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Amazon recently released its Q4 performance to Search Engine Journal and it turns out they smashed it. Ad revenue from Q4 was up 41% YoY & the quarterly revenue went above $4 billion for the first time in the 4th quarter ever!
This makes Amazon's ad revenue from 2019 approximately $14.1 billion, which is a 39% increase from the $10.1 billion they saw in 2018. With this Amazon takes the title of the 3rd biggest ad platform of 2019 behind Google & Facebook.
More people are now focusing on Amazon ads as the penny drops that it's a really good platform to advertise on if you're an e-commerce business.
I am here to introduce you to the world of advertising on Amazon, let's go.
Let's start right at the beginning. There are 3 types of ads on Amazon, Sponsored Product Ads, Sponsored Brand Ads & Sponsored Display Ads & amongst the 3 of them, they achieve 3 particular things really well.
Best practice: make good use of negative keywords. Start with automatic targeting.
Best practice: Make use of 30-40 keywords, A/B test ads. Use actionable headlines with a good CTA.
Best practice: run continuously.
So with targeting you can go one of two routes, you can make use of manual targeting, choose your keywords, products or categories to target, or you can use automatic targeting, typically lower bidding, good for keyword research and as a starting point. With automatic targeting, Amazon decides what products are relevant to each other and shows your ads where it’s algorithm deems relevant.
Any product that is retail ready can be advertised. Retail ready is essentially a scale you should measure your product against to predict if your product will perform well being advertised.
Aside from that, to advertise your products, that specific product needs to be winning the buy box.
The buy box is the actual part of the Amazon product detail page where it says ‘Add to Basket’ or ‘Buy Now’. When multiple sellers are selling the same product they are all listed on the product detail page. The person winning the buy box at the time of purchase wins the sale, therefore all sellers compete for the buy box.
If you aren’t winning the buy box, sponsored product ads on the products not winning the buy box will get paused automatically. Individual sellers aren’t eligible for buy box & on top of that, you can’t win buy box if your product isn’t new & in stock.
You need a good reputation, customer reviews. It helps to have your orders fulfilled by Amazon, be price competitive, be retail ready, minimise shipping time and give good customer experience.
So this is the basics of Amazon ads, naturally, there’s more to it than making the ad, targeting the ad & making the ad win. If you want some deeper insight into the world of Amazon Ads & how it can help your e-commerce business get in touch with us.
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