You've probably heard of Amazon pay-per-click (PPC) advertising if you sell on Amazon. If you're planning to sell on Amazon and have done your research, there's no way you haven't heard about it. Everyone is talking about Amazon PPC and how it may help your FBA business.
With millions of products listed on Amazon, getting your product to stand out from the unending sea of products might seem difficult, especially for beginner Amazon sellers.
With a solid Amazon PPC campaign in place, you'll likely be able to generate concrete results, provided you've done your product research and followed the correct product research criteria.
Even the best Amazon advertising strategy, however, would be a complete waste of money if you started with the incorrect products. You should only consider advertising on Amazon when you've perfected the approach of offering a compelling product on Amazon.
To get the most sales out of your Amazon PPC campaign, always run advertisements on listings with a decent conversion rate. Conversion rates on Amazon are a complicated issue since they are determined by various factors, including the quality of your products.
Optimizing your listing is important not only for your organic conversion rate in terms of sales but also for Amazon PPC, as a keyword match between the PPC ad and text in your listing, such as in your product detail section, product title, and so on, will help you rank higher in search results significantly.
There have been several significant upgrades to Amazon's PPC advertising, including more keyword matching options, better location-based search results, machine-learning algorithms that monitor how long it takes users to discover a product, and more.
Advertisers compete in an auction-like setting for the right to bid on keywords. Product search results on Amazon are based on the highest-bidding sellers on relevant keywords, and their product adverts appear in the position they've selected.
What is Amazon PPC, and how does it work? – Amazon PPC. This is a common concern among first-time sellers. Starting off, it's necessary to learn the basics of Amazon advertising.
What is Amazon PPC (Pay Per Click)?
Amazon Pay-Per-Click, often known as sponsored ads, is a well-known advertising network that allows sellers to increase their online product sales. The advertiser only has to pay Amazon when you click on the ad in the pay-per-click (PPC) model. You don't have to pay for impressions if you're already running Amazon PPC advertising. With Pay Per Click/PPC, only the advertiser pays when the user clicks on the ad, as opposed to when the user visits the ad and views it.
Sellers use Amazon Advertising to increase brand exposure, sales, and Amazon Store visits, among other things.
Using Amazon PPC, advertisers compete for ad space on search engine results pages by bidding on targeted keywords. The amount they bid and the quality of their advertising impact their visibility and ad ranking. Amazon's advertising space is coveted among advertisers.
Vendors and sellers may "purchase" visibility at the top of Amazon's search results by running Amazon advertisements. In a unique sort of real-time auction, they pay a pre-determined price. For a search term, the ad that displays first in search engine results will be the one that provides the best price.
Advantages of Amazon PPC Ads
The ACOS objectives you define for your campaigns will impact the profitability of your advertisements. You may have to bid up to a break-even point or even higher in some markets due to the intense competition, which means that you are either not generating any money from your ad sales or you are really losing money.
When the primary goal of a business is to make money, why would anyone promote to only break even or lose money on their ads? The major reason for advertising on Amazon is because there are several additional benefits.
Positive impact on Organic Rankings
It is possible to improve your organic ranks as well as your advertising revenue by using Amazon Sponsored Products. Amazon uses a variety of factors, including sales velocity and sales history, to rank products. Your organic rating for a certain search keyword should rise significantly of buyers purchasing your product via an ad after searching for that term. When you use Amazon PPC to boost your sales, you'll also improve your organic ranking.
Amplified Product Visibility
A new product's visibility will be greatly enhanced by Amazon PPC, as organic rankings take a long time to achieve. When it came to boosting sales and gaining favorable feedback, sellers used to give out freebies. As a result, Amazon advertising has become even more important in promoting your new products' launch. The more reviews you get, the better your organic rankings will be.
Enhances Amazon Search Engine Optimization
You get a complete list of keywords that buyers use to find your products when you use Amazon Pay Per Click. This information may be used in your listing title, bullets, description, and backend keywords for SEO reasons.
On Amazon, PPC sales influence your organic position. The more sales you create through PPC ads, the higher your organic rankings for those products. This is especially important for new things with no past sales history. While some experts recommend starting an Amazon PPC campaign when you introduce a new product on Amazon, others advise waiting until you have at least three to five reviews.
Progressive Conversion Rate
We all know that better sales lead to more reviews, which leads to a greater conversion rate for listings (higher conversion rates also help you rank higher organically).
Increase Product Visibility For Seasonal Trends
Seasonal trends, such as Christmas, Mother's Day, Halloween, and so on, are when Amazon sellers see the most and highest sales. The same can be said for fourth-quarter end-of-season sales. Depending on the product, Amazon Ads can be a great way to boost sales by piquing client interest during the off-season.
To keep competitors from stealing top positions and sales
Vendor saturation occurs over time in popular product categories and niches. Competitors may overtake your product even if it ranks highly in organic searches and has compelling discounts. Most top-ranking businesses use PPC campaigns to preserve and retain their top ranks and positions in Amazon searches against competitors who also use PPC.
What are the different types of Amazon PPC Ads?
Brand-sponsored ads, display-sponsored ads, and product-sponsored ads are the three categories of Amazon ads. Let's find out more about them.
Amazon Sponsored Brands
Sponsored Brands are pay-per-click (PPC) advertisements that include your logo, a bespoke headline, and various products. On the search results page, these adverts are the first thing a potential consumer sees. These advertisements appear in Amazon search results and include your brand logo, a custom headline, and several products at the top of the page. They are keyword-focused, include a written headline, and may include up to three clickable products (or ASINs) at a time. In other words, The Sponsored Brand is a PPC ad meant to boost your brand's visibility among buyers looking for similar products.
Amazon Sponsored Products are pay-per-click adverts that allow you to drive traffic to your Amazon product listings. With Amazon Sponsored Products, you can achieve various objectives while also tracking your progress. Sponsored Product Ads relating to the item you're shopping for can be seen at the bottom of the product page. Sponsored Product Ads are so subtle, and an important element of the customer's buying experience that they have genuine potential to improve the customer's purchasing experience.
Sponsored Display Ads
With Sponsored Display Ads, you may run your own ad campaigns on and off Amazon, with the help of an automated ad creative. You can only show your products as a Featured Offer when they are in stock. They'll appear on Amazon's home page, search results pages, product detail pages, and other third-party websites and apps. Customers are sent to product detail pages as a result of their efforts.
Ads for Sponsored Display are accessible to professional sellers in the Amazon Brand Registry as well as merchants and agencies who work with clients that sell on the site. Display advertisements on Amazon's Fire TV allow marketers to target users while they browse and discover new shows. Sponsored tiles appear in the "Sponsored" row on Fire TV. In contrast to non-clickable advertisements, clickable ads may be used to promote app downloads, content streaming, and other goals. At this time, commercials for Amazon Fire TV are being seen in a number of countries.
Learn more about Amazon sponsored display ads.
Addinaly learns more about amazon ad types here.
What is ACoS?
ACoS is a metric for determining the effectiveness of your Amazon PPC campaign. The ratio of ad expenditure to ad income is known as the ad spend-to-ad-revenue ratio. It simply works out how much money you spend for every dollar you make.
ACoS = (ad spend * 100) / advertising revenue
When your ACoS exceeds 100, it means you're spending more money than you're coming in.
There is no one-size-fits-all formula for evaluating a campaign. The best ACoS is decided by several factors, including the product category, business strategy, and advertising goals, among others. These factors will need you to adjust your ACoS goals and devise strategies to achieve your objective.
Additional info about amazon advertising acos.
How do I run an Amazon PPC campaign?
Step 1: Calculate ACOS
First and foremost, we must determine our net profit margins from our listing to determine how much advertising we can afford, as well as our goal ACOS (average cost of sale).
Your net margin is computed by dividing your revenue by net profit per unit. This should be expressed as a percentage, but bear in mind the monetary value.
If you're a seasoned Amazon seller and have done your product research, you should already know your profit margins, but if you need to recalculate your net profit, use the FBA calculator here.
Enter your product cost, delivery cost, and selling price, and the calculator will determine your net profit by factoring in FBA costs and Amazon referral payments.
After completing this calculation, you'll have a target ACOS and advertising budget based on your net earnings to use as a benchmark. This will serve as a guideline for how much money you may spend on Amazon-sponsored advertisements for your goods.
Remember that the lower the ACOS, the better for any product you wish to offer on Amazon.
Step 2: Create your first campaign
Now is the time to build your first Amazon-sponsored product ad, which will be in the form of an Automatic campaign.
The goal is for Amazon to experiment around with our product ad and test out different keywords. You’re unlikely to earn from this product ad, so think of it as a charge for access to Amazon data for successful keywords. After all, most Amazon sellers lose money on their first campaign, so don't be discouraged if you don't notice a lot of sales from this one.
Go to the 'Advertising' page in your Amazon Seller Central account, then to 'Campaign Manager,'
then to 'Sponsored Products.'
Give your campaign a name that includes the name of your product, the date, and the sort of campaign you're running. Because you'll need to return to Amazon Seller Central later to export reports, make this as detailed and clear to read as possible.
This is important because if you run additional PPC ads in the future, things may quickly get out of hand, especially if your Amazon product has multiple versions.
Step 3: Let your automatic campaign run and export the results
Allow at least five days for your automated campaign to run once you've started it before moving on to the next phase.
If you're impatient and make changes after only a day or two, you risk making judgments based on data that aren't statistically significant. This might be disastrous for your products, especially because Amazon does not like random product modifications.
After 5-7 days, we'll collect data from this campaign to create our first manual campaign. To get your report, go to Amazon Seller Central's 'Reports' page and choose 'Advertising reports.'
In the Report Type section, choose 'Search Term' for the campaign you just conducted. Adjust the Report Period selection to correspond to the period during which your Amazon ad was active.
Click 'Create Report,' then 'Download Report' after it's finished.
Step 4: Identify good and bad keywords from your report
With your analysis, you'll be able to find strong keywords to focus on and eliminate keywords that are squandering our advertising money.
Use Google Sheets or Excel to open the report. The spreadsheet will contain a lot of information, but the following are the most important: keyword, impressions, spend, total sales, cost per click (CPC), and total advertising cost of sales (ACOS).
If the ACOS column is empty, it signifies that that keyword has yet to create any Amazon sales.
Sort the sheet by Spend, starting at the top with the most money spent. Note the top 5 keywords (in terms of budget) that didn't create any sales and include them in your negative keyword list in your next campaign.
Step 5: Create a Broad manual campaign based on your findings
Create a manual campaign with the profitable keywords you found in the report. You may run numerous manual campaigns for all of your successful keywords simultaneously or one at a time if you wish.
This also depends on the number of products you have on Amazon; we recommend doing this for one product at a time because doing so for numerous products at once would be difficult.
Add the required negative keywords to each of your Amazon manual campaigns.
Make sure you choose 'Negative Exact' rather than 'Negative Phrase' when you do this.
The Negative Phrase option may include more profitable keywords, which you don't want your product to lose out on if you want to rank for as many search results as possible.
Choose 'Manual targeting' instead of 'Automatic targeting,' choose your product, and then under the Targeting area, select 'Keyword Targeting.'
Put in the suggested bid for the time being, or more if your budget permits. This will also be influenced by how many product advertisements you're running simultaneously, so plan appropriately. To prevent spreading your attention too thin, we don't advocate doing this for too many products at once.
Don't use the Bid+ option, either. That option would be fantastic after we've figured out which terms are the most lucrative, but we're currently exploring for now.
Under Match type, choose 'Broad' and paste your top keywords here.
After that, click Launch Campaign and wait for the sales to come in. Before going to the next stage, let it run for at least five days.
Step 6: Narrow down your search terms into a Phrase Match campaign
You should have a good idea of how to create a campaign and how we narrow down keywords based on sales by now. We filtered down keywords from our Automatic advertising to a Broad Match in previous campaigns, and we'll do the same from a Broad Match to a Phrase Match in this step.
Repeat steps 4 and 5 to narrow down the top 20 most lucrative keywords for your Phrase match campaign and add the top 5 most unprofitable keywords to your negative keyword list.
Allow at least five days for every campaign you run so that your products have enough time to make sales before checking back.
Step 7: Craft your Exact Match campaign
You should have a good selection of keywords for your final Amazon PPC campaign once you've filtered down your most lucrative advertisements from the previous phase.
Repeat steps 4-5 to determine the specific phrases that will be used in this campaign. Then, after 5-7 days, run your ad campaign and export your results.
You should be ready for Amazon PPC with this last report since you've discovered the ideal search phrases to employ on your items. You'll use the top five search phrases from these advertisements to run Amazon PPC advertising indefinitely, as long as your ad expenditure is profitable based on your product and delivery costs.
How to optimize PPC on Amazon?
Aiming for an ACOS (average cost of sale) lower than your profit margin is the objective of Amazon PPC. In general, the lower the ACOS number, the better.
We intend to make at least $1 in net profit for every dollar we spend on sponsored product advertising.
You could be thinking, "What if my Amazon PPC spend is only breaking even?" Is it still worthwhile to run?
A loud yes would be the answer. Even if you break even on Amazon PPC, you're still driving more sales to your listing than you would without it, and the corresponding Amazon SEO criteria, such as sales velocity, reviews, and ratings, are all benefiting greatly from these sales.
Even if you don't make a profit from sponsored product advertisements, the additional sales they generate can help your listing rank higher on other related variables, resulting in more organic sales in the long term.
This is why PPC on Amazon differs from paid advertising on other platforms such as Facebook or Google, where you are essentially left with nothing if you turn off your advertising budget.
You'll keep your improved BSR (a measure that indicates how highly you rank in search results) and, more significantly, the reviews from those purchases on Amazon. This implies that, unlike Facebook or Google advertisements, you may continue to reap the benefits of your Amazon PPC ad expenditure for organic ranking indefinitely.
You'll want to keep it on indefinitely as long as your Amazon PPC budget is breaking even. That way, you'll increase your BSR, speed up your review count, and collect more ratings, which will be extremely beneficial to your Amazon FBA career in the long term.
What Is Amazon Paid Search and How Does It Work?
Amazon receives millions of searches each month. Consumers will enter terms (keywords) in the search column, ranging from a single word to a complex sentence (long-tail keywords). The majority of people who use Amazon do so to make a purchase, not to look around. If consumers know what they want, they often type in a specific brand or product name in the search box, such as "Dell laptop." If they're undecided, they'll probably type "laptop" or even "computer" in the search box.
It doesn't matter what terms are used in the Amazon Search Engine; Amazon always returns a list of things. The findings may be "organic," which means they won't influence sponsored advertising. A key distinction to make is between Organic and Sponsored product listings, the latter of which show up above the organic listings on Amazon's SERP because their sellers paid to boost their products' visibility. Organic product listings appear on the SERP because Amazon's A9 Algorithm determined that they were the most relevant to the customer's search query.
Paid vs. Organic Search. Which one is preferable?
Both listings should operate together to boost your total traffic and conversions, so focus on how they complement each other. The combination of organic and sponsored traffic is essential for a successful business. Sponsored traffic boosts organic traffic, while organic traffic boosts paid traffic. The Cost of Organic Traffic That Isn't Visible.
The "free" clicks that organic traffic gets aren't free. Sponsored Product Ads are weaved within the organic results underneath the Headline Search Ads. Organic first-page rankings need a significant investment of time and money to optimize your product listing.
In conclusion, while Amazon PPC may initially appear to be a difficult advertising choice to master, it becomes second nature with experience. As a result of Amazon's PPC program, you can easily target customers wherever they shop, read, listen to, watch, or play through advertising experiences both on and off Amazon.
Data from Sponsored Product advertising, Sponsored Brand advertising, and Sponsored Display advertising can all be used to determine how well an ad is doing. A solid optimization strategy will emerge as a result.
We hope this article will be helpful in tracking and optimizing your campaigns in real-time. It's advisable to create many versions of each ad and then compare them to see which ones perform the best. Doing things this manner will always yield greater results.