This guest post by Lena R. Liberman, Content Editor at Seller Labs, details how sellers can tap into Amazon Advertising despite the fact that competition has never been higher.
If I asked you to name the biggest Amazon story of the last year, what would you say? Perhaps you’d answer with “Alexa, Echo, AI, and in-home assistants.” Or, maybe you’d say “the acquisition of Whole Foods and the move into grocery delivery.” And good cases can be made for why either of those Amazon endeavors might be contenders for the biggest Amazon story of the past year.
But for me, as someone who’s done Amazon-related work for a decade and who writes about the world’s largest marketplace as my job, I’d argue that the biggest Amazon story of the last year is the rise of Amazon Advertising.
In fact, I’d say that it’s an even-bigger, more-important story because of what it isn’t, namely a consumer-facing retail product or a service such as Prime. But if you didn’t see this coming, you’re not alone.
Why Amazon Advertising can be a major win for everyone
Amazon Advertising turns out to be quite sophisticated, as it’s really a double sale.
The first part of the sale occurs when Amazon merchants bid on keywords that can win them premium position for their products (a banner on the top of search results; called out in a box in the sidebar; etc.). The second sale is when shoppers buy the displayed products because what they were searching for appeared in that key spot and got their impression, click, and conversion into a sale.
So, it’s a double sale and a triple win:
1. The buyer finds the product that is theoretically the best match
2. The seller with the best-matching product sells more and moves up in rankings
3. Amazon collects ad fees and a percentage of the sale, plus any other related fees
Needless to say, if you’re an Amazon shopper (and really, who isn’t now?) you’ve likely bought one of these promoted products — and you may not have even realized it.
Amazon does an incredibly good job making the products appear like organic search results while also calling them out as “Sponsored.” And if you’re an Amazon merchant, it’s likely that you’ve at least dabbled with Amazon Advertising in Seller Central or with the ad options in the AMS tools of Vendor Central.
Amazon Advertising is more than just running ads
For merchants, the question is not “are you using Amazon Advertising?” That ship has sailed. Now, it’s a question of “How good are you at using Amazon Advertising?”
Because if you’re merely average, you’re going to get beaten by competitors who find keyword opportunities, write better copy, bid smarter, manage their budgets better, and/or who outsource their Amazon Advertising to experts.
It’s not enough to merely run ads on Amazon; sellers have to work those ads well so that the ads work well for them. That means testing different ad versions and bids to see what performs best, and perhaps outsourcing the job to different PPC companies to see who gets you the best results.
Consider the following difficult conditions that apply to the current Amazon Advertising landscape:
• Most sellers and vendors are already participating in advertising
• Sponsored Products Ads are available to all sellers on both Seller Central and Vendor Central
• Bid values get more expensive as more sellers use these ads
So right now, how can you still win at Amazon Advertising when all of the above apply? The answer is by being like Amazon itself and not relying on the status quo.
How to approach Amazon Advertising for maximum success
In order to effectively compete in the Amazon Advertising arena, you can copy the tactics that Amazon uses and go against the grain when devising your strategy.
The following ideas will help you get started with an Amazon Advertising gameplan:
Find keyword opportunities that aren’t already played out in terms of usage and bid escalation
If everyone is bidding on the same keywords, no one wins, save for Amazon who collects the ever-increasing auction price. Look for keywords that aren’t necessarily in the top ten or high-priced keywords, but those that show up enough and convert well for you and your competitors.
Where can you find these? In the User Search Term Report (literally a list of words that shoppers are using to find products) and via reverse ASIN look-up where you’ll find keywords associated with any ASIN and how they rank. You’ll quickly train yourself to recognize opportunities others have missed.
Don’t be afraid to spend money to make money
If a keyword is a true winner, it’s probably worth those extra cents on the bid. Don’t lose it over pennies. And feel free to use Bid+ if you really want to be covered in the event a bidding war heats up.
Also remember that while you want to keep your advertising cost of sale (ACoS) manageable, the lowest ACoS isn’t always desirable. You’re looking for the sweet spot for ROI, so don’t cheap out.
Don’t just rely on Amazon Sponsored Products Ads
If you’re a vendor on Vendor Central, you have access to Amazon Marketing Services (AMS), which also includes Headline Search Ads (HSAs) and Product Display Ads.
Since HSAs are only available via Vendor Central and to brand-registered sellers on Seller Central, there’s less competition than with Sponsored Products Ads. And Headline Search Ads’ placement is great for both sales and branding. As Product Display Ads aren’t available within Seller Central (even to brand owners), there is even less competition there.
Mix it up and see what works. Just like with investing, diversification is key. Experiment and let the data dictate what kinds of ads are best for your products.
Run automatic Sponsored Products Ads campaigns as well as manual ones
Again, strength lies in diversity. With manual campaigns, you have more control over Ad Groups and negative keywords, but don’t dismiss auto campaigns as useless. Run them and let the Amazon algorithm work its magic. Sometimes, the automatic campaigns will outperform their manual counterparts.
Auto campaigns can also be a learning opportunity. I guarantee that you’ll find that they’ve pulled in keywords that you hadn’t considered before (not to mention competitors’ ASINs where you can view their product listings and find even more keywords).
Go beyond the tools available in Seller Central and Vendor Central
Both of these hubs are essential, but they’re jam-packed, serve hundreds of purposes, and offer no true competitive edge. If you’re serious about Amazon Advertising, try an application or platform that is strictly for Amazon Advertising.
We’re currently starting to roll out the new Ignite 2.0 at Seller Labs, including Ignite Plus for ad agencies and PPC consultants, as well as Ignite Managed Services for sellers who’d prefer to turn their Amazon Advertising over to our PPC experts.
The amazing thing about the new Ignite is that when it comes to the points discussed above, Ignite helps with all of them. It even provides data-driven keyword and bid suggestions. The best part is that it does it all from within one scalable, easy-to-use platform. That means that you get the advantages you need for effective Amazon Advertising and you save time by doing it all from one app.
You’ll also want to ensure you’re always offering your products at optimal prices, and a tool like Informed.co’s automated repricer is the perfect complement to pair with an Amazon Advertising tool like Ignite.
Winning at Amazon Advertising: the bottom line
The most important things to remember to succeed at Amazon Advertising is to stay curious and hungry. Always look for opportunities, however small, and leverage them to differentiate your ad campaigns from those of your competitors. The differences add up quickly, and those are what will help you win more of the top spots that lead to conversions, not to mention increased brand awareness and organic ranking, and more sales themselves.
Never stop learning about advertising and never stop testing and optimizing. Constantly read about Amazon PPC, attend webinars, and stay involved in your campaigns.
Amazon Advertising is like a living organism, so expect it to continually evolve over time. What worked yesterday may not work tomorrow, and you’ll need to stay informed on updates to the platform and make occasional campaign adjustments.
This is not a set-it-and-forget-it sort of thing, at least not if you want to drive revenue and build a brand. Treat Amazon Advertising like you treat your product listings and never ever stop optimizing and looking for opportunities to improve your campaigns.
About the Author
Lena R. Liberman is a Content Editor at Seller Labs, a leading-edge firm that develops and supports software applications that help Amazon merchants increase profits. Seller Labs provides solutions for seller reputation management, product reviews, keyword research, listing optimization, product research, Amazon Advertising, and business intelligence. Seller Labs is the leader in the Amazon third-party solution space. The company works with more than 15,000 sellers who earned a combined total of $7 billion in 2016. Sellers choose Seller Labs’ applications because of their ease of use, ability to drive sales, top-notch customer service, and industry knowledge.