Real talk time: If you want to be successful on Amazon in 2020 and beyond, you need to have a good Amazon PPC management strategy.
Amazon Pay-per-Click (PPC) is Amazon’s internal advertising system. Through Amazon PPC, professional sellers can create advertisements for their products which show up for certain keywords in Amazon’s search results and competitor product listings.
Here’s what this detailed article will cover:
What is Amazon PPC?
Amazon PPC is the advertising platform Amazon makes available to its third-party sellers. It allows sellers to create ad campaigns for their products, and then charges them each time a potential customer clicks and views their ad.
Before we get into the details of PPC though, it’s important to understand Amazon’s key PPC metrics. This is how Amazon describes each one:
- Advertising Cost of Sales (ACoS): The percent of attributed sales spent on advertising. This is calculated by dividing total ad spend by attributed sales. For example, if you spent $4 on advertising resulting in attributed sales of $20, your ACoS would be 20% (ie. $4/$20 = 0.20).
- Attributed Sales: The total product sales generated within one week of clicks on your ads. Your sales data can take up to 48 hours to populate so, as a result, sales data is not available in the ‘Today’ date range and may be delayed to the ‘Yesterday’ date range. You can view the individual sales totals for advertised products and other products in the Campaign Performance report.
- Impressions: The number of times your ads were displayed. Once identified, it may take up to three days to remove invalid clicks from your reports. Clicks from the last three days may be adjusted due to click invalidation.
- Clicks: The number of times your ads were clicked. Once identified, it may take up to 3 days to remove invalid clicks from your reports. Clicks from the last three days may be adjusted due to click invalidation.
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Why is PPC important for Amazon sellers
The easiest way to get your products noticed on Amazon is through Amazon Pay-per-Click (PPC) ads. After all, there are close to 120 million products on Amazon, and you don’t want your listings to get lost in the noise.
And while your organic ranking — the place where your product appears in search results naturally — is important, advertisements help increase your product’s reach on the platform.
If created and managed properly, an Amazon Pay-Per-Click (PPC) campaign on Amazon can help you sell more inventory, sell it at a faster rate, and increase your organic ranking.
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How to create an Amazon PPC strategy
While each section of this article offers a detailed overview of Amazon PPC and the individual strategies for each, here are the basics of a good Amazon PPC management strategy.
- Test out each type of PPC ad campaign, especially automatic and manual.
- Perform detailed keyword research using Jungle Scout’s Keyword Scout, focusing both on related keywords and competitor products.
- When starting out, set daily budgets and default bids 150-200% higher than what Amazon recommends.
- Let ad campaigns run for one week before running reports and making adjustments.
- Use ad reports from your automatic campaigns to find keywords for your manual campaigns.
- Before adjusting or removing a keyword from a manual campaign, make sure the keyword gets at least 10 clicks.
- Continue reviewing your ad reports once a week, subtracting, adding, and adjusting keywords as needed.
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Choosing which type of Amazon PPC ad is right for your business
When starting out, we recommend that you try each one of the ads available to you — especially automatic-targeting ads and manually-targeting sponsored product ads.
These two ad types help you get the best picture of what sorts of keywords and search terms you should target on Amazon.
Plus, by trying out all of the different ad types, you can find out which ones work for you and which ones don’t. Then, once you have enough data, you can remove ads that aren’t working while boosting those that are performing well.
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Types of Amazon PPC ads
1. Sponsored product ads
Sponsored product ads are the advertisements on Amazon that appear in search results and product listing pages. This is the most common type of Amazon PPC ad.
When creating sponsored product ads, there are two types of ads that a seller can create.
- Automatic-targeting ads. An automatic-targeting ad focuses on keywords that Amazon’s algorithm determines to be related to your product listing. Over time, Amazon uses the data it collects from clicks and purchases, then adjusts the ads to better suit your listing and increase your conversions.. This is the easiest type of sponsored product ad to create. The downside is that it lacks the optimization options that other ad types possess.
- Manual-targeting ads. A manual-targeting ad focuses on specified keywords or like-products of your choosing. Because this is more “hands-on”, you’ll need to monitor changes in costs and make adjustments where applicable. This optimization often results in more effective ads and lower long-term ad spend.
Within manual-targeting ads, there are two sub-types:
- Manual-keyword-targeting sponsored product ads
- Manual-product-targeting sponsored product ads.
We go into greater detail on these two sub-types later in this article.
2. Sponsored brand ads
Sponsored brand ads, sometimes called ‘headline search ads’, appear at the top of Amazon searches. A sponsored brand ad allows a seller to include a logo, headline, and three or more products. To use sponsored brand ads, a seller must have a minimum of three brand-registered products on Amazon.
3. Sponsored display ads
Sponsored display ads allow sellers to target shoppers who’ve already visited their page. Amazon automatically creates ads targeting those customers on its affiliate sites, including Google, Facebook, Netflix, and even mobile phone apps. Like sponsored brand ads, a seller must have a registered brand in order to utilize sponsored display ads.
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The ultimate guide to creating every type of Amazon PPC ad
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If you have any Amazon PPC tips and tactics that have worked for you, please share them in the comments. We’d love to hear them!