Amazon PPC: Your 2022 Optimization Guide

One of the amazing things about Amazon is the sheer volume of customers that can potentially use the site to discover your business. Every month, nearly 2.5 billion people search Amazon for everything from the useful, like household goods and groceries, to the truly bizarre, like a prefabricated home in a shipping container or a pillow featuring a photograph of Nicholas Cage. 

The things you can find on Amazon…

With a customer base as big as Amazon’s, no matter what you’re selling, chances are, someone is looking for it. Skai’s survey of 3,100 consumers throughout the US, UK, Germany, and France found more than half, 56%, of shoppers say they began their buyer’s journey by first searching Amazon for ideas. In this post, learn the ins-and-outs of Amazon PPC Advertising and some best practices so that you can get up and running quickly. 

Read this research from Skai

What is Amazon PPC?

Amazon PPC (pay-per-click) advertising is an amazing way for brands to reach consumers while they are actively researching purchases on the marketplace. Amazon PPC is much like GoogleAds and if you have used Amazon, you have almost definitely run into PPC advertising. Amazon PPC management uses a bidding system to help businesses get to the top of the browser’s search results.

But PPC is not a system where businesses can “set it and forget it.” Amazon PPC optimization means carefully creating ads that are both useful for the customer, enabling them to very quickly assess whether or not your product is right for them, as well as provide enough information for A9, Amazon’s ad ranking algorithm, to place the ad at the top of relevant searches. 

The great news is that Amazon PPC is actually a little bit easier to navigate than Google Ads if you know what you’re doing. That’s because, unlike Google, Amazon can place ads all over the site without hindering the user experience. 

Amazon PPC tips

There are over 9.7 million sellers worldwide on Amazon, with over a million new sellers added just this year. So whether your business is selling Nic Cage pillows or paper towels, if customers are searching for your product, they are probably going to find quite a few similar offerings. That is where PPC (or pay-per-click) advertising comes into play and there are some secrets you should know. 

Amazon PPC Guide

Here are a few tips for managing and optimizing your Amazon PPC in order to stand out from the crowd and rise to the top of Amazon search rankings:

Understand how Amazon advertising works

There are three main selling platforms on Amazon: Amazon FBA, Vendor Central and Seller Central. Vendor Central is for huge brands and Seller Central is for smaller retailers; however, the three platforms have many overlapping ad types. Fulfillment by Amazon is a service offered by Amazon, as a means for third-party sellers to automate their order fulfillment and shipping services. While anyone can sign up for Seller Central, those who wish to be a part of Vendor Central need to either be invited or fill out an application. Inside Seller Central, vendors can create two types of ads: Sponsored Products and Headline Search ads, which are both targeted by keyword.

All Amazon sellers use an auction system in order to bid on keywords. The winner of those keyword bids appears at the top of search results. Far and away, Amazon’s Sponsored Product ads are the most popular type of Amazon PPC ad, as they have a conversion rate of around 10 percent. Sponsored Product ads are those that appear at the top of search results and include product images and descriptions. 

Make friends with A9

As mentioned above, A9 is the name for the algorithm that crawls Amazon listings to see which ones make it to the top of relevant search results. One of the key messages from Skai’s recent Amazon white paper is that for brands to succeed on Amazon, they must keep their pages not only product-focused but also relevant to the expectations Amazon sets for sellers or face negative consequences:

“Leading the charge to keep Amazon the Earth’s most customer-centric company is an army of algorithms. Amazon advertisers are evaluated algorithmically by many factors such as in-stock rates, prices, profit margins, sell-through velocity, seller ratings, customer reviews, content quality, and conversion rates.

“You might be doing everything right from an advertising perspective, but if you don’t keep up with the rigorous fulfillment expectations, you might find that it will take you months to get your relevancy back on track. Unlike other marketing channels where the worst thing that can happen is that you waste a budget, with Amazon Advertising you could really hurt your business if not done correctly.”

SEO is every bit as important on Amazon as it is only Google, and understanding the requirements is critical for creating ads that connect with audiences.  

Consider becoming a registered brand 

Sellers with an active registered trademark that already have an Amazon account and can prove that they are the rights owner or authorized agent for that trademark have the option to become registered brands with Amazon PPC management.

This means that those businesses have access to Sponsored Brands advertisements, which, according to Amazon are “keyword-targeted ads that showcase your brand and product portfolio. Featuring your brand logo, a custom headline, and up to 3 of your product listings, these ads appear within search results.”

Own the SERP

The SERP—search engine results page—is like a battleground, and owning the SERP for your most important products means being top-of-mind for customers who are coming to Amazon to do their research.

As with any paid search program, your primary goal should be to capture the most attention when shoppers search on Amazon. You can “take over” the SERP using both Sponsored Products and Sponsored Brands to capture the most real estate on the page on top priority category terms.

In order to take control of the SERP, you first have to know your keywords. To arm yourself with the keyword knowledge you need, use Amazon’s search term report. This Amazon report shows all the search terms that triggered your ads to show, enabling you to strategically select new keywords, while also gaining an understanding of which terms work (or don’t work) for your product campaigns. This data also helps you refine your keyword strategy and identify negative keywords (those where you don’t want your product to appear). 

Think of your Amazon ads as online window displays

To maximize the impact of Amazon for your business, think of your paid search ads as invitations for customers to come in and look around. If you had a physical storefront in a mall, chances are, shoppers wandering by might see your window and come inside to browse and ask questions. 

It’s no different with Amazon, which plays a key role in product research with reviews, questions/answers, and high-quality images & videos. As mentioned above, consumer surveys prove that many U.S. digital shoppers now start their product searches on Amazon. And those searches begin by seeing products at the top of the SERP that are visually appealing with intriguing copy.

Understanding the influential role that Amazon plays in today’s customer journey, starting with that first Sponsored Product or Sponsored Brand encounter, makes for a holistic approach to planning and organizing for your customer’s journey and truly maximizes the full power that this marketplace can have on your business.

Use your Sponsored Products to sell non-promoted products 

Once you are at the top of the SERP for a specific product and that product is acting as an effective “window display,” you are in an excellent position to earn attention for your other products as well. Using paid ads to promote your entire product catalog is a huge part of Amazon PPC optimization.

Amazon’s gross merchandise sales for Prime Day 2021 totaled $11.19 billion worldwide in comparison to its $10.4 billion earnings in 2020. Prime Day 2022 is projected to kick off in July 2022 to commemorate the anniversary dates of previous Prime Days. And while not every day is Prime Day, these numbers are a great example of how putting one product into an Amazon shopping cart often leads to adding another. 

Online shopping—especially via Amazon—has shifted the power to consumers as they can easily browse and compare dozens of items in seconds to hone in on the exact item they want. Consider carefully when deciding which products to promote via Amazon PPC. You might want to push products that are cool and unique, but if they are virtual “dead ends” for shoppers who are only a click away from the rest of your catalog, maybe items that naturally lead to other purchases are better choices because they will engage consumers and prompt them to check out everything else you have.

Use Amazon PPC to build brand loyalty

One of the common mistakes that marketers make with Amazon is to approach it strictly as a direct response channel. Marketers who are solely concerned with common advertising key performance indicators (KPIs) such as Return-on-Ad-Spend (ROAS) and Cost-per-Action (CPA) are missing the potential of Amazon to help build lasting relationships with new and returning customers. 

While Amazon has been much maligned as helping to kill the good old days of customers returning to the same stores over and over for their purchases, the “Order Again” function is actually very powerful. And one of the first places to start is with paid search ads. Two-thirds of respondents (66%) typically start their search for new products on Amazon. Owning that SERP and drawing customers in with a compelling ad, then delivering on those promises by providing excellent customer service might mean that customers stop searching–and make your business their go-to. 

Make sure there is synergy in your paid search strategy

Recently, Google changed their site link extensions policy, officially allowing brands to link from their product ads to select store pages—including Amazon. Take advantage of this somewhat understated opportunity in 2019 because, by next year, your rivals will all know about this and you won’t have the same competitive advantage that you have right now.

Don’t forget that social ads can drive Amazon performance. eMarketer reports that of consumers who engage with brands on Facebook and ultimately purchase, 42% convert on Amazon. The cross-channel power here is undeniable.

Organize your Amazon calendar 

Prime day on Amazon is obviously huge. So huge, in fact, that Prime Day 2021 resulted in 255 million items sold on Amazon, which dwarfed other huge shopping days–like Black Friday and Cyber Monday. This year, Prime Day was actually bigger than both days combined. 

However, while customers are obviously looking for big savings on Prime Day, and all sellers would be smart to prepare well ahead of time, Amazon advertisers should also have a year-round calendar with a plan for promoting products accordingly. Prime Day and the winter holidays are huge, but be aware of business-specific ways your customers’ searches might change throughout the year. For example, avid gardeners are probably searching many different terms just before the spring thaw than they are at the height of summer. Planning for those searches well ahead of time is the best solution for staying on top of the SERP. 

Build campaigns around the calendar 

Planning for big days on Amazon, like Prime Day, but also Cyber Monday, or any time period where your products will be in high demand means creating individual strategies for the lead-up, the big day, and the lead-out. Every element of the program should be scrutinized: bids, budgets, ad creative, etc. Here’s a three-step guide to managing your Amazon PPC software for busy times of the year:

1. During the lead-up (2-3 weeks before the actual event), promote your deals & brand to researching audiences, and test ad tactics to see which ones work best 
2. On the targeted day (or days), convert brand-aware audiences to purchase your products and use the insights from the lead-up to run on the most optimized strategies 
3. During the lead-out (2+ weeks after the calendar event), re-engage your audiences at scale

Amazon PPC management software to help master the opportunity

Of course, planning and preparing to optimize Amazon PPC ads requires a holistic view of campaigns, audience engagement, and product positioning in order to make smart advertising investments in the fast-paced world of Amazon PPC advertising. Adopting tools that provide visibility into every facet of your listed products and provide real-time insights for scaling campaigns, like Skai’s Product Manager is critical for making the most of your Amazon spend.  

Even if you’re not in the market yet for an Amazon platform, why not do a quick demo and see what Skai Retail Media can offer? It has advanced features and functionality to help drive performance, increase productivity, and arm your Amazon PPC optimizationallow team with data and insights to grow your program.

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