The world was wowed and Google and Facebook took pause when Amazon announced early in 2018 that you could scale your advertising outside marketplace doors. Amazon’s extended ad network is still working its way up to meet the competition, but is already gaining a share of the PPC pie. Now is the time to scale your Amazon advertising to take advantage of the growth stage.
Amazon itself has always been big on growth, and they grab opportunities wherever they see them. This means that as a seller, you should be riding that wave with them. They have the advantage of big data, and this means that they will always steer in the direction of customers and profits. In short, because Amazon is pushing hard for advertising, it’s a sure sign that you need to scale your Amazon advertising.
Most sellers focus their advertising strategies on the Amazon customer. There are a lot of them, and more every day, so it’s a good start. But running sponsored ads on the platform is not all there is anymore, and frankly, it’s not enough anymore. The competition on Amazon and the speed at which they are progressing means that sellers who want to get to the top and stay there need an improved strategy.
Are You Ready?
It’s the best time to scale your Amazon advertising, but are you ready to take that on?
It’s going to mean a greater investment in terms of money, time and expertise– and it’s not worth starting if you’re not prepared to see it through. You’ll be increasing bids and ad spends, advertising more products, adding new keywords and ad groups, and using more than just sponsored products campaigns. It will also entail a lot of research, analysis and testing, and possibly hiring a PPC expert to guide your efforts.
Before you begin, know what your advertising goals are now, and where you want your business to be in a couple of years.
- What do you expect scaling your Amazon advertising can do for your business? (more sales, top organic ranking, brand awareness…)
- What is your ACoS, RoAS, daily spend and profit margin for products you advertise? What levels can you tolerate?
- What is the ratio of your organic versus paid traffic? What does this mean to you?
- How much time is currently invested in advertising, and how much more time – yours or a hire’s – are you willing to spend?
- Are you experienced enough with Amazon Advertising to spearhead expansion? If not, are you willing to hire someone who is?
- How updated are your current campaigns? Are there products you should be adding or campaigns you should be pausing, reevaluating, or closing out?
- Are your current campaigns performing well? What areas need attention? Do you need a professional to review your ad account?
After answering these questions, you should know if you are ready to scale your Amazon advertising.
If you are indeed ready, here are the steps:
1. Research the Competition and Keywords for Your Products
To properly scale your Amazon advertising, you must begin with your competitors. Know which ones hold the biggest chunk of market share. These are the brands and stores you need to model.
Your keyword research should begin with an analysis of the keywords they are using, because their success on the platform means that their search terms are working for the Amazon audience. Therefore, these keywords will get you the most sales and have the match types that will bring you the highest possible search visibility.
And you should do this regularly – there are new search terms coming out every day, so you need to stay on top of the trends or you will quickly fall behind.
Here are the types of keywords you need to master and what they mean:
The most basic words and short phrases that readily identify your product are your head terms. They are the words that you know customers search for on a regular basis. Obviously, these hot keywords have a higher cost per click.
Long-tail search terms are longer phrase variations of your head terms. They include other words that expand on the head term to make them more specific. Because they are more specific, they target a narrower audience and do not come at as high a cost as head terms.
2. Know How to Structure Your Ad Campaigns
Here are the types of keyword matching you encounter with Amazon Advertising:
This allows the Amazon algorithm to match your product with broadly-matching terms that customers are searching. This is great for further keyword research, but also means that your product can show up on irrelevant searches. But because you are targeting a larger audience with these terms, the cost is lower.
Using a head term with phrase matching, your product can show up on searches that contain your head term. This means a customer using a long tail keyword can hit on your product.
This strategy is best for exact phrases that you are sure bring in converting hits. Your product will only come up for searches that use the exact same words and phrases that you’ve included in your campaign. The click-through rate for these terms is higher than other match types.
Pro Tip: When you’re doing your research, remember that unlike Google, Amazon defines a high quality ad – and therefore high quality search terms – as those that are most likely to bring in sales.
When this step is done, don’t forget to optimize your product listings so that they match your campaigns, making them work together for higher organic rankings and lower costs per click on your ads.
As you run your campaigns, look into calculating category market share so that you can tweak your campaign goals. You will also want to explore products that are frequently bought together so that you can increase your market share, come up with enticing product giveaways to bring that number even higher, and maintain a consistent sales velocity.
Look into search demand as well so that you can properly plan your advertising budget.
3. Know Which Ads Amazon Prefers
As mentioned above, Amazon cares about bringing in more sales because this is what makes them more money. This is actually the end goal behind their customer-centric policy. They therefore prioritize ads that convert because these are the ads that customers obviously find useful.
To scale your Amazon advertising, you therefore need to determine which are your best quality ads as determined by the Amazon algorithm. You do that by analyzing the following metrics:
Your click-through rate over time shows how customers respond to your ads. This is a good metric on which to base the quality of your keywords and your ad performance. Your average conversion rate is a good indicator of this as well, but can also tell you if you have a great product and a trustworthy brand. Your overall sales on top of these metrics will give the bigger picture view of your value to Amazon, and therefore the value of your advertising efforts.
Optimizing your listings isn’t just for getting better visibility, although this helps your ad campaigns. The relevance of your product title, description, search terms, and even your seller name factor into how Amazon rates the quality of your ads and how they want to display them.
Pro Tip: You should also know about the different types of Amazon ads and how to use them to get better keywords and build better campaigns. Don’t forget about Headline search or banner ads, Sponsored Brands campaigns, and Product Display ads. Make use of Amazon Attribution as well to track the behavior of customers as they make their way to your listings through to purchase. This will tell you a lot about how well your campaigns are working and what you can improve on.
The biggest takeaway from all of this is probably the simplest, yet many Amazon sellers miss it. There is no set and forget with Amazon advertising.
To successfully scale your Amazon advertising, you have to realize and accept that it’s a marathon. You can’t sprint your way to the top if you’re not willing to go through the tedious cycle of research, analysis, testing, tweaking and monitoring. Moreover, Amazon Advertising is in its early years – there are going to be a lot of changes, and you need to stay on top of these changes if you want to keep riding the wave.