9 Sep-2015

Tips for Amazon Sponsored Product Ads

Tips for Amazon Sponsored Product Ads

With over two million Amazon sellers and millions and millions of products for sale on the world’s largest online marketplace, getting your product in front of the shopper is the cornerstone in every Amazon seller’s strategy. Often times, especially for newly listed products, you will find that your listing is buried deep in the search results. Enter Amazon Sponsored Products; an advertising service that can put your product front and center on the premium search result pages. If you are not familiar with Sponsored Products, look at the picture below (click to enlarge) and notice the products on the right (circled) and how they are on the first page of search results along with the best sellers. Those are advertising spots that sellers bid for. If you are diligent, patient and willing to invest a bit, you too can get your sponsored ads right there on the first page.

Sponsored products photo

Of course Amazon doesn’t just give that spot away, you have to bid for it with other sellers and it can get competitive. However, it’s not the case that whoever has the highest bid automatically wins. Amazon also looks at the keywords in the search and the probability that giving you that coveted ad space will convert into a sale. It’s also important to note that you only pay if the shopper clicks on your ad and to be eligible for Sponsored Products your product needs to be eligible for the Buy Box. Getting the coveted top advertising spot is competitive and Amazon keeps their algorithm that defines the prime parameters of sellers getting that top spot a secret. There are however a few best practice approaches that can help improve your ad performance.

Setting up your advertising campaign in seller central is relatively straight-forward and there’s a plethora of information available in case you get stuck so rather than focusing on the instructions to get started here we’ll discuss how Sponsored Products work and some methods for setting up and monitoring your campaign. Having personally discussed Sponsored Product strategies with the head of the division at Amazon, we learned that the title of your product is the single most important aspect which you can control to get the best Sponsored Product search results. Amazon allows you to use 120 characters in your product title, take advantage. For example, if you are selling kitchenware and the title of one of your products is “Bar Stool”, you have 2 common keywords that everyone else selling bar stools are bidding on. On the other hand, if you use the title “Adjustable 28” – 34” Brown Italian Leather and Stainless Steel Swiveling Modern Plush Kitchen Bar Stool with Footrest” then you have 13 keywords plus the height if the shopper is looking for a specific size of bar stool. Increasing the number of keywords increases the chances of matching the shoppers’ search. When it comes to the content of your listing, only the title matters in Sponsored Products, meaning the search terms will not match keywords in the product description or features.  

When you set up your Sponsored Product campaign you will need to enter a daily budget as well. We always start at $5 just to see the response. Check this daily as when you hit your budget your ads will stop appearing. If you keep hitting your daily budget but nothing is selling, that means people are clicking and viewing your product page but not buying anything. This could be due to an incomplete listing, poor product images or the price. Adjust what you can and lower your daily budget and try again. If you keep hitting your daily budget and you are making sales, that’s a good problem to have. Just continue to increase the daily budget gradually.

The bidding part of Sponsored Products pertains to how much you are willing to spend per click per keyword. When you set up your campaign you will notice that there is the option for Amazon to automatically select your keywords and another option for you to manually select your own keywords. You can enter different amounts for different keywords, and this is important because you should bid the most for the most relevant keywords, such as “bar stools” from the example above, and bid less for the more general keywords, such as “brown” and “adjustable”. Remember when you enter a bid it is not necessarily how much you will be charged per click, it is the maximum amount you are willing to pay. This means if you enter $0.80 for a keyword and the next highest bid from another seller is $0.60, you will pay $0.61. Reports of the winning average bid for every keyword you choose can also be downloaded so you can see where you stand. Impressions, clicks and spending should be monitored daily, especially when just starting out. Keep in mind that campaigns gain momentum and preferential treatment over time so it’s not a good idea to stop and remake campaigns constantly. For new campaigns it’s beneficial to start with higher budgets and bids and decrease them over time as the products sell and the positive reviews roll in.

When you are monitoring your Sponsored Product performance and spending, you will notice that the impressions are also counted. Impressions are the number of times your product appeared in a search. It’s worth noting that sometimes one of your products will have much more impressions, say 10,000, while another similar product will have much less, say 60. This disparity often happens between variations of the same product, for example a black toaster versus the same toaster but yellow. Remember that Amazon is going to feature the product with the variation that is most likely to sell, in the case of the toaster, in can be assumed that black toasters sell more than yellow toasters. Ergo, the black toaster is getting all the impressions. But don’t worry, when a shopper clicks on the ad it will take them to the product page where they can see all variations of the same product.

While Sponsored Products is a powerful advertising tool, each individual seller should make the appropriate calculations to make sure it’s right for their business because it is an investment and the costs can quickly outweigh the sales if not closely monitored. Remember that when you are first starting with Sponsored Products it pays to have a higher budget. As your campaign builds up steam (meaning sales and product reviews roll in) you can gradually decrease the bids. If you closely monitor and tweak your campaign, have some patience and be a good seller then eventually you will notice that your products will start rising in the organic search results as well.