Complete Beginner’s Guide to Amazon Advertising to Increase Your Sales

Amazon advertising offers some amazing opportunities for your online business. We’re going to show you how to start running Amazon campaigns that get your product to appear in front of way more interested customers.

If you’re using Amazon as a platform to sell your products, then you might be struggling to get your products seen by the millions of active customers on the platform. If you advertise your products though, you could get them to the very top of Amazon search results - helping you win over more business from your competitors. We’re going to show you how to do this.

Follow our guide for everything you need to know about getting started with Amazon advertising to boost your sales.

What is Amazon Advertising?

Amazon advertising, previously called Amazon Marketing Services or AMS, follows the same basic idea as paid ads on Google. When you search on Amazon for a specific product, the top results will include sponsored posts. These are Amazon ads. You can notice them by “Ad” or “Sponsored” being included on the product listing.

Users can think of Amazon as a type of search engine for products. With this idea in mind, businesses can bid on specific keywords that relate to their products. This is basically the Amazon version of Adwords.

These sponsored product ads aim to get your product ranking at the top of a relevant search query based on the right keywords. This is important for increasing sales for your product listings. There are various types of ads Amazon offers. The main idea of Amazon’s advertising program is to get your product more exposure for the right keyword, to help more shoppers see your product.

Just like Google, Amazon has a specific system for ranking its products in search results pages. This includes prioritizing the best-selling products with a good amount of feedback relevant to the search query. This will get you more organic exposure on Amazon. However, if you have a brand new product and are trying to compete with brands and products that are already well established, then sponsored products could be the best solution to help you get to the top.

Amazon sponsored products

An example of “sponsored” products sitting at the top of an Amazon search query.

How Does Amazon Advertising Work?

Amazon sponsored product ads follow a pay-per-click (PPC) model. Unlike eBay’s pay-per-sale model, you pay for the ad when a user clicks on it. It doesn’t matter whether this click results in a sale or not.

It’s important to understand your advertising cost and the kind of ROI that you will get from this. Your ad spend needs to be worth it for your bottom line.

On average, the cost per click on Amazon is $0.81. If you’re comparing this to AdWords averages, then the CPC here can be considered pretty cost-effective.

Amazon ad spend offers great potential for your business too. This is because the users on Amazon have a very high intent of actually buying a product. Sponsored product ads tend to perform well on Amazon because the users are specifically looking for products to buy. There’s a better chance of your ads getting higher-quality traffic, or clicks, to your product compared to keyword-targeted ads on other platforms.


Benefits of Amazon Advertising

The ultimate goal of Amazon advertising is to sell more products. Campaigns exist to make more shoppers click on your product to boost your sales.

Choosing Amazon for advertising is an excellent idea, as this platform offers many unique advantages. We’ve outlined some of the key benefits to Amazon advertising below:

  • Amazon users have high commercial intent, so the ROI from your cost per click should be good.
  • Amazon ads help to simplify the sales cycle, making it easier to make sales in fewer stages.
  • Amazon’s advertising can help to boost brand awareness and associate your sponsored products with being some of the best within their niche.
  • Amazon advertising offers plenty of valuable data on the customer journey. You can gain a deeper insight into who your shoppers are and how what their shopping habits are like.
  • The data available also allows you to make smarter, data-driven decisions for your eCommerce marketing. This is based on real results from how your products on Amazon and your advertising performs.
  • Amazon ads enhance the visibility of your products online.
  • Running different search ads and sponsored products can help you to better understand the most efficient and cost-effective ways to acquire new customers.

With close to $386 billion of net sales last year, Amazon is easily the world’s biggest online retailer. If you’ve got eCommerce products on Amazon, then you need to make sure your products are standing out and getting enough of the right attention. Paid advertising is a great way to fast-track your sales and popularity on Amazon.


Understanding Self-Serve Ads vs Premium Ads

When you start setting up your Amazon advertising, you will be faced with the option of either self-serve ads or premium ads. There are the two main pillars of Amazon campaigns.

Self-serve ads are focused on including your sponsored product on the search results pages. Here is an example:

Amazon sponsored yoga matt products

Premium ads can be displayed across the web on other sites. These are similar to Google display ads, and they can appear on Amazon as banner and sidebar ads. Here is an example:

Yoga matt ad

Amazon offers loads of potential as an advertising platform. Your brand can use different types of ads in different ways to make sure more shoppers click on your product. Before getting started though, you will need to establish whether you will be running self-serve ads or premium ads.


Types of Amazon Ads

Amazon advertising includes a variety of different types of ads. This includes various ad placement and format options. We’ve listed your different options for ads below.


Sponsored Products

Amazon sponsored products are typical types of ads that reveal your sponsored product page on either search results pages or product detail pages. These types of pay-per-click ads are created for specific, individual products determined by keywords.

Watches sponsored products


Product Display Ads

Product display ads on Amazon are a little bit more advanced than sponsored products. These are also pay-per-click ads, but they don’t just advertise a specific sponsored product. Instead, product display ads try to either up-sell products or cross-sell products to Amazon customers.

It’s important to understand that product display ads aren’t just for retailers on Amazon. These ads can be used by businesses selling on other platforms too.

These ads can also appear in a variety of different places. This includes product detail pages, below search results, on customer review pages, and on top of the offer listing page. These display ads can even make their way into email marketing. You could display them in abandoned cart emails and other types of eCommerce emails.

Product display ad


Sponsored Brands

Sponsored brands follow a similar idea to sponsored products. However, instead of just focusing on targeting the ads toward a single product, sponsored brands can run ads on multiple products. These ads could send customers to your brand’s Amazon store, or specific products.

Sponsored brands are also targeted to specific keywords, and they also follow a PPC model. These ads can include up to three products. Each element of sponsored brand’s ads can be tested and customized.

Sponsored brands are are useful if you want to promote your business and what it offers instead of just focusing on a single product.


Stores

Amazon users can create their own multipage stores. These custom destinations are dedicated to specific brands, where you can promote your products. Amazon Stores are free to use, and they don’t require any sort of technical knowledge to create.

The North Face Amazon store This is an example of an Amazon store operated by the North Face.

Amazon Native Ads

Amazon native ads can include a variety of different ad types. The thing that sets these ads apart is that they are found on your business’s website instead of on Amazon. The goal of these ads is to direct users to your products on Amazon, instead of trying to promote your product to users who are already on Amazon.

Amazon native ads can be really useful when used correctly. The different types of ads available include search ads, custom ads, and recommendation ads.

Amazon native ad


Video Ads

Amazon video ads are slightly different, as they can be used by people who don’t necessarily sell products on Amazon. These ads can be placed on sites and devices that Amazon owns. This includes things like Fire TV and IMDb. Of course, video ads can also be placed on Amazon.com.

Video marketing offers huge opportunities for your brand, so these types of ads could offer you some great results. However, if you’re just looking to promote your products on Amazon and increase their visibility to the right customers, then creating video ads for Fire TV might not be the best approach.

Amazon video ad

Screenshot of a moving video ad on Amazon that includes audio.


How to Get Started With Amazon Advertising

Getting started with Amazon advertising is a pretty easy process. First, you will need to have a seller or vendor account which you’ll need to be signed in to.

Once you’re logged into seller central, go to the “Advertising” tab. Once here, you will be able to choose your campaign type. You can then follow the steps listed out to create your campaign. Here are the basic steps to take for different types of campaigns:

  • Sponsored Products: Choose the products you want to sponsor, decide between automatic or manual targeting, then decide how much you want to pay per click. Sponsored products are most common.
  • Sponsored Brands: Choose at least three products that you want to promote. Add your headline and logo, and decide on the keywords you will be targeting. Then you can decide how much you will want to spend.
  • Display Ads: First choose your audience. Then set your daily budget and bid, and choose the products you will promote. Now you can create an ad campaign.
  • Stores: Click the “Stores” tab instead of choosing a campaign. Now you can access various drag-and-drop tiles, as well as pre-built templates, to easily set up your store.

That’s all it takes to start to advertise on Amazon. However, each different campaign that you run will work differently and produce unique results. This is why it’s important to choose the most relevant campaign based on your marketing goals.

It’s also important to control your costs. You will need to set a maximum budget for the amount that you’re willing to spend. Most Amazon ads run on a cost-per-click basis, so you will need to choose how much you are willing to spend for the click. This needs to be done alongside careful keyword targeting.

Finally, you will need to keep an eye on your campaigns to see how they’re paying off. The only way to know if your advertising is working is to measure things like your impressions, clicks, click-through rates, and the amount of traffic that goes to your store. This all needs to be monitored alongside your advertising spend to make sure that your campaign is paying off. Amazon offers all of these insights to help you easily track and monitor the progress of your campaigns.

Follow this video to help you understand how to create your first Sponsored Products campaign.

How Much Does it Cost to Advertise on Amazon?

We’ve already established that Amazon advertising works on a pay-per-click basis. This means that the cost of your ads could vary. On Amazon, the cost-per-click generally ranges between $0.02 - $3. This all depends on the type of ad, the marketplace, and the product category.

If you run Amazon ads, you’re in control of the amount you spend on ads. This is determined by your ad budget which you put in place when setting up campaigns. Figuring out the price-per-click is done through a type of auction.

This works by each advertiser submitting a bid, which is the maximum they will pay for their campaigns. Quite simply, whoever bids the highest wins the highest ad position. They also end up paying the highest price. However, the maximum price paid is only ever $0.01 more than the previous bid.

For example, if the second-highest user bid is $2, and you bid $6, you will end up winning the highest ad position. You won’t end up paying $6 though, you will have to pay $2.01 instead.

So when figuring out how much Amazon advertising costs, it’s your budget and competitors that end up determining the price.



How to Optimize Your Amazon Ads

We’ve established that it’s pretty easy to set up Amazon sponsored ads. However, you need to make sure that your campaigns are doing the most for your brand.

When you create campaigns, there are a couple of decisions that you can make which influence your success. Here are some of the most important marketing tips to remember when creating campaigns on Amazon’s platform.


Carefully Structure Your Campaigns by Product Category

The best strategy to structure your advertising is to create separate advertising campaigns for your main product groups, and then have more specific keyword-targeted ad groups underneath each main campaign. This will help with targeting the right audience for each of your individual product pages, resulting in better advertising performance.


Include the Most Important Information in Your Ad Text

You don’t want to overload your ads with too much information because this could overwhelm your shoppers. However, you need to make sure you make the most important aspects of your products visible in your advertising campaigns.

Think about the unique selling points of your product, and which parts of it attract shoppers and boost sales. Make sure that you highlight all of these aspects in your ad. Shoppers should be able to look at your ad and understand your product completely.

Amazon toothbrush holder ad

This is how you can use your sponsored product to include all of the information that your buyers want to know.


Follow Your Competition

A good strategy is to bid on well-known brands and competitors that sell popular products. Targeting top-selling brands is a great way to get your business more exposure to shoppers interested in your product. Search for your product on Amazon, and find the best selling or most popular product listings based on which brands appear the most. For example, if you sell activewear, consider bidding on keywords like “Under Armour activewear”.

Amazon ad


Write Compelling Ad Copy

There are thousands of product pages on Amazon, so make sure that yours stands out. This can be achieved with unique, urgent ad copy. Try not to just write what all the other brands are writing in their product detail pages. Instead, try to write copy that pushes your product listings. Write about the benefits your product offers, highlight promotions, and make any kind of unique feature clearly visible.

Amazon sponsored product

Example of listing benefits in your product headline.


Experiment With Different Ad Formats

You have a choice of different types of ad campaigns that you can run, so try them all out and see which works best for your brand. Search ads might offer your business certain benefits, and display ads might offer other ones. Make sure that you carefully track your advertising cost, and returns related to the ads. This is important to understand which strategies help your brand to make the most sales, and which are not worth the advertising cost.

Amazon ads

Understand the Best Keywords

You need to be bidding on the right keywords to increase your visibility when people search on Amazon. The right keywords will boost your sales and help your search ads to become visible to the right customers.

Make sure you conduct proper keyword research using tools, such as Ahrefs or Ubersuggest, to target keywords that will add the most value to your campaigns. Being conservative with your match types is generally a good strategy. Advertisers must also pay attention to negative keywords.


Monitor Your Amazon Advertising Performance

The only way to improve and optimize your ads is to pay careful attention to how your ads are performing. You can take away insights from this to improve the way you advertise.

Carefully monitor your advertising cost, ROI, and sales during your promotions. Look at which keywords are most popular, which keywords make the most sales, and what types of campaigns are best for your business. The more you monitor your campaigns, the better you can enhance them for future performance.

Amazon advertising campaigns Managing and monitoring your Amazon campaigns can be done from a single dashboard (source).


Amazon Ad Metrics You Need to Know

We mentioned that you need to track your campaigns to see which strategies are working best for your business. In order to do this properly, you will need to know the most important metrics to follow. Here are the most relevant metrics to keep in mind when monitoring your Amazon campaigns:

  • Impressions: The number of times that your ad was visible to an Amazon user.
  • Clicks: The number of times an Amazon user chooses to click on your ad.
  • Click-Through Rate (CTR): A percentage that compares the number of impressions to the number of clicks. This is calculated by dividing clicks by impressions.
  • Cost-Per-Click (CPC): The average cost that you end up paying per click. This is your ad spend divided by the number of clicks.
  • Advertising Cost of Sales (ACoS): This is the ratio of your ad costs to your sales resulting from that ad. This is a unique Amazon metric, and it is essential for understanding how effective your ad is.
  • Conversions: The number of clicks that turned into sales. The more conversions you have the better.
  • Total Advertising Cost of Sales (TACoS): The ratio of your ad costs compared to your total number of sales. Compared to ACoS, this metric considers both organic sales as well as sales that resulted from ads. This helps to understand the efficiency of your ads, and how they’re working compared to your organic sales.

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Conclusion

Advertisers can get great success out of running campaigns on Amazon. In such a crowded and competitive marketplace, running campaigns based on the right keywords can help your product to stand out to the right customers. This can make a big difference to your sales.

We’ve covered everything your business needs to know to start running successful advertising campaigns on Amazon to boost its sales. We’ve shown you the different types of campaigns available, now it’s up to you to see which ones work best for your brand.


Done for You Amazon Advertising

Are you interested in running your own Amazon advertising campaigns, but don’t have the time or marketing experience to make it happen? At Wishpond, we offer Amazon advertising campaigns created just for your business.

Get in touch with us today to see how we can help you run successful campaigns that drive up your sales. Our team of marketing experts can create campaigns for you, giving you more time to focus on growing your business.


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Written by Tom

Tom is a marketing content writer at Wishpond. If he’s not creating content, you can find him playing with his dogs, reading a recipe book, or drinking strong coffee.