Amazon offers several pay-per-click (PPC) advertising options that allow sellers to promote their products and brand within search results. This powerful advertising tactic is very popular among Amazon sellers for its ability to effectively grow awareness of your brand and increase sales. In fact, Amazon’s data reveals sellers experience a 40% average weekly increase in units ordered within the first year of launching a sponsored product campaign! With this in mind, let’s look at Amazon’s PPC options and explore how each one can help boost your brand’s visibility.
What is PPC Advertising?
Before we get started, it will be helpful to understand what exactly PPC advertising is. Pay-per-click advertising is a paid digital marketing tactic in which the advertiser pays the advertising platform a fee every time a customer clicks the ad (known as the cost per click, or CPC). Paid search advertising, which is the placement of sponsored ads within search results, is one of the most common types of PPC advertising.
What is Amazon PPC?
Amazon PPC gives Amazon sellers the ability to launch paid ad campaigns promoting their products and brands in search results, both on and off Amazon. Ads are displayed within product search results and on product listings and are chosen based on the customer’s search queries and shopping behaviors (for example, if they had previously viewed the product’s Amazon listing).
Amazon PPC is incredibly popular with Amazon sellers. A recent survey reveals 75% of sellers use at least one of Amazon’s three PPC ad options.
How Does Amazon PPC Compare to Google AdWords?
Amazon PPC is very similar to Google’s pay-per-click advertising program, AdWords. Like Amazon PPC, AdWords allows you to place paid ads within search results to attract more customers and to bid for common keywords. While both ad programs are beneficial for online retailers, Amazon does have a leg up when it comes to conversion rates – average conversion rates for Amazon PPC are twice that of Google AdWord’s. Much of this is because Amazon shoppers are actively trying to make a purchasing decision, while Google users might not be.
What Are Amazon’s PPC Ad Options?
Amazon offers three different types of PPC paid search ads:
1. Amazon Sponsored Product Ads
What it is
Sponsored Product ads allow sellers to promote specific product listings.
Your products will be seen by consumers when:
- relevant keywords are searched or,
- similar product pages are viewed
Sponsored product ads are seen on the search results page or in a carousel of ads on a related product page.
Amazon Sponsored Product ads are the most common of all three ad types. According to Jungle Scout, 66% of third-party sellers use Sponsored ads.
Sponsored product ad sample:
How it Works
Amazon makes it easy to launch a Sponsored Product ad campaign. You’ll need to choose the desired keyword or select from Amazon’s keyword suggestions. Then, you’ll bid for the maximum cost-per-click you are willing to pay for each keyword. Additionally, you’ll have to set a daily budget and duration. The actual ad design is generated by Amazon, based on your product page.
2. Amazon Sponsored Brand Ads
What It Is
Sponsored Brand ads allow you to showcase your brand and several of its products within relevant search results. Amazon offers two types of Sponsored Brand ads: headline search ads — image-based ads for promoting up to 3 products — or video ads for promoting one product. In addition to featuring a video or images, Sponsored Brand ads also include your brand’s logo and a headline of your choice. You’ll be able to link the ad to your brand’s home page, a product detail page, or a custom landing page.
Sponsored brand HSA ad sample:
Sponsored Brand Video ad sample:
How it Works
Like Amazon Sponsored Product ads, you’ll need to choose the desired keywords, bid amounts, campaign budget, and duration. You’ll also choose a headline, imagery, and the products you’d like to showcase.
3. Sponsored Display Ads
What It Is
Amazon Sponsored Display ads differ from the previous two ad types since they are displayed on Amazon AND third-party websites and apps associated with other online marketplaces. Another difference is Sponsored Display ads do not use keywords to target customers instead, they target customers based on their shopping behaviors (such as if they’ve previously viewed your product’s page).
Sponsored Display ads consist of a product image and info, with the option to add a custom logo and headline. They are placed on the Amazon home page, product detail pages, search results pages, Twitch, and third-party marketplaces.
Sponsored Display ad sample:
How it Works
To get started with Amazon Sponsored Display ads, you’ll need to choose your daily budget, the products you’d like to promote, and your bid amounts. Additionally, you’ll select your desired tactic: Product Targeting or Audience. Product Targeting displays your ad to customers who have viewed similar products, while Audience displays your ad to customers who already viewed your product listing or similar product listings.
What Are the Benefits of Amazon PPC?
As with other popular paid search options like Google Adwords, Amazon PPC is an effective advertising tactic proven to grow sales. Let’s take a look at some of the many benefits of advertising with Amazon:
- Improved Visibility and Rankings: As more and more people view and purchase your product listings, you’ll experience a boost in your product’s organic rankings in search results.
- More Reviews and Higher Conversions: As a result of increased sales, you’ll get more reviews. And, having more positive reviews increases conversion rates (the percent of customers who end up purchasing after viewing your listing).
- Higher Return on Investment (ROI): Amazon PPC has a conversion rate of 9.55%, which is 618% higher than the average conversion rate for other paid search platforms.
Who Can Use Amazon PPC Advertising?
Sponsored Product ads are available to all sellers and vendors whose products are not on the prohibited products list. Sponsored Display and Brand campaigns are only available to vendors or sellers enrolled in Amazon Brand Registry.
How Much Can I Expect to Spend on Amazon PCC Ads?
Amazon gives you a lot of flexibility when setting a budget. You set the maximum amount you’re willing to pay for each click and a daily budget. For Sponsored Brand ads, you can choose to set a campaign-level budget rather than a daily budget.
There’s no one right answer in terms of how much to spend on Amazon PPC. If you haven’t done any paid search advertising before, you probably want to start small and make changes as you view your results and get the hang of things. That being said, here are some numbers that might help guide you when deciding how much to spend:
- To start seeing results, Amazon suggests setting a daily budget of no less than $10.
- The average cost per click on Amazon is $0.89.
- Jungle Scout, an Amazon selling platform, recommends that the maximum CPC bid for products costing between $18-35 should not exceed 2.5% of the product’s total price.
Grow Your Sales With Amazon PPC
Ready to start reaping the benefits of paid search ads? We’re here to help. Looking for guidance with Amazon PPC advertising– contact us today. We’ll help you promote your Amazon products as effectively as possible to ensure you get maximum ROI.
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