Google and Facebook are still the two dominant digital advertising platforms, but Amazon is coming on fast, which prompts many clients to ask me how to advertise on Amazon. And I’ve got some answers.
According to eMarketer, Amazon is now the third-largest advertising platform behind Google and Facebook. And Amazon’s ad business is booming, achieving 95 percent year-over-year growth according to Amazon’s fourth-quarter earnings announcement made on January 31.
This growth is not surprising. Amazon dominates Google for product searches, making Amazon an influential and sizable search platform. And those searches convert to revenue: $4 out of every $10 spent online in the United States is on Amazon. Just as Google learned to monetize that search traffic, so is Amazon by rolling out products that give businesses on Amazon more prominence through advertising. What this means is that any business on Amazon needs to add Amazon to its repertoire of advertising platforms. You can’t cover all your bases by being on Bing, Facebook, and Google anymore.
In fact, we’ve been working with a number of businesses to build their presence on Amazon by capitalizing on its ad products. Here are three examples:
Sponsored Products promote products to shoppers actively searching with related keywords or viewing similar products on Amazon. They appear with or alongside a search result as inventory. They blend well with organic results as in this example:
When you click on a Sponsored Product listing, you’re taken directly to the product detail page. It’s important to remember that “core” products (typically items that customers buy frequently and have high ratings on Amazon) have a better likelihood being shown due to customer reviews and organic data. Sponsored Products deliver high-converting campaigns with low cost per click compared to equivalent ads on Google and Bing.
Sponsored Brands (Formerly Headline Search Ads)
Sponsored brands showcase a collection of products to shoppers searching with related keywords on Amazon. Sponsored brands appear on the top of the page akin to banner ads, as in this example:
Sponsored Brands provide high-visibility placement above search results. With Sponsored Brands, you publish your own your logo, a custom headline, and three products to drive traffic. If someone clicks on one of the products you showcase, they can go to your website store or to your own Amazon Store (the equivalent of your own Amazon websites).
Sponsored brands are especially useful when you’ve added a new product to Amazon. That’s because when you advertise new products to Amazon, it can be difficult to boost visibility with no data behind new products. This type of ad provides great visibility.
Product Display Ads
These deliver relevant ads to shoppers who are actively viewing specific products by targeting shoppers’ interests or related products and categories, as this example shows:
As you can see from the above example, these display ads can appear on a competitors’ product inventory, which helps you conquest your competitors. Targeting similar products is something Amazon encourages you to do. By contrast, Google does not, and you will be penalized if you do (reflected in your quality score). You can conquest not only a competing brand but even a specific ASIN (Amazon’s term for an SKU). In addition, Product Display Ads are great for cross-selling and as a defensive tactic. For instance, you might run a display ad for a complementary product, such as an ad for running shoes alongside your inventory of running shorts. Furthermore, by buying up the ad space on your product detail pages, you can protect your products from competitors. You won’t pay for the ad unless someone clicks on it.
Amazon offers a number of other products under Amazon Advertising, and some of them apply even if you don’t have inventory on Amazon. For the sake of brevity, I won’t get into them all here. The Amazon Advertising website contains more detail.
At Investis Digital, we work with businesses from many industries to help them build brand and move product through Amazon Advertising. Here are some tips for succeeding:
- If you have products on Amazon, make sure you ad Amazon to your toolkit along with the ad platforms you’re using already. But be consistent in your branding across platforms. Remember that shoppers are encountering your brand across the digital world. Don’t confuse them with mixed messages or contradictory offers.
- Be strategic in your use of products. As I noted, Sponsored Brands might be a better fit when you’re introducing a new product, and Product Display Ads are great for conquesting and cross-selling.
- Make sure your site is ready for an uptick in orders. If your ad takes you to your own site, is the transition seamless? Do you have enough inventory to accommodate a spike in demand?
But the most important tip: get moving on Amazon Advertising. It’s very important to get involved now so that you can reap benefits as Amazon evolves its product offering. Now is the time to benefit from lower costs per click rates before more advertisers get involved.
Where Amazon Is Headed
Amazon is eager to catch up to Bing and Google, and the company is making improvements to its products rapidly. One big area for improvement is providing detailed reporting metrics to advertisers. Improvements here will lead to more efficient campaign optimization and better performance. I expect Amazon will catch up, though, by providing more insight into purchasing behavior. After all, Amazon is a powerful ecommerce platform that accumulates vast amounts of data about its users. In particular, I see Amazon providing device-specific data in 2019 -- which it currently does not do, putting Amazon behind Bing and Google. Amazon Advertising is on a roll. It’s not quite an unstoppable juggernaut, but give Amazon some time.