Amazon is the largest marketplace for e-commerce and an excellent platform for advertising.
According to the eMarketer, Amazon has become the third-largest advertising platform. This means sellers use Amazon as a selling platform and as an advertising platform.
Now, as an advertiser, Amazon has begun to attract sellers’ attention. According to the 2021 Amazon advertising report, 75% of sellers use at least one type of Amazon PPC.
So, if you are selling on Amazon, it’s not possible you haven’t heard about the Amazon advertising campaign. But the remaining 25% of people may ask,
So, before we discuss the types of PPC advertising available on Amazon, let’s talk about Amazon PPC definition first.
What is Amazon PPC?
Amazon PPC’s meaning is “Pay Per Click.” It’s an advertising platform on Amazon that allows third-party sellers to create ad campaigns for their products.
How does Amazon PPC work?
In Amazon PPC pay-per-click advertising, the seller will only pay when any potential customer clicks on the ad. You don’t have to pay for impressions.
Amazon PPC is simple. It works like an auction. Like in an auction, every potential buyer bids on the item, and the one with the highest bid own’s the item or product.
Similarly, each advertiser bids on a keyword for an ad spot in Amazon advertising. The one with the highest bid will win the spot for advertising their product.
Let’s discuss one Amazon advertising example,
Suppose you bid highest on a specific keyword of $2.00, and the second advertiser bids $1.50 on the same keyword. Being the highest bidder, you will win the spot, but you don’t have to pay $2.00. You will only pay $0.01 more than the second bidder, which is $1.50. Adding $0.01 to the $1.50, you will end up paying $1.51.
Why Amazon PPC is important or why should sellers use Amazon PPC?
Amazon has become such a powerful marketing channel that helps sellers advertise their products and sell directly to active customers. This means that sellers don’t have to find buyers; instead, the potential buyers will find the sellers.
Now moving to our question,
Why is Amazon PPC important, or why should sellers use Amazon PPC?
According to the stats, more than 350 million products are listed, which means your product’s chances of getting lost are higher. But with the help of Amazon PPC advertising, you can help your product to get visible on the top search result.
Especially after the pandemic when many retail stores are closed now that most people are moving towards online retail stores to fulfill their needs.
According to Amazon records, about 2.45 billion people visit Amazon.com every month. So, many visits mean so many potential customers, and the best way to target them is by Amazon PPC campaigns.
Amazon Advertising Types
There are three types of Amazon advertising,
- Sponsored product ads
- Sponsored Brand ads
- Sponsored Display ads
Let’s discuss each type of Amazon advertising ad.
Sponsored Product Ads
Amazon Sponsored product ad is the most popular type of advertising on Amazon. It helps sellers advertise an individual product on the Amazon search result page by using keywords.
Here is an example:
The sponsored product ads will display the organic result with the label sponsored on it. This is the most common PPC type used by 66% of sellers.
Amazon sponsored products PPC works great only if you have done solid competitive keyword research. It’s very beneficial to improve your click-through rate or sales conversion rate.
The research shows that you will see a weekly +40% increase in your unit ordered rate within the first year after launching a sponsored product campaign.
To set up a sponsored product ad or campaign, you need to choose a keyword and budget, but there are two types of campaign targeting strategies you can use
- Automatic targeting
- Manual targeting
Now, what’s the difference between an automatic targeting campaign and a manual targeting campaign? Let’s explore.
The Amazon algorithm uses the keywords that it collects from shoppers based on clicks and purchases in automatic targeting. Amazon will automatically match your product with those related keywords and show your ad when it matches
In automatic targeting, sellers can utilize four keyword match types:
- Close match
- Loose match
In manual targeting, you manually select the keywords you want to bid on. If you’re using a manual targeting strategy, your ad will only show when it matches with the one you chosen keywords.
Manual campaign further facilities a seller to use two types of targeting, one at a time.
- Keyword targeting
- Product targeting
Let’s take a quick overview of both types.
In keyword targeting, you can use three types of keywords that help your product to display on the search page that is
You can target any competitor product to feature your ad below his listing in product targeting.
Sponsored Brand Ads
With the help of Amazon Sponsored brand ads, you can promote up to three products. Today 34% of third-party sellers use Amazon Sponsored brand ads.
The sponsored brand ad gives you two options either you want to promote your product at the top of the Amazon search result page as a headline banner.
or down the page as a video.
Sponsored Brand ads are also called banner ads because they appear on the top headline, brand awareness.
Amazon’s sponsored brand campaign helps you in brand building as it appears with its logo. The main objective of Sponsored Brand ads is to increase the possibility of your product being seen.
Sponsored Display ads
Amazon sponsored display ads are the newest type of Amazon PPC that is not popular yet. Only 25% of third-party sellers can use this PPC type.
Sponsored Display ads can appear in different places like below the “Add to cart” button on Amazon, below the product detail page in similar items, or other Amazon’s affiliate sites like Facebook, Netflix, Google, and other mobile apps.
On-Amazon Sponsored Ads:
Off-Amazon Sponsored Ads
Amazon PPC is an excellent opportunity to increase revenue, profit, and brand awareness. Amazon offers three different ways to target customers Sponsored Products, Sponsored Brands, and Sponsored display ads.
Using traditional advertising ways where you have to pay to advertise your product, Amazon gives an opportunity of CPC ads where you only pay when a customer clicks on your ad.
It’s an efficient approach, but it depends on your advertising type to promote your products.
If you are confused about which advertising strategy will suit your business need, get in touch with Bizistech, verified Amazon advertising partners.
If you have any questions or suggestions, feel free to share. Thank you.