Amazon PPC Strategy: Advertising Strategies and Tips for Amazon Sellers

One of the most challenging aspects of launching a business on Amazon is properly navigating the complex world of Amazon Pay-Per-Click (PPC) advertising. With the correct strategies and tips, however, the ability to use Amazon PPC to reach and engage potential customers becomes easier. 

If you desire to achieve success on Amazon beginning in 2023 and moving forward, it is essential that you create a suitable Amazon PPC management strategy.

Using Amazon Pay-per-Click (PPC) advertising, brands, agencies, and third-party sellers can create ads based on the targeted keywords which will show up on Amazon’s search results page and their competitors’ product listings. This offers the right product to buyers who are ready to make a purchase at the purchase point, and then measure the ad’s success in terms of conversion. This proven marketing tactic is employed by three-quarters of all types and sizes of Amazon sellers.

In this article, we will explore different Amazon PPC strategies, from setting up campaigns to understanding terms and reaching target audiences, to help Amazon Sellers create an effective Amazon PPC strategy for their business.

We’ll thoroughly examine each kind of PPC advertisement and how to create them, as well as advice on techniques that Jungle Scout’s experienced Amazon sellers employ for their companies.

Amazon PPC: An Overview

Amazon has a pay-per-click (PPC) advertising service that it offers to third-party vendors. This program lets vendors create promotional campaigns and is paid for when someone clicks on the ads to view further information. It is necessary to comprehend Amazon’s key PPC indicators, which are outlined by Amazon.

✅ Advertising Cost of Sales (ACoS): In case you want to calculate the proportion of attributed sales spent on advertising, then you need to divide the amount spent promoting your product by the attributed sales. As an example, if you used $4 of advertising and it generated $20 in attributed sales, the Advertising Cost of Sales would be 20% (being $4/$20 = 0.20).

✅ Attributed Sales: It can take up to 48 hours for the sales data for the products advertised in your ads to appear in the ‘Yesterday’ date range. This means that the sales totals from the campaign will not be available in the ‘Today’ date range. To view the individual sales totals, please check the Campaign Performance report.

✅ Impressions: Once the number of times your advertisements were viewed has been established, it may take up to three days to delete incorrect clicks from your reports. Clicks from the last three days might be modified due to the elimination of invalid clicks.

Clicks: Once you are aware of how many times your ads were clicked, it could take up to 3 days to take away any unbelievable clicks from your data. Clicks from the last few days might be altered due to eliminating false impressions.

Why is PPC Essential for Amazon sellers?

As more and more people start shopping online and a majority have turned to Amazon, ecommerce businesses have great potential to experience success. However, with this comes more and more competitors all striving to gain the highest number of purchases. By 2023, having a successful pay-per-click campaign is an absolute necessity for businesses of any size that are using Amazon. Since there are an astounding amount of goods being advertised on Amazon, products become submerged in the mass.

Although your organic ranking (position of your product in a search engine listing) is vitally important, ads can help broaden the visibility of your product on the platform.

How to Develop an Amazon PPC Strategy?

Here are the fundamentals of creating an effective Amazon PPC strategy:

• Experiment: Try different PPC advertising strategies, both automated and manually selected keywords to find the best for your company. 
• Analyze: Utilize Jungle Scout’s Keyword Scout to inspect relevant and competitor product keywords. 
• Budget: Establish beginning daily budgets and bids that are 50-100% more than what Amazon proposes. 
• Duration: Give ad campaigns an appropriate amount of time, two weeks, before checking outcomes and adapting them. 
• Types of Campaign: Use outputs from automatic campaigns to select keywords for manual campaigns. Before changing or crossing out keywords from manual campaigns, ensure each keyword gets at least 10 clicks. 
• Monitor: Constantly observe ad reports, removing, including, and moving keywords when necessary.

How to Choose the Best Amazon PPC Ad for Your Business?

Amazon has many different forms of PPC that you can utilize with personalized targeting features. It’s suggested that you try all the available ads, with a focus on auto-targeting and manually targeted Sponsored Product ads as these are your best bet for finding the best keywords and phrases to use. Further, it is suggested that you think in terms of what you may get in return for every dollar spent, mainly if you have a limited budget, to maximize the return on advertising spend (RoAS).

RoAS = Total Ad Attributed Sales/total ad spend 

RoAS = 1/ACoS

Determining the best PPC strategy for your business to concentrate on can be tricky for SMEs. It is beneficial to experiment with different advertisements to see which gets the best results and fits the image of your brand. Once you have compiled the information you need, it could be a good idea to invest more in ads that function positively, while stopping the ones that are not successful.

Also Read: Amazon Pay-Per-Click | Everything You Need to Know

Different Types of Amazon PPC Ads and Targeting Practices

Out of the 79% of Amazon Small and Medium Business (SMB) sellers that advertise their goods on or off the Amazon platform, the following is the proportion of those who use Amazon’s Pay-per-click (PPC) advertising services:

• 77% use Sponsored Products ads
• 39% use Sponsored Brands ads
• 30% use Sponsored Display ads

Let’s go over the various types of Amazon PPC advertisements used by third-party vendors, from most to least popular.

• Sponsored Products ads
• Sponsored Brand ads
• Sponsored Display ads

Sponsored Products Ads

When utilizing Sponsored Products advertising, 66% of third-party providers utilize the most frequent form of Amazon PPC campaign – ads that show up in search outcomes and item list pages, often appearing comparable to non-paid postings. Automatic and manual targeting are the two keyword strategies available to sellers; let’s explore what separates them.

✓ Automatic Targeting

The strategy involves targeting keywords that Amazon’s calculation judges to be associated with your product listing. As time passes, Amazon uses data gathered from shoppers’ clicks and orders, then adjusts the ads to give the best matches to your listing and maximize conversions.

Sellers have four different keyword match options when using automatic targeting.

• Ads with close matches: These will appear when a user types terms that are closely related to what you’re advertising. 
• Ads with loose matches: These will be displayed when a person searches with words that are related to your product in a less direct manner. 
• Substitutions: These target customers who are considering similar goods which are made by a different organization (for example, a Cuisinart blender rather than a KitchenAid blender). 
• Complements: This targets shoppers who are viewing details about products that complement yours (for example, paint brushes with a paint set). 
• Automatic ads are the simplest ones from a seller’s standpoint yet offer fewer optimization options compared to other types of advertisement.

✓ Manual Targeting

Selecting keywords and phrases to bid on manually requires careful attention. These ads will only show up if the search terms used by shoppers match exactly with the words you have hand-picked. As this method requires a lot of personal time and effort, it is necessary to keep track of costs and adjust if needed. Taking this extra step typically yields sharper campaigns with lower overall spending.

Sponsored Brands Ads

Previously referred to as ‘headline search ads’, Sponsored Brands let traders wind up creating more attention around multiple products at the same time and bring shoppers’ eyeballs to visuals more marvelous than what Sponsored Products offer. With Sponsored Brands, business holders can pick from three formats that may appear either on the top of Amazon lookup engine outcomes as banner labels or even lower on the page as a video. Product collection and store spotlight usually have the trademark logo, interesting phrase, and 2 or more products whereas the video format contains a 15-30 second lengthy video capturing a particular product. When clicked, these advertisements guide the client to an individualized destination page or the brand name’s Amazon Storefront.

Also Watch: TOP Amazon PPC Ad Strategies | Amazon Advertising Hacks – Watch Video

Sponsored Display ads

Sponsored Display PPC ads, which allow brand owners to retarget customers who have visited their product pages, have yet to gain traction amongst third-party Amazon retailers (only 25% adoption is seen). In contrast to Sponsored Brands and Products, the adverts can run on other affiliate platforms, such as Google, Facebook, Netflix, and smartphone apps. However, you must have a registered company to be able to run ads via the Display feature.

• Now, you need to go below the graphs and then tap on the “Create campaign” option
• Then, you need to click on the “Continue” button under Sponsored Products.
• After that, fill in the info on the Settings category of the Create campaign page.

✓ Campaign name

Select a label for your campaign. It can be any expression that can help you recall why the campaign was made. We advise you to name your campaign after the product and then include the Ad Group name with the kind of campaign and product variations (if any).

✓ Date

Choose the beginning and terminating dates for your campaign. If you would like your campaign to last forever, leave the expiration date box blank.

✓ Daily budget

Amazon lets you determine the maximum cost of advertising that you want to spend each day. If the amount you spend on advertising is lower than expected at the end of the day, you can take the remaining money and use it to increase your advertising budget by 10% in the same month.

Note: It is suggested to set your daily budget to at least $50 when you begin. Generally, each click (pay per click) will cost between $0.50 and $1.50. If you decide to have a budget of $10, it will be used up quickly.

The amount spent on your ads will be taken out of the balance in your account, and if there do not exist sufficient funds to complete the purchase, Amazon will bill your initial sign-up credit card.

✓ Targeting

You need to select “automatic” for an automatic-targeting sponsored product ad.

Choose your Campaign Bidding Strategy

There are three types of campaign-bidding strategies for the automatic targeting of Sponsored Products ads.

✓ Dynamic bids – down only

Amazon automatically reduces your bids when it is unlikely that a sale will be made, avoiding displaying your advertisement on irrelevant search results.

✓ Dynamic bids – up and down

If your sponsored product has an increased likelihood of being successful, Amazon will raise the cost of your bid by 10%, in addition to any reductions that might have been made for a ‘down only’ bid.

✓ Fixed bids

Your bid will remain the same unless you opt to modify it, and Amazon will not alter it.

Tip: When beginning, it is suggested to select ‘Dynamic bids – up and down’ to increase your odds of making a sale on Amazon.

Create an ad group

On the same page, you used to create a campaign, fill in the following details.

✓ Ad group name

The title of your ad group reflects items funded with the same funds and bids. It does not matter what it is, however, you may want to name it after the kind of campaign (manually or automatically managed) and its specific details for the best means of remembrance.

Naming example: 

• Campaign name: bamboo skewers
• Ad group: automatic – 50-pack
• Products

Choose the items that you want to promote. We suggest picking only one item per ad group when beginning.

Set your bids

There are two methods for configuring bids for Sponsored Products ads using automatic targeting.

✓ Set default bid

If you want to make things easier for yourself, you can set a default bid for all kinds of matches on Amazon. The company recommends an initial bid of $0.75, irrespective of the product. Nevertheless, it will be beneficial to bid more aggressively at the start (maybe up to $1.50 to $2.00) to encourage early sales.

✓ Set bids by targeting group

For more precise automatic targeting, you can configure bids by segmenting groups and allocating distinct amounts for each strategy.

Remember, there are four types of automatic targeting bid strategies.

• Close match: This presents your sponsored product advertisement to those searching for terms having similar meanings to your products. For instance, if you have a “black, 48-inch broadsword”, it would show up in searches for “black broadsword” or “48-inch broadsword”. 
• Loose match: This presents your sponsored product advertisement to those searching for terms having a broad relation to your products. For instance, if you have a “black, 48-inch broadsword”, it would show up in searches for “sword” or “medieval weapon.” 
• Substitutes: This displays your sponsored product advertisement to people browsing through product pages similar to yours. For example, if you possess a “black, 48-inch broadsword”, it would show up on product pages for “silver, 48-inch broadsword” or “black, 52-inch broadsword.”
• Complements: This demonstrates your sponsored product advertisement to customers who look at detailed pages of items that supplement yours. For instance, if your product is a “black, 48-inch broadsword”, your product would show up on details pages for “large, steel shield” or “leather sheath for a sword.”

You can assign a variety of values to each bid tactic. Amazon gives advice on these bids depending on how much other vendors are bidding.

✓ Optional: Include negative targeting keywords

If you want to prevent your product from appearing when particular keywords are used, you can add those words to the automatic-targeting list. However, it is recommended that you leave the list blank as you are getting started.

Subsequently, we will demonstrate how to incorporate underperforming and successful terms into this compilation.

✓ Launch campaign

Make sure you verify every detail before you click the yellow-colored “Launch campaign” tab found at the underside of this webpage. You can even preserve the draft if you need to come back to it in the future. The debut of your advertisement on Amazon may take anywhere between thirty minutes and one hour.

Steps To Optimize Automatic Targeting Sponsored Products Ads

After your automatic-targeting Sponsored Products ad has been active for at least one week, you should analyze the information and make any needed modifications.

✓ Return to your automatic campaign

Go back to the Seller Central page and click on the Advertising tab. Scroll under the graphs until you find the advertising campaign you want to make changes to. Select the ad group you want to optimize.

✓ Review the data

Within your advertising group, you have data available to view immediately that can give you an idea of how your automatic-targeted sponsored product ad is doing.

• Spend: This is the amount you’ve spent on advertising for a specific campaign within the given period (for example, the last 30 days).
• Earnings: This is the total revenue you’ve received for a product that is in direct relation to the promoted product advertisement campaign within the specified date range. This value does not include income from organic sources or from other advertisement campaigns for the product.
• Advertising Cost of Sales (ACoS): This ratio is determined by dividing your advertising expenses by your direct sales for the campaign.
• Impressions: This is the number of times clients saw your advertisement in the selected span of time.
• Additional metric: You can add other measures to the chart such as Clicks, Cost-per-click (CPC), Click Through rate (CTR), and Orders.
• Product-by-product information: All products included in the ad group are listed at the bottom of the page. Each product has its own collection of columns displaying metrics for the given period.
• Columns: You can customize your item lines by adding additional columns, such as Impressions, Clicks, Clickthrough rate (CTR), Return on Ad Spend (RoAS), and Cost-per-click (CPC). You can also reset the columns to the original settings.
• Date range: It is possible to look at data from different time periods by changing the dates. 
• Export: To save the data for the ad group, you can use the export function to create a downloadable CSV.
• Additional options: To the top of the graph, you will find a list of various options.
• Targeting: With automatic targeting, there are no adjustments that can be made, but you can download a report of the customer search terms and keywords that led to a sale.
• Negative targeting: Negative keywords that you do not want Amazon to target appear on this list. You may add or remove negative keywords as required.
• Search results: The relevant keywords that Amazon has targeted for your ad and the ones customers have clicked on are presented here. You can customize them just like the other graphical displays and lists. 
• Advertising group parameters: In this section, you can alter the name assigned to the group and modify your default bids. 
• History: This will show you any changes made to the designated campaign over a certain period. 
• Advert Reports: To see a comprehensive list of search terms and phrases that customers have clicked on within your campaign, you should generate an ad report. This process takes about 30 minutes. Once the report has been put together it is found under this tab.

✓ Create an advertising report

Once you have analyzed the comprehensive data for your automatic-targeting ads, produce an advertising analysis. This evaluation generates an Excel file containing data from all your advertising activities. To produce an analysis, go to the Reports tab in Seller Central and select “Advertising Reports”.

• Select “Sponsored Products” in the menu.
• Go to the “Search Term” report type.
• Choose the “Summary” option.
• Generate a report for the period of the last month or whatever period is related to the campaign.
• Name the campaign.
• Schedule to deliver the campaign at the most convenient time. 
• Press the “Run” report button in yellow.
• Go to the “History” section.
• Download and open the report.

✓ Review your advertising report

The advertising report contains a lot of vital information concerning the keywords and search terms that Amazon customers employed in regard to the Sponsored Products ads with your automatic targeting.

Checkout out the following columns:

• Keyword entered by a customer of Amazon to locate a product.
• Overall advertising cost as a proportion of sales (ACoS). The ACoS is the percentage of total sales resulting from the amount invested in advertising associated with the keyword. 
• The conversion rate in a 7-day period. The conversion rate is the number of sales made over a period of seven days divided by the number of times that the sponsored product ad was viewed during that same period.

✓ Create a list of poor-performing keywords

Examine the keywords in the search term report that are producing unsatisfactory results. It is wise to pick keywords that have been clicked on more than 10 times and have either a high Advertising Cost-of-Sale (ACoS) or a low 7-day conversion rate. Determine your acceptable ACoS by examining the profit after fees and expenditures for the item have been excluded.

If the ratio of your Advertising Cost of Sale (ACoS) is lower than the gain margin, then it can be regarded as a successful one. However, in the event that the ACoS is more than the margin of profit, you may wish to add that keyword to the list of negative-targeting words for the product advert group with automated targeting. When it comes to items priced between $18 and $25, we desire to achieve a conversion rate of about 10%. For costlier items, it would be advisable to go for a conversion rate that is lower.

Once you have identified the terms which have resulted in low performance, create a list and add them to the negative-targeted keywords section of the active group. By doing this, your product’s automatic-targeted ad will not be displayed on the Amazon search results page when those keywords are searched.

✓ Create a list of high-performing keywords

Go through the same report and find keywords with a minimum of ten clicks that meet your goals of limiting ACoS and conversion rate. To take advantage of the high-performing words, integrate them into your current campaigns related to the product and as negative keywords to keep your low-performing automatic campaigns delegated away.

✓ Continue to run your automatic-targeting sponsored ad

Once you have optimized your automatic-targeting sponsored ad, you should keep running it for a further seven days. After the two weeks have come to an end, you should repeat the same optimization process again.

FAQs

Q: Why use Amazon PPC?

Amazon Pay-Per-Click is an effective way to increase your exposure on Amazon, attract more viewers to your product listings, and thus drive more sales. It’s a fantastic method to contact new buyers and rival other merchants.

Q: How to create  an Amazon PPC campaign?

For launching an Amazon PPC campaign, log in to your merchant account then navigate to the Advertising tab. Decide which type of campaign you wish to begin, specify the targeting preferences, pick your keywords, and decide on your budget with the bidding approach.

Q: What is the best bidding practice for Amazon PPC?

Selecting the optimal approach for Amazon Pay-Per-Click can be based on one’s ambitions and expenses. Whereas some merchants decide to bid intensely so as to gain more click-throughs and exposures, others settle for less competitive bids so as to get the most out of their outlay. Testing different approaches and adapting according to results is very important.

Q: How to optimize Amazon PPC campaigns?

For the most effective Amazon PPC results, it is critical to monitor the performance of your campaigns and update your targeting, keywords, and bidding when applicable. Keep an eye on your ad costs and change your budget to maximize the return on your investment. Additionally, take advantage of Amazon’s reporting tools to detect areas that can be improved.

Q: How to improve my Amazon PPC results?

For better outcomes on Amazon PPC, make sure your ads are compelling, pertinent, and appeals to the audience. Optimize your product listings to make them attractive and easy to access. Lastly, frequently check your campaigns to make any necessary tweaks and get the greatest return on investment.

Conclusion

The success of an Amazon PPC strategy depends on multiple variables. Understanding the basics of Amazon PPC, like bidding strategies and keyword research tools, can help identify profitable keywords and target audiences. Learning the nuances of structuring successful campaigns and managing budgets efficiently is also key. Ultimately, an effective Amazon PPC strategy will require continued testing, optimization, and a deep understanding of the Amazon marketplace. With the right understanding of the Amazon PPC ecosystem, sellers can keep up with the latest trends and ensure their PPC strategies stay competitive and profitable. 

This Amazon PPC guide contains a lot of helpful information which you should save for further reference. Are you aiming to achieve success with Amazon’s keyword research features and product launches? Jungle Scout provides great data and an array of tools that can help you get ahead. We would like to know if you have any helpful tips when it comes to Amazon PPC – feel free to let us know your thoughts in the comments!