Over the last five years, the way we shop has changed spontaneously. There are changes in consumer behaviors, new trends, and technological advancements as e-commerce develop. Seeing this as an opportunity, ambitious companies such as Google, Facebook, and Amazon are already leveraging digital advertising to drive traffic, increase sales as well as conversion.
In this guide, we will focus on Amazon ads in different types, and how they can increase revenues for online retailers.
Why Does Amazon Advertising Work?
Here's why! Amazon is the largest online marketplace in the world for different reasons. First, they boast around 300 million Amazon users and a whopping 80 million of those are Americans with Amazon Prime. Interesting! With so many people flocking Amazon to either buy or sell, Amazon uses technology to collect tons of data about how buyers shop. Through this, Amazon knows who needs what and feeds buyers will compelling ads that leave them no option but to place an order. You can't command such a valuable asset and not be the best in your industry.
Talking about advertiser's choices when it comes to eCommerce businesses, Amazon surpasses Google Shopping and Facebook Marketplace. Still wondering why using Amazon display ads is the top choice for retailers? Well, experts forecast that Amazon's net US digital ad revenues will increase by 41% this year. That is around plus 10% of US digital ad spending in 2020. As the global pandemic keeps influencing consumer's shopping habits and accelerating growth in Amazon's ad revenues, do you think this figure will reduce any time soon? Well, I think Amazon ads have come to stay.
Amazon Drives Higher Returns Than Facebook / Google
According to a new report from Feedvisor comprising over 1,000 U.S. brands, the number of brands advertising on Amazon increased from 57% last year to 73% this year. This increased uptake confirmed that Amazon drives higher returns than Facebook and Google. In this section, we consider why brands are considering Amazon's advertising platform to Google and Facebook.
1. Amazon drives greater ROI than Facebook and Google
A majority of brands selling on Amazon (59%) said that the platform generates their highest return on media spend, followed by Google (22%) and paid social (17%).
2. Most brands prefer Amazon because it drives at least a 7X return
If 1OO brands opt for Amazon advertising, at least 47% see a minimum of 7X return on their ROAS (Amazon advertising spend). The same figure could be estimated for retailers using different ad solutions.
3. Advertising on Amazon is now available at all stages of the shoppers' journey
Amazon's advertising platform is becoming more technologically advanced, allowing brands to target consumers at all stages of their journey. 58% of retailers use Amazon to build brand awareness, 60% advertise on Amazon to acquire new customers, while 62% of retailers use Amazon display ads to drive sales.
3 Different Types of Amazon Ads to Know
You'll find three different ad types for Amazon Advertising; they include:
1. Sponsored product ads
2. Sponsored brands
3. Product display ads
1. Sponsored Product Ads
Amazon sponsored ads products are a PPC (pay-per-click) advertising solution that promotes one product. Your business only pays when a shopper clicks on the advert, giving you maximum control over your ad budget. Brands use sponsored product ads to promote their products across product detail and search results pages. With this type of Amazon ad, your business can automatically or manually target keywords for your products to target shoppers.
Where do sponsored product ads appear?
Sponsored product ads on Amazon are displayed on mobile and desktop devices in the following locations:
· At the bottom of search results
· On the right of search results
Sponsored product ads can help any business to attract target shoppers. They also encourage shoppers to purchase your product in the later stages of the buying funnel.
Who can use sponsored product ads?
· Retail vendors
· Professional sellers
· Kindle Direct Publishing (KDP) Authors
2. Product Display Ads
Product display ads are another form of PPC advertising where a business promotes a product by targeting similar products or shopper interests. Product display ads are more effective in reaching target shoppers. Unlike sponsored product ads that focus on keywords, product display ads find the similarities between your shoppers' interest and your products and the categories. As a PPC advertising model, sponsored product ads are budget-friendly – your brand pays when a shopper clicks on the ad.
Where do product display ads appear?
· Customer review pages
· Related product detail pages
· Merchandising emails
Meanwhile, product display ads can also appear outside of Amazon, for example:
· Amazon websites, such as IMDb
· Amazon Demand-Side Platform (DSP)
· Amazon devices, like Amazon Fire TV
Your company can reach a wider audience with product display advertising.
Who can use product display ads?
Product Display Ads are uniquely available to the following Amazon vendors:
· Hardlines vendors
· KDP authors
· Book vendors
· Softlines vendors
· Media vendors
· Consumable vendors
· Supplier Express or Vendor Express vendors
3. Sponsored Brands
Sponsored brands are a PPC advertising solution that features automatic or manual bidding. They highlight your brand and up to three products. Keywords are a major component of sponsored brands but instead of bidding on keywords, as a PPC advertising solution, you are bidding solely on clicks.
Where do sponsored brands appear?
Sponsored brands are displayed on Amazon in the following locations on desktop devices:
· To the left of search results
· Above search results
· Below search results
For mobile users, Sponsored Brands also appear within search results in the Amazon app.
Who can use sponsored brands?
Only professional sellers and retail vendors are allowed to use sponsored brands for advertising new products on Amazon. Check out these additional requirements for each:
Professional seller requirements
· Have an active Amazon account
· You must be registered in the Amazon Brand Registry
· Ship to all USA addresses
Retail vendor requirements
· Books vendor
· Consumable vendor
· Hardlines vendor
· Softlines vendor
· Vendor Express vendor or Supplier Express
· KDP author
· Media vendor
What Amazon Ads Are Currently Used by Brands?
Different Amazon ads work for different brands depending on what you want to achieve.
Use sponsored brands if you want:
· To promote multiple new products at the same time
· To drive brand awareness
· To drive sales
· Your advertisement to appear above search results
· To create custom landing pages
Use product display ads if you want:
· To extend your business' reach
· To cross-sell and upsell your products to shoppers in your target audience
· To connect with customers that your competitors' ads miss.
Use sponsored product ads if you want:
· To reach shoppers as they search for products that they wish to buy
· To drive real traffic to your business
How to Set up Amazon Ads?
Setting up Amazon ads can be incredibly effective at helping you drive more sales. However, you must apply the right PPC strategy before setting up Amazon product ads. Consider the following steps:
1. Sign in to your Amazon Seller Central account, on your homepage hover over Advertising. From the dropdown menu, choose Amazon "Campaign Manager".
2. On the "Campaign Manager" page, click on the button to set up your campaign budget, as well as the duration. Fill out the accompanying information including daily budget, ad groups, keywords, etc. then move on to step three.
3. You will be required to "Name this group of ads". Note that you can add multiple ad groups to the same campaign, so you want to choose different names for different groups.
4. Up next, you will be asked to choose which product you would like to advertise. Note that you can only choose 1 product per campaign.
5. Now is the time for you to choose your budget. Take note of keyword bids and daily budget. For instance, if your daily budget is set for $15 and your keyword bid at $1, your ad will generate $15 clicks per day.
6. Next in line is choosing your keywords. You want to make keyword research before doing this. There are numerous free tools online to help you out. Also, Amazon offers suggestions which you can choose from.
7. After choosing the keyword, click on "Save and Finish" at the bottom of the screen.
8. Upon completion, you will be redirected back to your Campaign Manager page. Here, you should see a "Success!" message.
NOTE: You'll need to wait at least one hour before the new ad campaign starts to appear in searches.
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Call to Action
Congratulations! Now you know all about Amazon sponsored ads, Amazon display ads, Amazon video ads, Amazon banner ads, and Amazon product ads. It is high time you started making the most of your Amazon ads. Take your time to create an Amazon advertising campaign to increase your chances of getting higher returns and greater exposure for your business.
