February 2, 2024
Introduction Amazon is ultimately a search engine that runs on a pay-per-click (PPC) model. You show your ads to chosen audiences and for chosen keywords, similar to Google Ads. So, if you understand PPC or search engine marketing (SEM), then you’re almost there with understanding Amazon Advertising.
Like PPC, Amazon Advertising is very efficient. You only pay when someone clicks on your ad, and impressions are free! However, you need to sell your product in order to gain a conversion and your click-through rate (CTR) drops significantly when you’re not at the top of search results, much like with PPC marketing. Getting to the top of search results can be done organically but this takes time, so having Amazon advertising as part of your eCommerce strategy is a great way to gain exposure for your products quickly and at volume.
The Amazon Algorithm Before you begin, it’s important to understand Amazon’s algorithm and take into consideration the key factors that play into both organic and paid performance. This will help you to ensure your products are visible to potential customers. These factors include:
Since Amazon is a marketplace where users have a vast amount of choice, these factors will help to boost your product rankings and increase your chances of winning the buy box. Our friends at Search Engine Land have a guide on how best to do this.
Top tips for Amazon Advertising strategies:
1. Outline your goals
This is the first step to success. Be clear about what you want your campaign to achieve and establish goals to work toward. It’s possible to have more than one goal, but the goals need to complement each other. For example, if your goal is to achieve sales volume, then an efficiency metric such as cost per action (CPA) or return on advertising spend (ROAS) would become secondary, as the two work against each other.
2. Choose the right campaign
The next step is to choose the right campaign type for your goals. For example, Sponsored Product Ads offer an efficient way to highlight specific products and drive sales; however, if your goal is to increase brand awareness, Sponsored Brands could offer you a better solution.
3. Set a budget
This is something that many businesses struggle with, especially if it’s their first time using Amazon Ads. The WMM team works with you to help you to establish a sufficient budget that you’re comfortable with to get started. With high potential conversion rates available via Amazon Ads and digital ad spend exceeding $560 billion, we’re confident that branching into the world of Amazon Ads will pay off your business.
4. Choose the right products
It’s important to choose products that align with your budget and consider the expected cost per click (CPC) that your campaign will achieve. A low priced product might not be the best choice for a Sponsored Ads campaign considering your profit margin. You can easily identify which products to choose using the data available in your Amazon Seller Central Dashboard. During selection, choose products with a good amount of traffic, higher price points and higher margin as demonstrated below:
5. Use good quality visuals
Online shopping has become extremely popular over the years; however, there are still some limitations for shoppers buying online. Good quality images and videos can help potential buyers to interact with your products and gain you higher conversion rates for your campaigns! We advise using a selection of product and lifestyle images, plus 360-degree rotating images and videos where possible.
6. Write clear engaging ad copy
Incorporate keywords where possible in your ad copy, but don’t overuse them or place them where they don’t read well just for the sake of it.
7. Target the right audience
Choosing the right target audience to sell to will help boost your CTR and conversion rates, maximizing your sales in return for your budget. You can identify the right target audience using Amazon’s Ad Manager. Choose groups that align with your product and brand, including lifestyle and in-market audiences with high purchase propensity.
8. Add negative keywords
Negative keywords can help to refine your targeting and save you money! Amazon’s algorithm is great at finding opportunities to sell your products based on similar keywords; however, it can also bring in irrelevant search terms. Staying on top of negative keywords throughout campaigns is important for efficiency.
9. Test and learn
Test and optimize different elements of your campaign, including ad copy, keywords, chosen products and audiences.
10. Ensure your products have enough stock
Last but certainly not least, ensure that the products you choose to promote via a Sponsored Products campaign meet Amazon’s requirements and make sure you have enough stock to fulfill the potential sales of the campaign. If your products go out of stock, the campaign instantly becomes ineligible.
Conclusion:
There are lots of benefits to using Amazon Advertising. It’s a quick and easy way to gain visibility and achieve sales and high conversion rates with customers who are actively searching for your products.
One thing to note, it’s important to spend time getting your product pages in good order before investing money in Amazon Advertising. Investigate and learn from the data that’s available to you to refine your keywords and audiences, and then continue to test and learn from that data once the campaigns are up and running.