The interesting story of Amazon PPC started in 2012. Back in the days, Amazon PPC only allowed 1 ad type and 1 targeting option. This was sponsored product with automatic target options. There was no debate on which Amazon ad types to use. The limited targeted options mean that Amazon sellers could more or less create/set and forget a PPC campaign. Therefore, it does not matter where in the life cycle of your product, you will run this campaign regardless.
Well, that was 8 years ago, lots of things have changed since. There are a lot more Amazon PPC ad types (more on that later), but also more targeting options as well. The proliferation of options can create confusion for inexperienced Amazon PPC users.
There are 4 major Amazon Ad types, they are: Sponsored Products, Sponsored Brands, Sponsored Display, and Amazon DSP
In this article, we will discuss what are these ad types. We will also advise you on what is the best time and place to use these different options.
Sponsored Products are ads that show up on the Amazon search result page. If you see the first 2-3 results with the “sponsored” tag on the search page and also in the middle of the product listing then it is sponsored product listing.
Out of the Amazon ad types, this one allows you to use both keywords and product targeting options. It also allows for both automatic and manual targeting types.
Automatic targeting lets Amazon advertising algorithms decide on what keywords and product to target on. It also means Amazon will decide on what placement to target, and so on. Therefore, it is important that your Amazon product listing is highly optimized. Make sure your main keywords are in the first part of the title.
Manual targeting allows for the aforementioned keywords and product targeting options. The manual targeting option allows the most control as you specify the keyword/ASIN and also the corresponding bid.
When should you use Sponsored Products?
The first campaign you should always set up right after your product is in stock. Make sure your listing is optimized and run automatic Sponsored Products right away. There a few reasons why you want to run this campaign right away:
- If the results of the automatic campaign are good, then your page is optimized correctly
- It is relatively cheap to run versus other targeting and ad types (Large ads inventory and targeting freedom)
- Learn the exact keywords/asin that has resulted in a conversion/orders (more confidence in your manual campaigns)
If your campaign doesn’t result in any significant conversion/orders after running your automatic campaigns after 2-3 weeks, we suggest you go back to your keyword research and refine your product listing. But once you do get a significant number of conversions, you can create a manual Sponsored Product campaign.
Amazon Sponsored Brands Ad, formerly Headline Search Ads,) are ads that appear both in the search results, product pages (via product attributed targeting), and other places such as the checkout page. These ads normally show up as long rectangular banners in both horizontal and vertical formats.
Another thing to note is that these banners allow for up to 3 different product images under your brand. You can easily advertise the product of different variations and complementary products all in the same ad. By clicking on these ads, you will be either taken directly to the product detail page (for 3 or more products), custom landing page, or your brand storefront (more on that later). Relative to the other Amazon advertising product types (Sponsored Products/Sponsored Display), you get much more creative control.
With Sponsored Brands you get 3 Ad Format types. There are Product Collection, Store Spotlight, and Video. On top of that, you get the option of keywords and product targeting option as well.
Because of the relatively low inventory compare to Sponsored Products, Sponsored Brand ads on average runs on a higher CPC (cost per click). We advise you to run any Sponsored Brands ads after your Sponsored Products campaign is matured.
Also, I would not allocate more than 40% of the campaign budget given to Sponsored Brand campaigns. The reason being is using these campaigns will affect your ACoS, since the main objective of Sponsored Brands is brand building, the ROI of these ad forms will be lower than Sponsored Products.
This ad type appears on the Amazon product listing page. It is a small rectangular or square banner that appears under the listing bullet points. The banner shows the main product image of the ASIN you are advertising for.
There are two types of targeting options, 1) Views remarketing 2) Product targeting. The views remarketing is more automatic, while the product targeting is manual and requires you to give the list of ASIN/Bid information into the campaign.
Before you have created any Sponsored Display campaigns, you should already have some data as to what ASIN has already been converted. This is based on data collected on the Sponsored Product automatic campaign created earlier. This will give you the starting point to create your Sponsored Display product targeting campaign.
For the view remarketing campaign I would start running this campaign type last. The reason being, Amazon requires significant traffic for them to retarget your audience who have visited your product and have not purchased it.
Why Sponsored Brands before Sponsored Display?
If possible we recommend running sponsored brands before sponsored display, because as of writing (Feb 18, 2021), Sponsored Display still does not support bulk operations. What are bulk operations? Bulk operations allow you to control and change multiple bids in Amazon PPC using a CSV file, it allows the advertiser to have much better bid/spend control as they scale up. Since Sponsored Display doesn’t support this, it’s much harder to scale up these ads. We recommended that you run these ads last. Another way you can manage sponsored display bids is by using an Amazon PPC automation software, which can make automatic bid changes to your Sponsored Display campaigns daily.
A Quick Summary
- First Sponsored Products campaign (Automatic) – run for 2-3 weeks to gather data
- Second Sponsored Products campaign (Manual) – after you get relevant data from the auto campaigns, the budget depends on the # of keywords you are targeting
- Sponsored Brands campaigns – create headline ads first, then move on to Sponsored Brands video ads
- Sponsored Display campaigns – Using the data from Sponsored Products (auto)
Lastly, I will dive into Amazon DSP (demand-side platform), Amazon DSP enable the advertiser (sellers) to programmatically buy display & video ad placement off the Amazon retail platform. DSP can reach an audience in the following Amazon own media properties and partners:
- Amazon website
- Fire TV
- Freedive (IMDb Streaming)
- Published Partners
- Third-Party Exchanges
For example, a customer goes to Amazon and search for a product but did not purchase The customer then goes to IMDB, sees video ads of the same product he was browsing for then goes back to Amazon to make the purchase. What I described was the successful use case for Amazon DSP.
Another thing to add is that DSP offers a lot less control compare to the Sponsored ad types, since it is 100% programmatic bidding, not self-service, and priced using CPM (Cost per mile) instead of CPC (Cost per click). The average conversion can get very expensive, but the potential audience can be massive. Another important thing to note! Sellers commit $3000 a month to start Amazon DSP. This makes this the very last Amazon advertising ad type you want to go with.
You are a good candidate for Amazon DSP if:
- You have sales of at least 50K USD a month, with net profit to at least cover the 3K commitment for 2 months
- Your product is selling for at least $30 USD, hard to make the numbers work if your AOV is low
- Your objective is to grow your awareness brand and potential audience
- You are not optimizing for profits
- Understand that it takes a while for the Amazon DSP algorithm to optimize, result not as immediate as say Sponsored Products.
With the proliferation of Amazon PPC options, it is important for advertiser/sellers to know what exactly each Sponsored Ad type does, how does it target, and where the ad is placed. You need to make sure that you are using the right ad type for the right situation and product life cycle. For example, you will not need to use a hammer for a screw head as you will not be using Sponsored Brands campaigns if your objective is to make sales. Our suggestion is to think and do some careful analysis on each Amazon ad type and plan out carefully on when and how to use these ad types.
About the Author
Rick Wong is a veteran Amazon seller who is into all things Amazon FBA. Having sold his Amazon business, Rick writes and talks about this topic to share his passion for Amazon FBA business building. A data geek at heart, he is currently the Co-Founder of SellerMetrics, a software tool that helps Amazon sellers automate the tedious and manual work of Amazon PPC Optimization. Our tool has been knowing to bring down ad spend and increase sales at the same time, average user can expect a 25% increase in ROI immediately after use, sign up for our free trial to find out.
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