Amazon Brand Halo Sales from Advertising: How it Works

Tony Morales

September 4, 2020

There are several factors that play into the Amazon incrementality equation that lead to Amazon Brand Halo sales. Unfortunately, Amazon keeps all this data confidential. While we can intelligently assume (given these factors) that there is a brand halo effect, it is incredibly difficult to estimate what that is for a given brand.

Amazon halo sales are additional sales on products that you aren't actively advertising for on Amazon that can be attributed to the advertising that you are running for other products. Simple, right? Let's dig deeper into the elements that lead to brand halo sales for some more context.

Elements associated with brand halo on Amazon

While it’s not black and white which pieces of the puzzle lead to a halo effect, below are the most common elements I would associate with Amazon’s advertising halo:

  1. Sales that fall outside of the attribution window
  2. Items added to cart but not purchased
  3. Items saved for a later date
  4. Wishlist items
  5. Amazon retargeting
  6. Exposures required to make buying decision
  7. BSR improvement
  8. LTV of acquiring new customers
  9. Preventing lost opportunity in branded search
  10. Off Amazon sales from price checking

ROAS, or Return on Ad Spend, relies on a very simple formula for calculating the financial benefit of advertising campaigns: Revenue / Cost. It is simple, digestible, and one of the best ways to measure ad performance. That said, it does not provide a complete picture of the advertising results.

Breaking down elements of Amazon brand halo sales

Calculating incrementality can be a bit of a science experiment. I like to think of Amazon Advertising Incrementality as the compound interest of constant visibility and increased sales velocity provided by advertising on Amazon.

Let’s look at the 10 aforementioned incrementality factors in an effort to add more color to this concept.

1. Sales that fall outside of the attribution window There are often times shoppers will add an item to the cart and not click the buy button. I am guilty of doing this on a regular basis—I find something that I like but I simply sit on it for a period of time before actually making the purchase.

Amazon Brand Halo Sales | Pattern

2. Items added to cart but not purchased There could be several reasons why an item is left in the vertical cart. It could be the timing of the necessity for the item, maybe it is a gift for a birthday or other event, and it is being saved for the future. Maybe the shopper is waiting to see if there is going to be a coupon or a price reduction.

3. Items saved for a later date I often find items that I would like to buy as a gift for a holiday or a recent past birthday and end up saving items for more appropriate timing.

4. Wishlist items Many people in the Amazon create wish lists and a variety of other lists where they shop for items and save them for a future purchase date. Personally, I collect chess sets, and I know that I often have a long wish list of things like chess sets or camping gear or nostalgic trinkets that I want one day, but don’t necessarily feel like buying immediately.

Amazon wishlist brand halo effect | Pattern

5. Amazon retargeting Every time we look at an item on Amazon and choose not to buy it, Amazon has an algorithm where they resurface those items to us. You may have been browsing and looking at the detail pages of several items, and you will notice the next handful of times that you login to Amazon (whether it be on your desktop or mobile device) you will see Amazon showcasing these items near the top of the home screen and prompting you to pick up where you left off and reminding you that you may have forgot them.

Amazon brand halo sales explained | Pattern

6. Exposures required to make buying decision It has been widely estimated that it can take between 6 to 20 exposures before a shopper makes a purchasing decision, especially if this is a new product or if the shopper is unfamiliar with your brand. Initial ads that may not have converted are simply laying the foundation for the shopper to receive the right amount of exposures before they feel comfortable making the decision to buy.

7. BSR improvement Amazon best seller rank is something that is very important to each item sold on Amazon. As the best seller rank improves, the organic placement of the item improves, giving it more exposure to a large array of shoppers.

what leads to brand halo on Amazon | Pattern

If the BSR improves in such a way that an item previously ranking on page 7 suddenly shows up on page 2, there is a much broader customer base that will see that item. If the Improved sales velocity from advertising is able to impact the item in such a way that it can organically be placed on the first page of search results or even within the top 20 items, there will be a dramatic improvement in organic sales that go straight to the top line at no cost to the advertiser.

8. LTV of acquiring new customers Acquiring new customers is important for any business, and repeat purchases help to maintain brand health. Advertising can operate in such a way that it reminds existing customers that they need to make a repeat purchase when they were planning to do it but just needed an extra nudge to get it done. Also, by exposing the brand to new customers, every new customer will have a lifetime value associated with them and they will potentially make future purchases without being prompted by a paid advertisement.

9. Preventing lost opportunity in branded search There’s good data showing that most customers who do branded searches will most likely purchase the brand they are searching for at some point. One big mistake some Amazon advertisers make is to lose a sale that was going to go your way to an item that may be slightly lower priced or have more reviews. There is an advertising effect to preventing this from happening and keeping the sales that were meant to go your way.

branded search Amazon brand halo | Pattern

10. Off Amazon sales from price checking It has been reported that more than 60% of product searches happen on Amazon first. Oftentimes shoppers may be in a brick and mortar retail establishment and using Amazon to do a price check on an item (this is called showrooming, read more on that here). Making sure that your item is present and discoverable may help a shopper to make a purchasing decision and increase the revenue for your brand even if that sale occurs off Amazon itself.

price checking Amazon brand halo effect | Pattern

There is also the case where a shopper may be in a brick and mortar retail establishment and discover that your Amazon price is cheaper than the in-store price or the store may be out of stock on the item they were looking for and they’re able to make the purchase on Amazon while they’re walking back to their car.

Calculating Amazon halo sales: What we don’t know

Trying to calculate incremental lift for all these components is very difficult because Amazon does not provide any insight about sales that fall outside of the attribution window or what percentage of the time that happens.

For example, we do not have any information about how long the average item stays inside of the shopper's cart before it’s purchased or how many items get removed or how many items live in a cart beyond the average time. We do not know how many Prime members have a wish list or how many items are on those wish lists. We do not know the success rate of Amazon’s retargeting efforts; we just know that it must work to some degree, or Amazon would not take the time to do it. We do not know the average number of exposures for each brand that it takes for a shopper to decide.

It is very difficult to correlate the organic sales left to BSR improvement. This is something that can actually be done by looking at BSR and page rank and sales over time, but it will take quite a bit of calculation. Amazon does not provide any information about search volume, so it is difficult to know how often you’re winning your own branded words and there are also no alerts on if you’re being conquested by a competitor. We also have no way of speculating the number of shoppers that are doing price checking from in-store or a different location and what the shoppers purchase intent is. We do know intuitively that all these factors are at play and definitely improve the overall lift of advertising.

The biggest benefit of incrementality will come from the increased sales velocity affecting the Amazon algorithm to provide your items with better organic placement, thus increasing the size of the organic slice of the sales pie chart.

Possible methods of calculating halo sales

Without the ability to put reliable inputs into the equation the brand halo of Amazon advertising is really a guess. I would speculate that depending on the amount someone is investing, what ad products they are using, what part of the sales funnel they are focusing on, and the size of their catalog, the halo effect could be anywhere from 5% to 60% lift over a 12 month period.

Products with a higher price point will see a larger halo benefit from extended advertising. Products and brands that are in the launch phase or the early stage of the product life cycle will see a larger halo left in the short run versus well-established brands.

You can do experiments such as turning your advertising off for a period of time and seeing how topline sales drop. You would probably want to do this for longer than a month just to see the extended effect of not running any ads. If you’ve been selling for a long time without advertising, you should have a good organic baseline and you could theoretically measure incrementality by beginning to advertise and taking your new total sales number and subtracting your advertised sales and your previous organic sales to see what the difference is.

Pattern’s Amazon advertising experts help our brands grow online. Want to learn how we do it? Reach out to us to schedule a demo.

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Sept 27, 2022

Global Ecommerce Weekly News: 27th September 2022

Get up to date with this week's ecommerce headlines from around the globe. --- Amazon News --- Amazon drives renewable energy push with 71 new projects Amazon is planning to add 2.7 gigawatts of clean energy capacity through a couple of new projects as the company attempts to use 100% renewable energy by 2025. The ecommerce business will soon have a total of 329 renewable energy projects, generating 50,000 gigawatt hours of clean energy, which is equivalent to powering 4.6 million US homes every year. [Read more on Reuters](https://www.reuters.com/business/sustainable-business/amazon-drives-renewable-energy-push-with-71-new-projects-2022-09-21/) Amazon launches Prime Early Access Sale Amazon is launching a new 2-day shopping event for its Prime members only, beginning on the 11th of October. Across 15 countries, Prime customers will have access to the shopping event, with thousands of deals on offer globall, ranging from fashion to electronics to essentials. The event has the purpose of giving Prime users the chance to spread the cost of items over the winter months, 6 weeks ahead of Black Friday. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/09/26/prime-early-access-sale/) --- Other Marketplace News --- Shopify unveils new localisation tool Shopify is launching a new localisation tool, called Translate & Adapt, which works with Shopify Markets to offer localisation for sellers who are looking to expand into new markets. The tool translates a user’s online store into different languages, including product pages and information pages. Merchants are also able to create different shipping terms for each market using the new tool, which allows international expansion and offers a more localised consumer experience, unveiling new potential. [Read more on Ecommerce News](https://ecommercenews.eu/shopify-launches-new-localisation-tool/) Etsy is set to invest hundreds of millions into its marketing platform Etsy CEO claims that the company is on route to spend more than $570 million USD on marketing this year. Even during a time of macroeconomic pressure, inflation and rising interest rates, the company is preparing itself and its sellers for the upcoming holiday season and is focused on retaining interest from buyers. [Read more on Yahoo News](https://uk.news.yahoo.com/etsy-600-million-on-marketing-ceo-154054219.html) --- Other Ecommerce News --- Meta looks to cut costs by 10% in the coming months Meta employees are facing job redundancies as the company plans to cut its costs by 10% over the next few months. Meta reported a 22% YoY increase in costs and expenses, totalling over $20 billion USD. The cuts are expected to come in the form of job redundancies as a result of department reorganisations rather than formal layoffs. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/09/22/meta-to-slash-costs-by-10-over-coming-months/) DHL teams up with Quadient to offer smart locker deliveries in the UK DHL and tech company, Quadient, have partnered to offer smart lockers parcel pick-up throughout the UK. The new contactless, secure locker stations will give recipients more choice and flexibility to receive their parcels at a time and location best suited to them. The partnership plans to install 500 locker stations across the country by the end of 2022. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/09/21/dhl-partners-with-quadient-to-offer-smart-locker-delivery/) The online fashion market is set to be worth nearly $170 billion USD in 2025 The European online fashion retail market is set to grow 50% by 2025, with an online turnover of $170 billion USD, which is 33% of the retail branch’s total. Cross-border marketplaces prove to be the largest drivers of this growth, with online websites and apps like Vinted largely pushing the market’s online growth. Zalando recently became the largest cross-border fashion retailer/marketplace, responsible for 11.7% of the online market’s share. [Read more on Ecommerce News](https://ecommercenews.eu/online-fashion-market-worth-e175-billion-in-2025/)
Sept 22, 2022

How an Amazon SEO Agency Should Be Serving Your Brand

If you’re in the global ecommerce space, you are most likely aware of Amazon, and probably selling your products on the marketplace. With over $470 billion in sales in 2021 alone, Amazon stands as the third largest company in the world based on revenue. The ecommerce giant is a household name in the U.S. and working hard to grow its market share across five continents worldwide.

Having your products available on Amazon and being competitive there, though, are definitely two different things. If you want to really succeed on Amazon, you’ll need specialized insight into how Amazon works and how to make it work for you. So, for many brands, it’s a great idea to work with an Amazon Search Engine Optimization (SEO) agency.

At Pattern, Amazon SEO optimization service is one of our key competencies. We understand that technology, data-driven insights and expertise  are the most important tools brands can leverage to win top listing spots on digital marketplaces. With expert teams and years of experience, we help brands conquer the Profitability Death Spiral as they compete with other products and sellers online. We offer Amazon SEO agency services as a core solution to brands that need more resources to get ahead. 

What is an Amazon SEO Agency?

An Amazon SEO agency serves brands by improving their products’ rank and listing performance on Amazon. They make strategic decisions about ad spending and placement that lead to higher traffic, conversions, and revenue for ecommerce brands.

A great Amazon SEO Agency partner will:

Prioritize Your Success

Unfortunately, many Amazon SEO agencies profit in unfair ways from your brands’ perceived success based on the ROAS numbers they provide. This is done through including branded search terms in ROAS reports, which naturally skew listing performance

Let’s say, for instance, your brand is called “Annie’s” and you sell lollipops. Your brand has a very high likelihood of winning the top listing spots on Amazon for lollipop search terms that are paired with “Annie’s,” your brand name. So, SEO agencies will spend your ad money on those terms and report a very high ROAS. 

To avoid scenarios like these, it’s best to look for an agency that either calculates their profits on metrics other than your ROAS scores or weighs branded search terms differently in the performance metrics reports. Regardless of your Amazon SEO agency’s cost structure, you should align onbranded search terms before committing to a scope of work.

Provide Detailed Competitive Insight

A great indicator of a high-quality Amazon SEO agency is the level of insight they can provide into your competitors’ listing positioning and how it compares to yours. Data fanaticism is so important at Pattern that we’ve developed proprietary technology to display this exact information with precise detail for every brand we work with. In fact, you can find our free version here to see how you compare to some of your top competitors based on ASIN.

It’s certainly possible to improve your Amazon search performance with blind spending strategies. But a truly great solution will help you to know where your dollars are at their most powerful and competitive.

Reduce Your Ad Spend Over Time

Amazon’s A10 algorithm prioritizes customer satisfaction—it wants to show consumers the best products that align with their search intent to improve conversions and sales. So, the best way to gain momentum on Amazon is to work on incremental wins. 

Improving your performance on more obscure search terms that align with your customers’ search intent is a great way to increase ROAS for the long term. A10 will reward your success with better rankings on higher-volume search terms and the virtuous cycle can help you conquer your most-coveted listing spots. And the best part? This process of gaining momentum, if done right, will naturally decrease your ad spend over time as Amazon recognizes your value and works with you to keep your products at the top of consumers’ search results.

Amazon SEO Optimization and More

As an Amazon SEO specialist, Pattern knows how to help your brand win better success for long-term profitability on Amazon. With our data-driven tools and brilliant teams of ecommerce experts, we help brands with listing management, content optimization, Amazon ad strategies, and more.

Contact us to learn more about our SEO optimization services.

Sept 20, 2022

4 Ecommerce Marketplace Consultant Must-Haves

Entering the ecommerce landscape is a huge undertaking for any brand—it usually requires a large investment in resources and expertise to really be successful. Any brand can quickly get in over their heads trying to navigate the nuances of SEO, fulfillment and logistics, distribution control, listing optimization, and meeting the numerous other requirements and administrative tasks to show up well on marketplaces. 

Unfortunately, because it’s so easy for third party, gray market, and unauthorized sellers to obtain and sell products online, many brands find themselves pressured to execute an ecommerce plan without the right resources to succeed on marketplaces and their other channels.

So, for brands looking to enter the ecommerce space or improve their current and future performance, it makes sense to partner with an ecommerce consultant.

Pattern’s global presence and proven success with hundreds of brands has allowed us to develop highly effective ecommerce consulting services. We can guide your brand to navigate issues both large and small in marketplaces worldwide. To maximize your ecommerce efforts, you’ll need to understand what an ecommerce consultant does and how to select one who drives the right value for your brand and products. 

What is an Ecommerce Consultant?

An ecommerce consultant is a specialist in the ecommerce space who can give you personalized guidance on how to market your products and grow their presence on digital marketplaces.

An ecommerce consultant should be able to analyze your brand, audience, category, opportunity, and current roadblocks and help you understand how to utilize your resources (or what resources are missing) to be most effective in capturing your opportunities in the ecommerce space.

Not sure how to evaluate a consultant? Here are 4 key attributes to look for as you make your choice.

1. Brand Obsession/Specialization/Passion

At Pattern, we prioritize brand obsession for a reason—we know that a brand-centered mindset makes a crucial difference in the outcomes and results our partners achieve. So in our experience, when you begin your search for an ecommerce consultant, it’s important to look for a partner who is specialized in ecommerce, invested in the product, and passionate about helping brands build and improve their strategies. Typically, this means finding someone that consults exclusively for ecommerce marketplaces, rather than choosing a consultant who offers many different services. 

2. Proven Results

It’s also important to avoid choosing a consulting partner who can’t deliver the right experience for your brand. The best indication of whether your potential consultant can do that is to review their history, data, and results with other brands. Ask if they’ve helped others in your selling category, if they’ve solved specific issues your brand is facing, and why they feel you are a good fit. The key is to leave the conversation feeling confident that you understand your consultants’ capabilities and whether or not they match up with your needs.

3. Wide Range of Marketplace Expertise

It’s best to pick a consultant who knows how to guide a brand onto and through multiple marketplaces worldwide. You’ll want to take a look at your long-term strategy and think about the regions and platforms you’re currently on and where you might want to take your brand in the future. If your consultant is truly great at what they do, they’ll be able to help you perform well enough with your current product roadmap that it’ll be a no-brainer to expand your presence at the right time.

4. Network of Resources

The most effective partnership with an ecommerce consultant will be able to give you both recommendations and point you to solutions for making those changes in your planning, processes, and execution. Your time and money is valuable, so you want to make sure that you’re spending it as efficiently as possible as you follow your consultant’s advice. So, before you commit to an ecommerce consultant, ask about the resources and concrete solutions they typically recommend to the brands they work with.

Achieve Your Ecommerce Goals With Pattern

Finding an ecommerce consultant that checks the boxes can be a difficult task. At Pattern, our entire focus and drive centers around giving brands the tools and resources they need to succeed on domestic and international ecommerce marketplaces. 

With over 100 global ecommerce consultants across 10 global offices, we have the right tools to partner with brands across the world to achieve better ecommerce success. We give specialized advice, then make sure our partners have all the adequate SEO, social media, CRM, Amazon multi-channel fulfillment services, and ecommerce outsourcing services they need.

Interested in ecommerce consulting services? Set up a call here to learn what Pattern can do for your brand on global marketplaces.