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Amazon Advertising Guide

If not the top retailer, Amazon is one of the top retailers across the globe. Because of the sheer amount of traffic, clicks, and people that visit Amazon every day, advertising on Amazon is a sure fire way to generate traffic to your website and products. If you have the opportunity to advertise on Amazon, you absolutely should, as you will generate more income in sales than you will in the cost of the advertisements.

There are different types of advertising you can take advantage of on Amazon like self-serve ads or premium ads, and both could be beneficial to you. 

Amazon Marketing Services (AMS) is the basic backbone of advertising on Amazon, and we will break down that for you. AMS is also often referred to as “Amazon Advertising” and you will see both terms referenced in this article.

Read on below, and IO Scout's guide will help you determine what type of Amazon advertising is best for you, if you should consider video advertising, and how to best optimize your Amazon advertisements. You also might want to consider using our personal assistant who is specifically tailored to help you with any questions you have about any Amazon product or service.

What is Amazon Advertising?

You can buy almost anything you need on Amazon and have it shipped to your front door, and many times it will be delivered within 24 hours. The services and products Amazon offers compare to no other retailed worldwide. Whether you are buying dog food or toilet paper, Amazon has it all. You can also subscribe and save, as a buyer, meaning many people just put shipments on repeat. As a seller, those are your golden ticket – reliable, repeat sales! Advertising can help you get there.

Since Amazon has so many users (hundreds of millions of people use Amazon), it makes sense to advertise on Amazon. While Google advertising can help you get your webpage traffic, Amazon advertising can be tailored specific to your product, and with the right ads you can get your products to the top of search pages on Amazon.

The main goal of advertising on Amazon is to get your product on the top of search results. When someone searches for toilet paper, you want your particular toilet paper to come up at the top of the page. With Amazon advertising, you can make this happen. By advertising on Amazon, you will create a “sponsored post,” meaning your product will appear above others on the search menu.

Most people do not scroll too far when shopping. Buying habits for many people look like this:

  • People buy one of the first products that catches their eye during a search. 
  • People search on lowest price or top ranked, and buy the product on the top of the list.

Therefore, it is paramount that you get your product on the first page of search results.

Why Amazon Advertising

Since Amazon is the largest retailer, you want to get your product on the top of the search results on Amazon. That is going to give you the most chances for success with your seller’s business on Amazon. Why pay to advertise on a website that does not get as much traffic or as many customers as Amazon?

Amazon is the cream of the crop. While you might pay more to advertise with Amazon than somewhere else, you are also going to likely get more customers and sell more products, making this a win-win scenario for you. 

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Should I Advertise on Amazon?

With over 80 million Amazon Prime subscribers, and over 300 million shoppers, there is no better place to sell your product, or advertise your product, than on Amazon. The question isn’t “Should I advertise on Amazon” it’s “what kind of advertising should I use on Amazon?”

There are a few reasons why it is a no-brainer to advertise on Amazon:

  1. You will most likely see your product sales soar, which will increase your profit margins. 
  2. Customers who never heard of your product will find out about it, and purchase it.
  3. You can build long-term relationships with customers, having them come back time and time again. Consumers that make recurring purchases are the best type of customer as you can rely on that income.
  4. Some customers buy items on “subscribe and save.” This means that every few weeks or months, they want the same product shipped to their home. This works for things like dog food and toilet paper, which are generally consumed at the same rate. Advertising on Amazon gets your product in the eyes of consumers shopping like this. If you can get consumers to buy your products as a subscription, you will have a long-term, reliable stream of income.

If you have questions about what type of advertising to do, we will outline them below, or you can reach out to our personal assistant at any time. The personal assistant is a 24/7 chat feature, in which we can help you decide how much to spend on advertising, what kind of advertising to use, and answer just about any other Amazon question you have.

Amazon Advertising Costs

As a general rule, plan to spend less than 50 cents for each user that clicks on your product because of the ad. While you might think that can add up to be expensive over time, in reality, it is going to generate a lot more revenue for you. It also depends on how much your product is selling for. 50 cents is less of a percentage of a $200 item than it is for a $2.00 item. 

Consider how much your product sells for before launching into advertising. At the price per click is basically the same no matter how much you are selling the items for. You might not get quite as much bang for your buck if you are advertising for a $1 pencil versus a computer.

Consider – would you prefer to have more sales at a reliable pace even if you do not profit as much, or less reliable sales that you have to chase down even though the profit margins might be higher?

Remember, 100 sales at $5 will generate more income than 0 sales at $10. Always opt for the option that is going to generate a high amount of sales, even if it means you sacrifice a little of the profit off the top. 

Self-Serve Ads vs. Premium Ads

You will have two different option for ads, and both are worth considering. Self-serve ads are not too much different than a Google search ad, in that it will display on the page of search results. This can be key, as many consumers shop right from the first page of search results that they get.

On the other hand, a premium ad is more like a display ad that is a visual banner on a page. Premium ads can also be useful because they will show up on more websites than just Amazon. If you want eye popping graphics to lure consumers to your product, this could be the way to go. 

Consider your goals – If you are looking for ads to show up on a search result page, then self-serve is the way to go. If you are looking for something more visual, to show up on a banner or on multiple websites, go the extra mile and pay for premium ads.

Getting Started with Amazon Ads

There are a few very simple steps to take to get started with advertising your product or brand on Amazon:

  • Log in to your Amazon account, whether it be Seller Central or Vendor Central
  • If you do not have either of those accounts, you will need to create one
  • Sign up for the ad campaign of your choice
  • Keep track of your ads and change your advertisements any time you want to, or you can even cancel them if you need to
  • Use the available metrics to monitor the success of your advertisements

Remember, if you have any more questions about getting started, our personal assistant is always here to help answer any of your Amazon questions, they do not have to be specifically related to advertisements.

Types of Amazon Ads

There are a few different types of Amazon advertisements that can help you. Consider what your needs are, and make a choice. Banner ads look nice and draw the eye to your webpage, but you might also want to consider ads that drive sales and increase clicks to your product. 

Here is a look at some of the ways you can use Amazon advertisements to promote your products or brand.

Amazon Sponsored Product Ads

This is arguably the best way to get your product in front of the eyes of the consumer. Sponsored product always show up at the top of the Amazon search results page, meaning the products are the first ones that consumers see when they are searching. Having an Amazon sponsored product is a surefire way to increase sales, revenues, and profit margins.

Keywords are important here, and these ads are targeted based on the keywords the consumer is shopping for. As the advertiser, you can choose from exact keyword matches or something broader, depending on your target. 

Do you want to have an exact match, like someone looking for a champagne flute must search for “champagne flute?” Or, perhaps a looser match would be better and you can go after consumers searching for glassware, champagne, wine glasses, etc. This could be different based on different products, but think hard about what you want people to search for in order to find your products.

The nice thing about this type of ad is that you have full control over it. You as the advertiser will set a daily budget and decide on how long you want the ad to run for. You can pause the advertisement at any time as long as it has run for at least a day. 

Amazon Sponsored Brands Ads

You can use a sponsored brand ad to target customers as they are shopping, which can help make them aware of your product and brand. Your brand logo will serve to advertise your whole brand, not just one particular product. 

Clicking on your logo will take a customer to your entire store’s page. If you are selling multiple products under one brand, an Amazon sponsored brand ad could be a great way at generating more traffic to your entire brand, not just a product. Think of it this way, instead of having someone buy a potato peeler for their kitchen, they could end up buying all of their kitchen utensils from your brand page, generating more sales and income for you.

Think about Brand examples:

  • Coca Cola – you might want people to buy your cola product, but if you brand all of your soda under the Coca Cola brand, you will attract more interest to all of your products, not just cola
  • Johnson and Johnson – you might be selling Band-Aids, but branding under the bigger umbrella lets you generate traffic for all your other products like baby powder and shampoo

Amazon Sponsored Display Ads

This feature is for vendors and sellers who have a registered brand, so that they can create display ads that will work either on or off Amazon. These ads would show up in apps or websites that are included in the vast Amazon Ad Network. This could be a great way to get exposure, and generate traffic from other popular web platforms like IMDB and other partner websites.

While some ads are only available to vendors, these Display Ads can also be used by sellers, allowing sellers to use Amazon’s Ad Network to target consumers with just a couple of mouse clicks. This can help generate traffic to sellers’ products. 

These ads are based on clicks, so any other impressions are free. There are a few things to know about Display Ads:

  • Targeting allows you to show your ad to potential customers solely based on how customers historically have shopped, so consumers might see your product when they would not have without an ad.
  • Your ad will also go onto your competitor’s product page, which can help grab consumers from competitors. The buyer will actually see your ad right before he clicks “add to cart” on a competitor’s product. The ad will also go on your own page. 

Amazon Video Ads

Who doesn’t get sucked into the vortex that is YouTube from time to time? Videos have a way of capturing our attention like nothing else, and you can take advantage of a video ad to give customers quick insight into your product in a way that a regular ad cannot do.

Video ads allow you to reach a whole new audience, as you can advertise on streaming platforms, on IMDB, or even on connected TVs. Amazon ads have a few interesting features:

  • Target audiences that buy your brands – you can target where your ads are placed, so you are maximizing viewership 
  • Target audiences that do not buy your brands – this may seem like it won’t be fruitful, but find out why they are not buying your brands. You can target them and prove why your product might be better than another one that they are purchasing regularly
  • Use detailed metrics to target the right groups of buyers
  • Use video ads to compliment your existing Amazon display Ads

Video ads should be considered an entirely separate option than other advertising on Amazon, as it lets you target groups of people who do most of their online shopping and research through videos, not websites.

Amazon DSP Display Ads

Demand Side Platform, DSP, lets you reach audiences on the internet on Amazon websites and apps, but also through companies that are publishing partners with Amazon, and even some third-parties as well. There are many reasons to use DSP display ads:

  • Target hard to reach audiences – these ads can reach exclusive audiences
  • Attract audiences from other major platforms like IMDB
  • Use metrics to strategize your advertising, and have the research in hand to know what groups of consumers you should go after with your ads

Optimize Your Amazon Ads Tips

Here are the top 12 tips on how to best optimize all of your advertisements on Amazon:

Focus on Product categories

You will want to create a targeted ad campaign based on the category your product is in. Use Adwords to target products and consumers, and create a different campaign for each different type of product that you are selling. These Adwords can be tailored for products, brands, websites, and consumers.

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Creativity and Humor are important

Remember, you are appealing to people, not robots. You should tailor your advertisements accordingly. While keywords and algorithms might ultimately get a consumer to your product’s page, consumers are more likely to buy your product if they are drawn to it. Put something unique in your product description that appeals to the human behind the purchase. 

Be specific

Make sure your description tells the consumers what they need to know. If you are selling clothing, what color, what size, what material is made out of? If it is something that holds liquid – how many ounces, hot or cold, etc. Do not leave the customer guessing – more information is better. A customer should easily be able to get all relevant information about your product without needing to wade too deep into the product description.

Bid on Different Keywords

When setting up your ads, do not forget that it is ok to go after the keywords of your competitors. If you are selling a smartphone, you can put “IPhone” in your keyword, as you will end up getting consumers looking at your competitors’ products to come to your product page. This can be a way to get ahead of your competition and grab some of their customers.

Use multiple Ad formats

Do not pigeon-hole yourself into just one type of ad. Yes, more ads might cost more money, but they also should get your more customers, and you will sell more products, thus negating the extra expense of additional ads. Consider Display Ads, video ads, sponsored product ads, and more. The more advertisements, the more consumer traffic will go to your product webpage, and the more likely sales and revenue are to increase.

Be aware of matching keywords

Using negative keywords can help make sure you are targeting the right customers. You are paying for ads each time someone clicks on your product. So, you do not want to attract a customer who is shopping for a champagne flute, when you are selling the musical instrument type of flute. 

When choosing how to advertise, think about what you would shop for if you were looking for your product. You can also research through metrics to find out what has driven previous customers to your product page, and you can tailor your advertisements off of those metrics and keywords. 

Target other platforms

There are many major websites that partner with Amazon. IMDB is a world famous resource for people looking for information on any movie or TV show ever produced. You can target your Amazon ads to work on those platforms, and bring customers to your Amazon product page that might not have ever even shopped on Amazon. 

Use Video Ads

Video ads can be a great way to reach out to the younger generation who are used to getting all of their information from video and streaming services. Do not limit yourself to just advertising on Amazon’s search pages. Video ads can go after a whole different generation of consumers, and attract a market of people that have never seen your products before. 

Spend the Money

While it might seem like you are wasting money, as you are investing money possibly before you even make a sale, it is absolutely worth it to advertise with Amazon. Putting an ad on Amazon is like putting an ad in Times Square, NY. Amazon gets hundreds of millions of shoppers. People will see your ad and buy your product, and they might not ever see your product without an ad pointing them to your product page.

Mimic the competition

Do you see ads for other products like yours? What are they like? Do not be afraid to take ideas and concepts from other ads that you think would work for your product – that’s just smart business. 

“Imitation is the highest form of flattery,” – if you have competitors that have great products, you are not stealing their products. But, maybe they have subpar products and a great advertising strategy. There is nothing wrong with using similar keywords and trying to steer some of that traffic to your product and your brand. 

 Advertise on Social Media

You can use Amazon advertising to promote your products on social media, which is another great way to attract customers, especially the younger generation who can’t go to the bathroom without playing on their IPhone. 

Like a video ad, some consumers live and breathe on social media. If you can get your advertisement on those platforms, you are more likely to attract those consumers that spend hours a day on those platforms.

Change your ads

Do not be afraid to mix up your advertising after a couple weeks or a month. Different ads work at different times of year. Maybe you want to budget for ads that are different in the Christmas season than in the heat of July. Constantly use metrics to track what is working and mix it up if you want to attract different consumers. 

What Is Amazon AMS?

AMS is the catch-all term that covers all sponsored products and search ads on Amazon. 

  • Different than Amazon Advertising Platform (AAP), Amazon AMS is considered Cost-Per-Click (CPC), in that you pay for advertising based on the amount of clicks the ad generates. 
  • Amazon AMS is essentially a platform that houses all of the different types of Amazon ads. 
  • The term “Amazon Marketing Services” and the acronym “AMS” are actually both being retired and replaced by “Amazon Advertising.”

In summary, AMS can be used loosely to describe any Amazon Advertising that you participate in – do not get too hung up on acronyms. 

How Does Amazon Marketing Services Work?

AMS, or Amazon Advertising, works by promoting your products to the top of the search page. For ever click a consumer does on your ad, you pay Amazon a nominal advertising fee. By paying to promote your products, you are going to generate more sales and more income. 

Amazon will take a small fee from that, but your products are going to be selling more often, so you will see an increase in sales and in revenue despite the small fee at click-per-cost.

AMS, or Amazon advertising, can be summarized by saying it offers these services:

  • Cost-Per-Click – this is the most popular option, and you will pay a small fee when your ad generates a click 
  • The other option is products that actually work by impressions, and you pay a fee in Cost-Per-Thousand

The most important piece of Amazon Advertising is that it will help get your item in the eyes of many shoppers. 

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Why Is Amazon AMS Important?

Selling on Amazon can be overwhelming to buyers and sellers alike. There are a lot of products and a lot of customers. Advertising is one way that you can get your product to jump out. 

Hundreds of millions of products are on Amazon, and hundreds of millions of people shop on Amazon. One of the only ways you, as a seller, can elevate your product and get it in front of a consumer, is to partake in Amazon Advertising, or AMS. 

By advertising, you are guaranteeing your product gets sponsored and put at the top of search results. People usually do not scroll too far down their search results or even go to the second page of results, making it paramount that your product is placed in the top of the search results, so that it does not get lost in the sea of similar products.

You can also use advertising to highlight what makes your product a better option than similar products being sold by competitors. What makes it unique? Is it cheaper, faster, or bigger? Use the uniqueness to help make it stand out from the pack.

Lastly, when you are on the Amazon website, you will notice that a large percentage of their website is product ads, now you can have your product listed in one of the advertisements.

AMS/AAP/DSP

Amazon uses a lot of acronyms for its advertising services. No matter the acronym, the gist is still the same – sign up for Amazon advertising so you can target consumers and generate traffic to your brand or product pages, which will increase sales and revenue.

Where do AMS and AAP Fit in Your Marketing Funnel?

Amazon advertising should be at the top of your marketing budget for a few different reasons.

  1. Amazon advertisements can reach out to other platforms that partner with Amazon, so you can attract customers to your page who were shopping or browsing elsewhere
  2. Ads on the Amazon website can help you gain customers from your competition, with the right ad placement on the competitor’s own product page
  3. More people shop on Amazon than anywhere in the world – use your marketing budget to get more customers than you could on any other platform.

Using Amazon AMS: How to Sign up for Amazon Marketing Services

Obviously, using Amazon Advertising is one of the most important things you can do in support of your brand. So, how do you get involved with AMS? 

  • If you are a vendor, try Amazon Advertising Console. Sellers can access something similar options under the campaign manager tool in Seller Central. This tool will help you analyze data, and propel you to more sales and revenue.
  • For everything except sponsored products, you will need to have your brand registered to use these features as a seller.

How is AMS different from basic Sponsored Products?

This is really a comparison of vendor services and seller services. Some advertising tools are only available to vendors, whereas basic sponsored products can be used by vendors or sellers.

Sponsored Product Ads are one of the best ways sellers can advertise on Amazon, whereas AMS is primarily used by Vendor Central. 

Sponsored Ads work in 2 ways:

  1. On your competitors’ pages: your ad can be placed on the page of the competition, so you can work towards gaining customers that would normally buy another product
  2. Display in 3 vibrant places on your product page attracting the eyes of viewers to the ad. With this type of advertisement, your product will be visibly displayed all over the webpage, almost begging consumers to click to your page.

Amazon Advertising tips that work during COVID-19

While COVID-19 has decimated the entire world, one area that has been helped by COVID-19, not hurt, is online shopping. With people still stuck inside for a while yet, pending the worldwide release of a vaccine, most people do the bulk of their shopping online at large retailers like Amazon.

Here are some great tips that can help you with your advertisements on Amazon during COVID-19

 Make sure you are focused on the right category 

Some products are affected negatively by the coronavirus, as people do not need the same products they once did. But, other categories are showing spikes in sales because of different needs. With more people shopping online than ever before, make sure your product ads are focused correctly. 

Is your ad budget allocated correctly? 

Some products are hot right now, and you should advertise accordingly. Consider allocating your budget towards items like toilet paper and hand sanitizer. You can shift your ads around. For example, if you were advertising products useful in the travel industry, like suitcases, you might want to put that money somewhere else since travel is going to continue to be down for the near future. 

Think about what people are buying during the pandemic, and what has slowed down – then, use your ad budget accordingly. 

Inventory is important

If you know you will run out of stock, pause your ad campaign. However, also focus on not running out of stock. There are trends and patterns associated with pandemic spending. Stock up high on cleaning solutions, face masks, and other hot and heavy items. You can pause your inventory stocking on items that are not selling right now, things related to travel or vacations, for example. 

You can do a lot with the same budget as before the pandemic, you just want to allocate your resources the right way.

Launch a new Product 

While you might be hesitant about starting something new during the pandemic – so is everyone else. There is a high demand for certain products, and the time has never been better to capitalize on that and launch something new. 

Maybe you can launch something in the same categories you are already selling in. For example, if you are already selling bathroom supplies, now maybe you want to branch out and sell some new cleaners specifically for the bathroom. This lets you be aggressive, seize opportunity, but still stay close to your comfort zone so you do not feel like you are taking too much of a risk. 

Data supports results – use it 

We are far enough along in the pandemic that there are trends and data to support what the popular items are. Using data and statistics can help you focus your budget and advertising appropriately. Strategize according to the data that is available. 

Do not use stale data, use data that is available since March, 2020, which is when the pandemic really took hold. Analyze things like:

  • What are the most popular items during the pandemic?
  • Are certain categories doing better than others? Are there certain items selling more than their competitors? 
  • Would your inventory hold up with more purchases?

The data is there for you, use it to your advantage. Strategize and react the right way.

Customers are more important than ever before 

Do not lose sight of how important customer relationships are. The pandemic has caused tension everywhere. Unemployment is high, but people still need supplies, and many are leery of going out to stores and purchasing what they need.

Reach out to any long-time customers you have, build relationships, and consider even offering a small discount for their loyalty. This could be an opportune time to utilize relationships you have been building for years, and you could give back to the community at the same time. 

COVID-19 has presented a unique opportunity for retailers. While some brick and mortar stores have been forced to close, and might not ever recover, the time is now for online retailers. Strategize and sell the right products, as people are concerned not only about this pandemic, but over the possibility of more pandemics happening down the road. Capitalize on this burgeoning industry of online retail.

Should You Advertise on Amazon?

Remember, if you have questions about getting started with advertising on Amazon, our personal assistant is here to help you. If this article did not provide enough information, do not spend more time researching and reading other information, just ask direct questions to our personal assistant and we can help you get started. 

There really are no negatives to advertising on Amazon, you just have to decide on what type of advertisement is right for you. Our assistant will help you with that decision, and we are available 24 hours a day, 7 days a week. You can start small, with just a couple of advertisements, and you will be able to track metrics to monitor the success of your advertisements as you generate more and more sales of your product.