Advertising on Amazon is a must for any seller who is serious about gaining or maintaining a strong foothold on the #1 online retailer in the world, but it is especially advantageous for launching a new product or boosting sales on existing listings. Read on below to learn more on what to do and look for during each phase of the Amazon advertising lifecycle.
When you are launching a new product on Amazon, it is critical to hit the ground running by advertising. But before you do, you should make sure your listing is fully optimized. Amazon looks at multiple factors to determine what products should show up for search queries.
If you do nothing when listing a new product, it will likely sit around and gather dust. This is because the product doesn’t have any sales velocity yet and, consequently, Amazon doesn’t deem it relevant to shoppers’ search queries. You have to remember that Amazon always prioritizes the buyer and wants to show them only the products that it thinks they will like. If there is no data to support the new product and its popularity, it likely won’t show up on search pages for any given search term.
In order to be proactive and start driving some sales, you will need to get the flywheel effect going and advertising is one of the easiest levers to pull. You can do this either through sponsored ads on Amazon or through external paid advertising platforms such as Facebook, Google, Pinterest, etc. Ideally, you should begin by advertising on all of them, testing different campaign strategies, and finding which platforms work best for your audience.
For instance, according to Statista, Pinterest’s users are 77% female, meaning that a male-centric product may perform better and have a higher Return on Ad Spend (ROAS) on other platforms. However, 23% of the 300+ million active users are male or unspecified, so you can’t know for sure until you’ve tested.
Whatever type of ad you choose to use, you should remember that the first and most important step is to generate maximum exposure for your product while targeting as many new (and relevant) shoppers as possible. This is when you will want to keep a close eye on impressions, which indicate the number of times a customer sees your ad. Next, you should focus on clicks to make sure your ad is helping to increase detail page views. Amazon considers both of these metrics when ranking products, which is another added bonus from advertising.
The first phase of the advertising life cycle usually lasts about three months and should be considered as an opportunity to test your hypothesis on which keywords, product targets, and audiences are the right fit. You should mainly focus on how to drive maximum traffic to your detail pages while discovering new keywords.
The purpose of the second phase is to drive incremental orders and sales through advertising. Thousands of impressions don’t mean anything if they don’t result in product sales. It becomes less important to generate ample, but mindless, traffic and more important to target the right customers who are likely to purchase your product.
This is also when the click-through-rate (CTR) becomes a focus point. While clicks tell you how many users clicked your ad, CTR takes into account how many impressions the ad has had, giving you a better picture of how well the ad performs. If a keyword has a high CTR, it is eliciting a consistent, positive response from shoppers, which indicates that the product is relevant to their search. However, if the CTR is high but sales are low, it means that the keyword may not be relevant to the product and isn’t meeting the expectations of the user.
It doesn’t make sense to pay for clicks that don’t lead to any conversions. On average, if a keyword has more than seven to ten clicks in Amazon without driving any sales, then the product is likely not a good match. However, the number of clicks to watch for depends on the product price: the higher price points require more clicks. If your keyword is not a good match, you should consider pausing the keyword or adding it as a negative. The goal is to start getting rid of wasted spend on keywords that are irrelevant to the product.
This phase lasts about six months and focuses on improving the conversion rate by matching your product with relevant search terms. It is important to build a sales history around these to increase the organic rank within Amazon.
This is the last phase of the advertising life cycle. The main objective is to drive profitable ad sales. Most advertisers have an advertising cost of sale (ACoS) target. Staying below the ACoS threshold assures that the advertising efforts are driving incremental sales at a rate that is higher than the cost of business.
You also need to consider the cost per click (CPC) and conversion rate of each keyword in order to optimize your campaign appropriately. A keyword could be generating many ad sales at a cost that negates the profit. By lowering your bid you may have to sacrifice some ad sales, but you will be more profitable in the attained sales.
You should prioritize category keywords that are driving the most incremental sales; the CPCs may be a little higher for these but remember that this improves the organic rank. You can then offset the high CPCs with lower ones on keywords that are less important to you. It is important that the overall ACoS of the campaign is below your threshold but other than that, you have room to choose which keywords to bid on and where to use your resources.
Advertising benefit’s are multifaceted; you can collect relevant data for your product while placing it in front of as many shoppers as possible. You can then utilize the data to optimize your product detail page by including high performing keywords, which in turn will help to improve your organic rank.
Amazon advertising, done right, can help you capture and maintain a strong foothold on Amazon. Pattern, on the other hand, can help you capture, maintain, and scale a strong foothold in the global ecommerce market.
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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.
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:
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.
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.
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.
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.