You just launch your dream product on Amazon, but it’s buried under competitor’s pages. No clicks, no views. Sounds frustrating? Don’t worry, you are not alone. Getting recognized on Amazon is more than just luck; it is a plan. So, explore the hidden plan, what is amazon PPC and how to use it.Let us break it down and get you started!
When you launch your brand or product on the versatile Amazon market, you may have some question in mind:
1-What is Amazon PPC?
2-Why use Amazon PPC?
3-What are Amazon PPC Ads(Types)
4-How to create an Amazon PPC campaign?
5-Amazon Advertising Key Terms and Features
What is Amazon PPC?
Amazon PPC is a type of “Pay Per Click” advertising. It is the advertising model that allows the sellers to increase their product visibility and brand awareness in the crowded Amazon marketplace. Sellers create PPC ad campaigns and in return Amazon charges a small fee when a customer clicks on the ad.
Without the powerful strategy of creating ads, it’s impossible to promote your brand visibility, store visits, and also to reach the potential targeted customers. Hence, Pay- per-click advertising is crucial to gain a Competitive edge as well as enhanced return on investment (ROI).
Why Use Amazon PPC?
Amazon Pay-Per-Click is a game changer strategy for the marketers to grow their business while keeping them competitive in the crowded Amazon marketplace. Scroll more to know the importance of Amazon PPC Advertising:
Increased Visibility
When a seller launches its product, it’s really hard to be on the top of search results. Amazon Pay per click strategy, allows the marketers to bid on relevant keywords, that increases the product visibility and captures the attention of potential customers.
When the potential customer comes with paid ads, it’s a positive sign for Amazon Algorithmic.Thinking, How? It shows that your product is more relevant for purchase .Greater product visibility leads to higher click through rate (CTRs), and ultimately converts to organic ranking and improved conversions rate
Targeted Advertising
When you bid on specific keywords, Amazon PPC gives complete control on that keywords to reach the possible customer. The targeted advertising confirms that the ads are shown to the audience intended to make a purchase. Thus, the targeted ads increase the chances of more conversions.
Other than just keywords, Amazon PPC gives the choices for targeting such as audience targeting and product targeting. By using product targeting, you can reach an audience that is interested in a similar type of product while the audience targeting is a more personalized approach based on the customer’s shopping behaviour and interest.
Maximize Sales
In the saturated Amazon market, it’s challenging to attain desired sales goals. Amazon PPC marketing can easily turn every seller’s dreams of getting maximum sales by reaching the exact audience. Highest visibility acts as an indicator to maximize sales.
Amazon’s Algorithm checks the sales velocity, by keeping an eye on search term ranking. PPC Ads campaign’s assistance to enhance sales and also the organic product ranking Also ,the continuous optimization and monitoring of Amazon PPC campaigns can contribute to bump up sales and revenue.
Cost Effective
Regardless of traditional advertising, Pay per click advertising is more cost effective and lets the sellers target specific audiences based on keywords, location etc. Also, it reduces extra spend over fruitless campaigns. Plus point is, you can never spend more than your affordability by keeping an eye on your budget. The detailed performance data make it easier to optimize ROI. By adjusting the campaigns, you can make it adaptable according to your business needs.
Understanding Amazon PPC
Types of Amazon PPC ads
Amazon mainly offers three main types of ads to attract the audience. Here are three types of Amazon PPC ads that you can create:
1-Sponsored Products
Amazon Sponsored product ad is the general type of Pay-Per-Click ad that uses keywords or products to promote individual products in search terms, other related pages or product detail pages. These pay-per-click advertising campaigns appear on the top, bottom, and side of search results. If you want to target a new product or are struggling with an underperforming product, then sponsored product ads are the ideal choice to drive instant sales.
2-Sponsored Brands
Amazon Sponsored brand ads, or headline search ads, are mainly used to advertise the brand. These pay-per-click ads feature a brand logo, a customized headline, and a product section. This sponsored brand ad is a good choice for sellers or vendors who want to drive an audience to their store or specific product page. You can see this PPC advertising at the top of search results, on sidebars, or at the bottom of search results. At the top, this PPC ad displays a tagline, brand log or product, however in video format it includes a 15-30 seconds video with a single product.
3-Sponsored Display
Sponsored Display is a self-service PPC ad that permits the sellers to advertise on and off Amazon. This ad type allows the seller to maximize visibility by re-engaging the audience. Unlike the other two PPC ads, the sponsored display ad has diversity in placements, as they can appear in diverse places on Amazon and other external websites through Amazon DSP. This ad is suitable for registered vendors on Amazon.
Comparison of Amazon PPC Ads
| Ad Type | When to Use | Why to Use | Placement |
| Sponsored Products | For launching a new product | Effective for product visibility and maximizing sales | Product detail page, Search results |
| Sponsored Brands | For Brand awareness and showcasing multiple products | Highlighting the brand and product portfolio to maximize recognition | Product pages ,Top of search results |
| Sponsored Display | For retargeting buyers and growing the audience | Target the buyers who viewed your products and also increase visibility across various platforms | Third party websites ,Apps, Amazon |
How to Create an Amazon PPC campaign?
Now that you’ve read about the basics of Amazon PPC and the various types of advertising, we’ll show you how to launch your first advertising campaign.
Step1
- Open the Amazon Seller Central, navigate to advertising and go to Campaign manager.
- Now, if you want to group multiple campaigns under one name you can create a portfolio by clicking on create a portfolio.
- Also, you can add a budget cap to your portfolio to stay within budget for a specific portfolio.
Next, scroll down more and click on the create campaign below the graph.
Now, you need to select the type of campaign .Choose “Sponsored Product “and click “continue”.
Step 2
- Now, give the campaign name
- We suggested giving a specific name according to the strategy that you will implement behind the campaign.
Naming Convention
Campaign Type-Targeting-Product Name-attributes
Set a start and end date for your campaign. If you want to run your campaign indefinitely, keep the portion blank.
Set an amount that you want to spend daily on ads. For the maximum effectiveness 10$ is the ideal choice for the initial campaign set up for the beginners.
e.g. Suppose your daily budget is about 10$ and keyword bid is 1$, so you will get 10 clicks per day on ad.
Step 3
Make an Ad Group
Next, create an ad group. It will help to organize different ads , and also their performance.
Note: Products in an advertising group have the same targeting and bids. Keep the ad group and campaign names similar.
Step 4
Select a Targeting strategy
There are two types of targeting strategy
- Manual
- Automatic
When you select manual targeting, there are two further options for targeting type per ad group
Select Keyword Targeting
Step 5
For the Keyword Targeting, you know need to select the match type of keywords
Broad: Broad phase keywords include a variety of search terms, related terms, and variations.
Phrase: It includes the keywords with some additional words.
Exact: It includes the high –performing specific terms that customers search.
So select the “Exact phase keywords” as they are ideal for targeted campaigns
Also, if you don’t have keywords, you can go to select the amazon suggestion keywords
Step 6
Campaign Bidding Strategy
Bid means how much you pay when someone clicks on an ad.
There are three types of bidding strategies
Dynamic bids down only
In bidding strategy, amazon automatically lowers your bid it considers that your ad is less likely to convert into sales. Hence, this will prevent your ad from appearing for irrelevant products.
Dynamic bid up and down
In this bid strategy amazon will change and raise your keyword bids 100% for the top search and 50% for other placements, if your ad is assumed to convert into sales.
Fix Bids
The name fix bids also shows, it will not change until you manually change them.
Select “Dynamic bids down only”
Automatic Targeting
In Amazon PPC, automatic targeting picks the keywords from the listing to target based on the customer’s behaviour and subsequently adjusts the bid over time and increases the conversions.
Automatic targeting is the best option if you’ve just launched your product and don’t have any keywords to target. Moreover, this automatic targeting has some pitfalls:
- Less control over campaign
- Spend more to collect the relevant data
Automatic Campaigns has different ads groups
Close Match
When a buyer searches a closely related search term, your product ads appear. e.g. if the product is “Running shoes”, Amazon will show ad to users if they search for “sprinting shoes”
Loose Match
When a buyer searches for loosely related keywords , then this product ad appears.e.g if the product is running shoes, amazon will show an ad to the users if they search “Best Sportswear”, “Athletic gear” etc.
Substitutes
When a buyer searches for a similar or a substitute product from another brand.If your product is running shoes and the users search for “Adidas shoes” your product may also be displayed.
Complements
When a buyer searches for a complementary product, these ads will show. E.g. your product is running shoes , so the customer searching for socks will also see this ad.
Amazon Advertising Key Terms and Features
Now, you have get to know how to create Amazon PPC campaign, lets move down to have a look at some key terms which are widely important in terms of advertising:
i. ACOS
ACOS stands for “Advertising cost of sale.” It measures the efficiency of an advertising campaign.
Here is the formula:
ACOS = (Ad Spend / Ad Revenue) x 100%
In short, it tells you how much money was spent on advertising for every dollar earned from the ad campaign. From ACOS, you choose the correct product, keywords, and bids. If you have all these things right, your profit level will increase.
ii. ROAS
ROAS means “return on ad spend.” It is a metric for determining the effectiveness of a digital advertising campaign. ROAS enables businesses to determine which strategies work and how to optimize upcoming marketing campaigns.
Formula:
ACOS = (Ad Spend / Ad Revenue) x 100%
iii. CTR
CTR is an abbreviation for “Click through Rate”. It is a metric that calculates the number of clicks an advertiser receives on their adverts per impression.
The CTR is the percentage of people who see your ad (impressions) and ultimately click it. The formula for CTR is as follows:
Total Clicks on Ad) / (Total Impressions) = Click-Through Rate
iv. CPC
CPC stands for “cost per click”. This means that you pay for each click on your advertisements. Clicks indicate that your ad has attracted attention, so this model implies that you’re paying for action rather than passive views.
There are benefits of using CPC:
• Control your costs
• Understand ad performance
• Focus on an engaged audience
• Maximize your ROI
How to calculate ACOS and ROAS profitability:
ROAS:
ROAS stands for “return on ad spend.” It is a metric that measures the efficacy of a digital advertising campaign.
Formula:
ACOS = (Ad Spend / Ad Revenue) x 100%
Profitability:
- A high ROAS generally indicates a profitable campaign.
- A low ROAS suggests the campaign may not be profitable.
ACOS:
ACOS is the percentage of sales spent on advertising. It represents how much you’re spending on ads to generate a sale.
Formula:
ACOS = (Ad Spend / Ad Revenue) x 100%
Profitability:
- A low ACOS indicates that your ads are effective at generating sales at a reasonable cost. This is typically a good sign of profitability.
- High ACOS suggests that your ad spend is eating too much into your sales revenue, making the campaign less profitable.
Amazon PPC is one of the most effective ways to enhance your business on Amazon. By the key metrics like ROAS, ACOS, CTR, and CPC, one can make informed decisions and achieve better returns on ad spend. These metrics are crucial for tracking performance.
Conclusion
Pay per Click Advertising is a powerful strategy that helps the marketers to attain recognition in the flooded Amazon marketplace.Understanding the basics of PPC, campaigns types and strategies, you can now achieve the desired results effectively.
Whether you are a beginner or a prominent brand who are seeking the experts’ advice for monitoring and optimizing PPC Campaign, AMZ Ladder is the one stop solution for all your advertising needs.
Don’t be late to avail the best Amazon PPC Strategy by AMZ Ladder!
FAQs
1-How much should I budget for Amazon PPC?
Well, it totally depended on the individual’s goals, and the return on investment(ROI)
2-Is PPC worth it on Amazon?
Yes, amazon PPC is worthy in various aspects, whether to drive sales, optimise and monitor the ads, PPC is a most influential strategy that contributes in the organic ranking.
3-Is Amazon PPC profitable?
Yes, if the advertising is done well. The profitability of the entire process is measurable. Also, you can see the exact return on investment through the CTR, CPC etc.
