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is amazon ppc right for your business?

Sometimes it feels like Amazon is taking over the world. Whatever you need, this eCommerce powerhouse has usually got it.

As Amazon edges closer to becoming the go-to eCommerce search engine, you may be wondering if selling on this marketplace could be an asset to your business? More and more businesses are exploiting Amazon’s potential. If you’re already advertising across Google Shopping and social channels, it’s worth considering Amazon as an additional channel to get more eyes on your products.

Whether you already sell on the platform or you’re just getting started, embarking into the world of Amazon Ads could bring great value to your business.

what you’ll learn…

In this blog, we look at:

  • what amazon ppc is

  • the different types of ads up for grabs

  • whether it’s right for your business

  • how you can get started

what is amazon ppc?

Amazon PPC functions in the same way as you’ll already be familiar with in traditional PPC. An advertiser creates ad campaigns for their products and the platform charges them each time a potential buyer clicks and views the ad.

When Amazon PPC campaigns are created and managed well, they boost visibility of products and help to increase sales. When they perform, a campaign can improve your organic rankings too.

Before we jump into the ins and outs of advertising on Amazon, let’s take a look at Amazon’s key metrics and decode what they mean:

  • attributed sales: This is the total product sales generated from clicks on your ads within one week. Sales data on Amazon can take up to 48 hours to populate so data isn’t always available in the ‘today’ date range.

  • advertising cost of sales: ACoS can be calculated by dividing total ad spend by attributed sales.

  • impressions: This is simply the number of times your ads were displayed.

  • clicks: The number of times your ads were clicked.

Just like Google collects search data, Amazon collects shopper data. This allows you to understand what actions a user took on the website and whether they converted through your Amazon profile. It also allows you to track a clearer ROI which helps you understand how much value your efforts are really generating.

types of amazon ads

Amazon’s PPC ads can be classified into three types:

  • sponsored product ads

  • headline search ads

  • product display ads

sponsored product ads

When a user searches on Amazon, sponsored product ads appear towards the top of the results page, often intermingled with organic results and with ‘sponsored’ displayed next to them.

These ad types are triggered by keywords and search query auctions so it’s important to do your keyword research before setting up your campaign. When it comes to click-through rates and conversions, sponsored product ads usually perform well because they sit with organic results in a more native format.

sponsored brands (formerly headline search ads)

Sponsored brands sit above the organic search results. These ads are also targeted by keywords and operate on a cost-per-click basis but require a higher minimum budget spend than sponsored product ads.

This type of Amazon ad offers the largest range of customisation. You can customise elements of your product pages, search results pages, ad copy and even preferred landing page destination.

product display ads

Product display ads appear on individual product pages either to the side of the displayed product or as the user scrolls down the page in the ‘similar product’ section. These ads can be set up using a targeted product or interest instead of a keyword.

which ad format is right for you?

When you’re choosing an ad for your product, it’s important to consider three points:

  • the type of product you’re advertising

  • your target audience

  • your objectives

Each ad type has different screen placement and budgets but the one thing they all have in common is increasing the opportunity of how many shoppers see your products. Some may perform better based on what you want to achieve, however.

For example, sponsored product ads can be used to target shoppers with higher purchase intent. Whereas sponsored brand ads may be better suited when your aim is to build brand awareness and product display ads could be used for both.

If you’re unsure how to distribute your budget between these three ad types for maximum performance and efficiency, get in touch with our team.

is amazon ppc right for you?

Even if you don’t shop on Amazon, your customers likely will. Almost 90 percent of UK shoppers use Amazon and around 15 million Brits subscribe to Prime. Shoppers use Amazon to read customer reviews, compare prices, ask questions and view product photos.

In terms of conversion rates, it was found that Amazon’s Prime members have a conversion rate of 74 percent while non-Prime members sit at around 13 percent. This means that even Amazon shoppers who don’t have a Prime membership still convert at about five times higher than the average eCommerce website conversion rate.

But how do you know if Amazon PPC will work for you? Will you achieve a decent ROI? How will you make the most of your budget? The success you experience on Amazon can depend on a number of factors:

  • strategy: The perfect product and the perfect ad are just the start. You don’t want to spend too much of your budget on irrelevant keywords or on keywords that are too broad and competitive. Instead, it’s important to continuously optimise your campaigns to ensure maximum exposure and minimum wasted budget.

  • budget: When you’re deciding what your goals are for Amazon advertising, you’ll want to ensure that your budget matches what you aim to achieve. PPC is an effective tactic because you only pay for each person who clicks your ad. The higher your budget, the more potential clicks you’ll receive.

  • ad and product copy: A lot of influence lies with your copy. It needs to convince potential shoppers that your product meets their needs and encourages them to click the ad. If prospects are confused or unsure of what you offer, they most likely won’t engage with your ad which will impact your conversion rate and ROI.

  • visuals: Online shoppers can’t hold, touch or physically see your products before making a purchase. No matter how much budget and time you put into your advertising, your conversions will suffer if your imagery is poor. Your product photography needs to be high quality and clear. Photos should showcase features, different angles and action shots where relevant to give the shopper more insight into what they’re purchasing.

The great thing about Amazon is that this platform already attracts huge numbers of visitors. In fact, Amazon’s UK web traffic jumped 40 percent compared to the previous year which is an increase of almost 13 billion users! Amazon advertising allows you to leverage this traffic. Even better, paid media can help your organic rankings with every sale boosting your position in the Amazon SERPs, regardless of the traffic source.

getting started with amazon ppc

Amazon’s influence in eCommerce only continues to grow. For eCommerce businesses, advertising on Amazon is a no brainer if you want to find and engage customers at every stage of their shopping journey.

Backed by a team of paid media experts, we have the in-house skills and experience to help you reach and convert new customers on Amazon. If you want to know more about our approach to Amazon PPC and the results we could drive for you, get in touch.

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