks and a good amount of sales from those clicks.
Amazon offers reports with this information called Search Terms report.
We then take the keywords and products that were successful and run ads targeting those, so we don’t waste money on keywords and products that don’t convert.
NOTE: If you are aiming to try to take spot #1 for a particular keyword and you’re willing to pay for the privilege, we can help you do that too. However, most of our clients have fixed budgets for advertising and promotions and don’t want to spend thousands of dollars in PPC advertising to get to page one, now that it’s almost impossible to use super URLs and other tools to cheat and get to page one. Further, it can sometimes take months to establish your position, leading to a huge outlay of cash without limited guarantees of success.
We mentioned above that we run product ads – some product ads do very well for the product sales. For those items, we also run ads that target competitors’ brand names and the keywords they’re ranking for. You can use a reverse ASIN lookup tool to search competitor ASIN keywords – sites like Merchantwords offer this tool.
We are cautious here too though – long experience has shown us that some of these data points can result in a very expensive learning curve! We see your advertising budget as a fiduciary duty when we’re managing your ad spend, and will not take unreasonable or undue risks – unfortunately, this was a lesson learned the hard way, and we try not to make the same mistakes twice!
The best part of using the search term report is that once you start to identify which keywords bring sales, you can then use them in your listings to drive sales and for other types of more expensive ads like Sponsored Brand Ads.
You can also expand even further after a while of running ads and getting sales and start bidding a lot on the most successful keywords to try to gain rank and get to the top of page one for certain keywords.
NOTE: This is the method we recommend for those with a managed advertising budget – start from the customer and work backwards, rather than selecting top performing keywords and dumping money into them up front.
It can be expensive upfront to run Amazon advertisements as you do research, but it will certainly help you identify what types of ads and targets will be successful and help you sell more products.
Amazon advertising is a great way to gain new customers and increase revenue. But don’t take my word for it!
We like to say Amazon is the dollar-for-dollar best platform to advertise on. How do we know this? The $100 test!
$100 is an arbitrary number, but it shows the value of selling on Amazon compared to other platforms. The CPC, conversion rate, and average rate of return on Amazon are more desirable than Google or Facebook advertising.
If you want to maximize your Return on Ad Spend (ROAS), Amazon is your best option.
Compared to Google, Amazon:
Has a lower average CPC – $0.96 compared to $2.69
Higher average conversion rate – 10% compared to 3.75%
While the author goes on to point out the ways that Amazon’s platform lags behind Facebook and Google for variety and usability of interface, the quality of ROI that can come from Advertising on Amazon blows the other platforms out of the water when it comes to dollar for dollar spend and return (ROAS, return on ad spend) on Amazon.
With that being said… our most recent test combining the targeting features of Facebook with the amazing conversion of Amazon’s Storefronts resulted in a more than 2x higher ROAS than Amazon advertising alone. So don’t write off Facebook and Google just yet… especially if the customer ends up adding to cart on Amazon at the end of your sales sequence.
What challenges have you been facing with your advertising on Amazon? Talk to us in the comments, we love to hear from you!