The Power of Amazon Ads

Matthew Smokowski

Lead PPC Strategist

If you haven’t taken advantage of Amazon’s Pay Per Click (PPC) advertising platform just yet, this article is for you!

It can be intimidating to get your products on Amazon because it’s such a large ecommerce site with a lot of competition. Not only are you selling against other ecommerce stores but also Amazon itself!

Nevertheless, you didn’t get into sales to sit back and watch everyone else make money, so Amazon is an opportunity that you don’t want to pass up.

In this post, we are going to go over Amazon’s PPC platform in brief, how to setup your first campaign and the power of Amazon ads overall.

How Amazon’s PPC Platform Works

Amazon receives millions of searches each month, and the majority are long-tail searches from people who are ready to buy. In other words, people don’t come to Amazon to window shop and discover new products. They know exactly what they want to buy, and they’re often in a position to buy it.

When a user searches for a particular product, there are two types of results that are returned to them: the organic results and the paid results. The results are mixed in together, for the most part. You’ll see that the paid results are on the right-hand side and also embedded with the other results.

In order to get your ads featured, you need to create an optimized PPC strategy based on Amazon’s platform. This involves running campaigns to find profitable keywords that convert to sales, removing non-converting keywords and increasing bids for keywords that convert well.

How Amazon Measures Success

Amazon has its own metrics that are used to determine the effectiveness of a campaign. These include:

  • Advertising cost of sales: The percent of attributed sales spent on advertising.

  • Attributed sales: The total product sales generated within one week of clicks on your ads.

  • Impressions: The number of times your ad was displayed.

  • Clicks. The number of times you ad was clicked.

Now that you know how Amazon describes their metrics, let’s move onto why we think Amazon Sponsored Products is an awesome addition to your ecommerce strategy.

Benefits of Advertising on Amazon

Amazon is an international ecommerce company, and the leading e-retailer in the United States with more than $107 billion in 2015 net sales. It’s considered one of the most valuable brands worldwide because of its international appeal.

To think that you won’t find your audience here is almost silly. Though Amazon is known for its electronics and digital content, you can nab pretty much anything on the site including groceries, baby items, pet products and household gear.

Let’s review what makes Amazon advertising so powerful for small and big brands alike.

  • Sellers can use Amazon’s fulfillment services to pick, pack and ship to the customer on their behalf.

  • Sellers can offer free shipping to customers through Amazon’s Prime Membership program.

  • Amazon offers a range of advertising options, such Display Advertising and Sponsored Products.

  • Amazon’s advertising solutions appeal to both small retailers as well as large retailers, leveling the playing field.

  • Amazon’s PPC platform is competitive; you’re not charged unless someone clicks on your ad. You may also optimize campaign performance and monitor your success.

Setting Up a Campaign

If you’re ready to give Sponsored Products a try, setting up a campaign is pretty straightforward.

Start by naming your campaign and determine on a budget. Your budget is completely up to you, but many companies will start at $50-75 a day. (This is the maximum limit, not the amount that you will spend.) Amazon also has a bid-adjustment feature like Google and Facebook.

Now it’s time to create your first campaign. Amazon makes it stupid simple, so don’t think you’re missing something. Fill in the form fields, which include:

  • Campaign name

  • Average daily budget

  • Start date/end date

  • Targeting type

For the last option - targeting type - you have two choices: automatic targeting or manual targeting. Automatic targeting targets your ads to all relevant customer searches, while manual targeting targets ads based on the keywords you choose.

Once you select your targeting type, you can follow the rest of the campaign setup, which includes adding keywords and setting a bid for the keywords. Then, watch the magic happen!

It’s very possible that you won’t see any sales in the first few days, but don’t worry. It can take 48-72 hours for conversions to be reported. Let your campaign run itself in the first week, and then you can collect data to optimize your campaigns for the future.

Optimizing Campaigns

As you gather data from your campaigns, there are a few things to be mindful of so that you can refine and optimize future advertising strategies. Below are a few things to focus on.

  • Filter keywords by Average Cost of Sale (ACoS): Discover which keywords are converting and which ones aren’t. Pause keywords that have a high ACoS and consider increasing the bid for keywords that are below your ACoS.

  • Filter by order numbers: Determine which keywords are driving the most conversions and cross-reference them with how much it costs to get the sale.

  • Filter keywords by spend: Realize which keywords you’re spending money on. Make sure that you’re investing in keywords that are giving you a return.

  • Bids: Identify keywords that are converting but have an ACoS that’s higher than your target. You don’t have to pause them, but rather adjust your bid.

  • Negative keywords: You can use broad match to trigger your ad for certain search queries, but it’s the only match type that Amazon offers. If you want more control over your searches, you’ll need to employ negative keywords.

Conclusion

Amazon’s ad solutions are worth looking into. Even though the marketplace can be extremely competitive, most companies are finding that the ecommerce giant brings them a return on their investment. The platform is very simple to use, and you can gather data to optimize your campaigns within one week. Best yet, Amazon gives small and large retailers the same opportunities for success.

 

About the Author: Matthew Smokowski

Matt is a PPC Strategist for SEMGeeks. He has a background in English and Creative writing and experience managing PPC campaigns for popular local businesses. He excels at creating creative ad copy, landing page content, and progressive PPC strategy. Matt has become the resident Amazon and Instagram Marketing Expert.

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