Tag: Sponsored Products

On January 1st Amazon released three new features in sponsored products, Dynamic Bidding, Bid Adjustments, and Placements. Among a variety of benefits, these new features led the Viral Launch R&D team to a major discovery. This discovery has resulted in the development of a new PPC bidding/optimization strategy that is driving incredible results for sellers implementing the strategy properly. It’s important to note that this is one of many strategies we use and you can employ, and it really depends on the product and the market as to which one works best.

This post will walk you through the details of this new PPC tactic we’re calling Placement Optimization strategy and how you can begin using Placement Optimization in your PPC campaigns and begin seeing results immediately!

What Are Bid Adjustments & Placements

Performance by Placement

Once in Seller Central, you can click into a campaign and view a new tab titled “Placements.”  This new Placements tab provides insights into your campaign’s performance based on where the ad was displayed at the time. Amazon breaks it down into three placement groups: top of search (first page), rest of search, and product pages (defined below).

Top of Search – The top of search (first page) refers to the sponsored products ads at the top row on the first page of search results.

Rest of Search – Rest of search refers to sponsored products ads shown in the middle or at the bottom of search results, and all sponsored products ads in the second page of search results and beyond.

Product Detail Pages – Product pages refers to sponsored products placements on the product details page, and certain other placements off search results like the add-to-cart page. These ads show in the Sponsored Products Related To section on a listing’s detail page. Ads can show here through keyword targeting campaigns or by setting up product targeting campaigns.

Bid Adjustments by Placement

Bid Adjustments put the control in your hands to allow Amazon to spend above and beyond your set CPC for a specific placement. Amazon allows a number between 0 and 900% as a modifier to your set bid. Amazon does not allow you to set a specific bid amount for each placement, only this bid adjustment.

“For example, if you have set your CPC to $2.00 and Dynamic Bidding – Down Only selected, but set the Bid Adjustment to 50% for “Top of Search”, Amazon will bid up to $3.00 allowing for more positioning in the top sponsored ad results.


We’ll discuss below how to really take advantage of this feature to maximize your ad’s top of search placements.  

Our Mind Blowing Discovery

After looking through the placements report for a number of campaigns we are managing, we noticed some interesting tendencies around how frequently our keyword targeting campaigns (auto campaign, broad/phrase match campaigns, etc.) were showing on product pages. So we aggregated over $1MM in ad spend worth of campaigns to look at what was happening at a wide scale.

Here are the mind blowing stats:

On average ~84% of our newer keyword targeting campaigns are delivering on product pages!

We knew that ASIN targeting campaigns typically have a low click-through rate (CTR%), but this explained why some search terms had incredibly poor CTR%; they were delivering mostly on product pages! Meanwhile, while the clicks were more expensive, conversion rate (Conv.%) was ~60% higher for top of search traffic. It makes sense that a prospective customer is more likely to click into a product at the top of the search results for a given keyword than on a sponsored product showing on a competing product.

What was so mind blowing is that, this whole time advertisers have been turning on / turning off keywords based on their performance (CTR, Conversion, ACOS, etc.) assuming that keywords are / are not relevant based on the aggregated performance. In reality, those keywords we thought our products were not very relevant for, may have performed well for top search, but just happened to be a worse offer on the product pages Amazon decided to show us on.

For example, let’s say you are selling fish oil pills at a higher than average price point with only a handful of reviews. You run campaigns for the keywords “fish oil pills” and “omega 3 pills”. Prior to the insights Amazon’s new Placements feature provided, if the campaign targeting “omega 3 pills” resulted in low CTR, low conversion rate, and a high ACOS, you would assume that customers do not find your product very relevant for “omega 3” related keywords. In reality, there is a chance that Amazon was simply showing your new product with low reviews and a high price, on competitor pages where the competing products had more reviews and a lower price point. It’s very possible that your product was performing well for the “omega 3” keyword, but it was not performing well on the specific competitor listings Amazon chose to show you on.

Put differently, this should challenge everything you know about how relevant your product is for various keywords! There may be plenty of keywords you had passed off as poor performing and less relevant you may find actually perform well in search alone.

Fortunately, you have the opportunity to look at Placement reports for historical campaigns to begin answering some of the questions.

How To Use This Placement Optimization To Boost Efficiency

Within just over a week of releasing this new Placement Optimization strategy, we’ve received an overwhelming amount of positive feedback and case studies on improvements to campaign efficiency and/or overall sales improvements. We want to make sure you have the knowledge to be able to apply it yourself!

The case study below highlights how removing inefficient traffic from product pages allows the traffic to flow through our most profitable placement. By allocating 100% of the budget to top of search, we saw a significant increase in sales and a significant decrease in ACoS!

1/1/19 – 1/7/19

1/21/19 – 1/27/19

In this section we will walk through:

  1. How to Isolate Traffic with Bid Adjustments
  2. How to apply the strategy for maximizing efficiency/sales

How to Isolate Traffic with Bid Adjustments

The R&D team at VL has come up with a quick and simple solution to segment ad traffic across ad campaigns to optimize efficiency across delivery placements.

To set up a campaign that will only deliver for Top of Search ad placements, set a low base bid for the keywords targeted i.e. $0.30.  A high percentage bid modifier can then be applied to Top of Search bid adjustment (ex. 800%). This will keep the bid amount low enough to not deliver in auctions for other placements, while also modifying the bid amount to deliver in the top ad placements only. Example: $0.30 bid with 800% modifier will deliver only at Top of Search placements at $2.40 bid.

WARNING: You should not force all campaigns to target only top of search. You need to follow the data for your own product and make sure it fits within your broader PPC strategy, which we discuss below. Test and analyze the results of each placement before making any decisions!

How to apply the strategy for maximizing efficiency/sales

Step One: Analyze existing campaigns. Consider historic performance, campaign type, match type and campaign objectives. Further, with the release of campaign bidding strategies, Amazon has made it extremely easy to spend more than you intended. It is our recommendation that you do this test initially with Dynamic Bidding – Down Only as your selected bidding strategy. Having an Up & Down bidding strategy selected could result in Amazon spending an additional 100% of your bid on top of your placement multiplier! This could lead to major overspending if left unchecked.

Other situations and scenarios to consider:

  • Since Placements are set for the entire campaign, if you have a lot of keywords in a single campaign, it’s difficult to know which keywords are actually delivering at top of search.
  • Auto campaigns are difficult to control, so a top of search tactic might change the words it’s delivering for and make the historic data you’re basing the decision off of useless for Placement decisions.
  • Lastly, if your campaign is performing well in all ad placements, there is a risk that changing it will disrupt that performance so you might want to instead just increase spend on that campaign.
  • If you are starting a new campaign, it is recommended that you gather data around each placement before setting any bid multipliers. Discover whether or not your product converts well for all placements and then adjust accordingly. To get some initial profitable sales, listen to our Product Targeting podcast where we discuss what can be one of Amazon’s most efficient traffic sources!

Step Two: If a campaign is spending above your target ACOS in one placement (ex. top of search or product pages) while spending below your target ACOS in another placement, then this is an indicator that you should begin isolating traffic away from the inefficient placement. In some instances, top of search is the unprofitable placement, while in other instances, product pages are the unprofitable placement.

If all placements are performing below ACOS, that’s great. You may have an opportunity to scale up your budget and increase your sales!

Step Three: If you have crunched the numbers and decided to focus traffic toward top of search, look at the bid you’ve been delivering at top of search for. Set a bid and bid adjustment to focus on that traffic. For example, the top of search (first page) clicks below have been delivering at an average CPC of $0.95. If you want to isolate traffic, you can do the math. You could set your bid to $1.00 for top of search by setting a bid of $0.13 ($1/800%). By not having a premium on product page placements, your campaign should divert traffic from inefficient product pages and push more impressions and clicks through top of search where you’re more likely to get sales!

If you’ve spent a lot of time and/or money doing Amazon’s PPC, you know there are a few levels between what you try to do and what Amazon delivers; and Placements is no exception. After you change the placements, you need to monitor results very closely to make sure it’s performing at the efficiency and effectiveness you want.

Practices to Avoid While Testing

We recommend everyone go test these new bidding strategies and placement adjustments based on the goals and objectives of their campaigns. When testing these new strategies, there are a few things that you should be sure to avoid…

  • Applying a large bid multiplier to top of search on campaigns that perform well for product page placements. If your campaign is running within desired ACoS and driving a significant amount of sales, it is not advised to interrupt the efficient flow of ad traffic.
  • Testing new bidding strategies such as Dynamic Bidding – Up & Down on a new campaign. Without a significant amount of ad history and data, Amazon will struggle in determining whether or not your ad is likely to convert. Test the impact of this new feature on an existing campaign to fully understand the impact it may have on your Amazon advertising methods.
  • Creating two campaigns with the same keyword set, bids, etc… and testing them against one another using different bidding strategies. Since both campaigns have the same keyword set, they would be competing against one another for the same auctions. Testing in this manner will likely lead to results that do not accurately represent how the campaign is likely to perform in an unbiased testing environment.
  • Recreating an existing campaign with a new bidding Up & Down bidding strategy. By copying the original campaign and creating a new one, you are essentially setting up a brand new ad that Amazon has never seen before. This campaign would have no ad history making it difficult for Amazon to predict the likelihood of a conversion in any given auction.

Conclusion

Adjusting bids by Placement can be a really powerful strategy to change how your campaign delivers. Now that you know what to look for, and how to make the change, you’re ready to go out and dig into your own campaigns. You need to follow the data for your campaigns and make sure that you are making the right decision for your product and campaign. Check your campaign metrics regularly and Follow The Data!

As an Amazon seller, your main goal is to get your product in front of as many buyers as possible. But with competition high, where do you even start? Thankfully, there are several Amazon advertising tools designed to help sellers promote their products.

From sponsored ads and video ads to storefronts and more, sellers have plenty of options for how to advertise their Amazon products and brands. In this guide, we’ll cover what each of these advertising options are and how you can use them for your business. But first, let’s discuss a big change Amazon recently made to its advertising platform.

What’s in a Name? Amazon Advertising Rebrand

Come with me on a journey through time and space to August 2018. It was a different, more confusing time in the Amazon ecosystem. Back then, Amazon sellers looking to advertise their products had to wade through three different marketing channels and decide which one was best for their business. Amazon offered AMG (Amazon Media Group), AMS (Amazon Marketing Services) and AAP (Amazon Advertising Platform) as their three marketing pillars.

However, the disjointed nature of having multiple advertising platforms was seen as unnecessarily confusing to a lot of sellers. Many people found it hard to decipher where you needed to go to run the types of ads you wanted with so many different acronyms and platforms.

In September 2018, Amazon began phasing out the three-headed monster of AMG, AMS and AAP, opting rather to combine them all into one advertising platform. Now anything that has to do with advertising on Amazon falls under the umbrella of Amazon Advertising.

Head over to Amazon Advertising if you’re looking for any of these services or features:

Amazon Advertising

To make sure you understand all the options at your fingertips, let’s dive into each one.

Sponsored Product Ads

In short, Sponsored Ads are pay-per-click advertisements that allow brands to promote their products with keyword-targeted ads. As you’ve shopped on Amazon before, you’ve likely seen these ads. These appear with a small “Sponsored” tag after you’ve typed in a related keyword. Sponsored Product ads can show up at the top or within search results and on product detail pages. They will also appear on mobile and tablet browsers, as well as apps. As an example, when searching “garlic press,” I was given these Sponsored Ads:

Amazon Marketing Services

How Much do Sponsored Product Ads Cost?

As previously mentioned, these types of ads use a cost-per-click, auction-based pricing model. This means you are bidding against other sellers to get that spot within search results. You set the maximum amount you are willing to pay when a shopper clicks on your ad. The more competitive your bid is, the better chance it has to be displayed.

As you can see in the image below, this is what the Sponsored Ads user interface looks like. In the first column, you can enter your bid for the ad. To help sellers choose the right bid, Amazon will provide you with a suggested price range. As you’re getting started, bid within or just slightly over the suggested amount. You can always adjust from there if you are not getting desired results from your campaign.

Amazon Advertising

Once you’ve got campaigns ready to go, you can also set your budget: the maximum daily amount you’re willing to spend over a calendar month.

Amazon Marketing Services

 

Ready to Start Building Your First Campaign?

Check out this webinar from Amazon:

Now that you have a basic understanding of what Sponsored Products are, let’s move onto the next advertising option.

Sponsored Brands

Formerly known as Headline Search Ads, Sponsored Brands are keyword-targeted ads that allow brands to have a custom headline and logo within their ad. Brands use these advertisements to drive shoppers to a custom landing page or their Amazon Store. These ads show up on the left side of search results and at the top and bottom of the page. They can also appear on both desktop and mobile browsers, as well as the Amazon app.

Amazon Advertising

 

Who is Eligible for Sponsored Brands?

Only third party products that are enrolled in Brand Registry are eligible to utilize Sponsored Brands. The products must also be new and fall into one of the categories below.

Note: Adult products, used products, and refurbished products are not eligible for the Sponsored Brands program.

Amazon Advertising

How Much Do Sponsored Brands Cost?

Similar to Sponsored Product Ads, Sponsored Brands use a cost-per-click, auction-based pricing model. You set the maximum amount you’re willing to pay when a shopper clicks your ad. The more competitive your bid is, the more likely it is that your ad will be displayed.

While there are a lot of similarities with Sponsored Product Ads, the daily budget works a little bit different for Sponsored Brands. You set the maximum daily amount you’re willing to spend on ads, but it does not roll over to the next day. This is unlike Sponsored Product Ads, which uses an average for the month.

Display Ads

Like sponsored ads, Display Ads also use a pay-per-click model. However, there are some differences. While sponsored ads are keyword targeted, Display Ads allow you to target your ad based on shopper interest or a specific product. Display Ads can appear in a number of places for both desktop and mobile users, including:

  • Detail pages
  • Below search results
  • Customer review pages
  • Top of the offer listing page

This image shows a Display Ad appearing directly under the checkout options on the right side of the page.

Amazon Marketing Services

In addition to the areas listed above, these ads may also appear in Amazon merchandising emails.

Want some more information about Display Ads?

Check out this video from Amazon:

 

Video Ads

Video Ads are a great way for advertisers to really tell their brand story and engage customers in a unique way. These ads show up in brand-safe environments via trusted channels like Amazon, IMDb or on exclusive Amazon devices like Fire TV or Fire tablet, as well as across many third-party sites and apps. As you can see below, videos are showing up on the bottom of a webpage as well as on a smartphone.

Amazon Advertising

One major point to remember about video ads is they require a budget of $35,000 or more in the United States. These are typically going to be utilized by sellers or brands that have bigger advertising budgets.

Stores

Stores allow sellers to create their own website within Amazon with its own branded URL. This is a great way to showcase your brand story and product portfolio in a curated customer destination while providing a place to drive advertisements to. They don’t require any coding skills to set up and, as you can see below, provide a multi-page shopping experience.

Amazon Advertising

Amazon DSP

Known formerly as Amazon Advertising Platform (AAP), Amazon DSP is a demand-side platform. This allows sellers to programmatically reach audiences on Amazon sites as well as through publishing partners and third-party exchanges. Unlike other advertising options where the main goal is to have a direct impact on sales, the main goal of DSP campaigns are to build brand and product awareness. This is more for companies that understand the nature of brand advertising and are already running display ads on other platforms.

Amazon Marketing Services

Measurement

The Measurement tools of Amazon Advertising allow sellers to see how their campaigns are performing. Here are some of the most important terms to understand:

  • Impression: An impression is generated every time your ad is displayed.
  • Click: A click is generated when a user clicks or taps your ad.
  • Click-through rate: Click-through rate is the number of clicks your ad generates divided by the number of times your ad is displayed (impressions).
  • Detail page view: A detail page view, or DPV, occurs when a customer visits one of your brand’s product detail pages after clicking your ad.
  • Total sales: Sum of sales attributed to your campaign. A sale is attributed to your campaign each time a customer clicks your ad and purchases your products within 14 days. It takes 3 days after your first click for this data to begin showing in your report.
  • ACOS: The average advertising cost of sales (ACOS) is the amount you’ve spent on a campaign divided by the total sales attributed to your ad.

In this section of Amazon Advertising, sellers are able to run many different reports to check how their campaigns are performing.

Advertising on Amazon: Find What Works for You

While standing out on Amazon can be difficult, these days sellers have plenty of tools to advertise their products. However, running Sponsored or Display Ads or utilizing any of the other marketing strategies won’t automatically ensure success.

A lot of the Amazon game (advertising included), comes down to good old fashioned research along with trial and error.

If you’re going to jump into running Sponsored Ad campaigns for your product, you need to be fully aware of what you’re willing to spend on your advertising campaign as a whole so you can properly set bids and your budget. It also might behoove you to start with a wider net of keywords, let the campaign run, and then pick out a few of the keywords that perform the best.

The point here is, you need to figure out what strategy and advertising options work for you and your goals. If something isn’t working, take note and adjust accordingly before moving forward.

Here at Viral Launch, we want to provide you with all the information you need to become a successful Amazon seller. For more on Amazon selling strategies, we encourage you to subscribe to our blog, check out our Youtube channel, and listen to our Follow the Data podcast.