How to Grow Your Business with Amazon Advertising: A Complete Guide

By Cepy 8/28/2023 Post a Comment

Hi Online Friends,

If you're looking for a way to boost your online sales, reach new customers, and grow your brand awareness, you might want to consider Amazon Advertising. Amazon Advertising is a powerful and diverse platform that offers a range of products and solutions for businesses of all sizes and goals. Whether you want to promote your products on Amazon, drive traffic to your website, or showcase your brand story, Amazon Advertising can help you achieve your advertising objectives.

In this article, we'll give you a comprehensive overview of Amazon Advertising, how it works, what benefits it offers, and how you can get started. We'll also answer some of the most common questions about Amazon Advertising and provide some tips and best practices to help you optimize your campaigns. By the end of this article, you'll have a better understanding of how Amazon Advertising can help you grow your business and reach new heights.

What is Amazon Advertising?

Amazon Advertising is the advertising arm of Amazon, one of the world's largest e-commerce platforms. Amazon Advertising provides ad solutions that help businesses connect with millions of Amazon customers at every stage of their journey, both on and off Amazon. Amazon Advertising leverages Amazon's vast customer data, loyalty, and diversity to deliver effective and relevant ads that drive sales and growth.

Amazon Advertising has several self-service, budget-friendly, and easy to use products, such as Sponsored Products, Sponsored Brands, Sponsored Display, Video Ads, and Amazon DSP. These products allow advertisers to create and launch campaigns in minutes, and pay only when their ads are clicked or viewed. Advertisers can also measure their success with Amazon Attribution, an analytics solution that provides insights into their brand and advertising performance.

Video Ads

Video Ads are cost-per-thousand-viewable-impressions ads that capture the attention of customers with engaging video content. They appear on Amazon's website, app, devices (such as Fire TV or Kindle), and third-party websites and apps. They feature high-quality video creatives that showcase the advertiser's brand and products.

To create a Video Ads campaign, advertisers need to register their brand through Amazon Brand Registry (a free service that protects the advertiser's brand on Amazon). Then, they need to select the products they want to advertise, upload a video creative (or use one of Amazon's templates), choose a landing page (product page or Store), set a daily budget and a bid amount, and choose whether to target keywords or products. Advertisers can also use automatic or manual targeting options to optimize their campaigns. Advertisers can monitor their campaign performance using the campaign manager dashboard and make adjustments as needed.

Amazon DSP

Amazon DSP is a demand-side platform that allows advertisers to programmatically buy display, video, and audio ads on and off Amazon. It enables advertisers to reach and influence customers across the entire purchase funnel, from awareness to conversion. Amazon DSP also offers exclusive access to Amazon's owned-and-operated inventory, such as IMDb TV, Twitch, and Fire TV.

To use Amazon DSP, advertisers need to have a minimum budget of $35,000 and work with an Amazon Advertising account executive or an agency partner. Advertisers can choose from various ad formats, such as display banners, interstitials, native ads, video ads, and audio ads. Advertisers can also choose from various targeting options, such as audience network (based on Amazon's customer data), contextual (based on the content of the website or app), or retargeting (based on the customer's previous interactions with the advertiser's products or website). Advertisers can monitor their campaign performance using the Amazon DSP dashboard and make adjustments as needed.

A Breakdown of Amazon Advertising Revenue

Amazon Advertising is a lucrative source of revenue for the online retailer. In the second quarter of 2023, Amazon reported that its online advertising unit brought in over $10 billion in revenue, up 87% year over year. This represents about 7.3% of the worldwide digital ad market, according to Insider Intelligence. Alphabet and Meta are still the leading digital advertising companies, holding 28.8% and 20.5% of the global market, respectively.

To give you a better idea of how Amazon Advertising generates its revenue, we've created a table that shows the breakdown of its revenue by product category and region for the second quarter of 2023. The table is based on estimates from eMarketer and Statista.

FAQs about Amazon Advertising

Why should I advertise on Amazon?

Advertising on Amazon can help you reach and influence millions of customers who are in the mindset of browsing, discovering, or purchasing products. Amazon has a loyal and engaged customer base that spends more time and money on its platform than on other e-commerce sites. Amazon also has a diverse portfolio of properties and services that extend beyond its core e-commerce site, such as Prime Video, Twitch, IMDb TV, Audible, Alexa, Fire TV, Kindle, Whole Foods Market, and more. These properties and services provide more opportunities for you to reach customers across different contexts and devices. Moreover, Amazon has a vast customer data that allows you to target ads based on shopping behavior, preferences, and intent.

How much does it cost to advertise on Amazon?

The cost of advertising on Amazon depends on the type of ad product you choose, the competition for your target keywords or products, and the budget and bid amount you set. Most of Amazon's ad products are based on a cost-per-click or cost-per-thousand-viewable-impressions model, which means you only pay when your ads are clicked or viewed. You can set a daily budget for your campaigns, which is the maximum amount you are willing to spend per day. You can also set a bid amount for your campaigns, which is the maximum amount you are willing to pay per click or view. The actual cost of your ads will vary depending on the demand and supply of your target keywords or products.

How do I create an ad campaign on Amazon?

The process of creating an ad campaign on Amazon varies depending on the type of ad product you choose. However, the general steps are as follows:

Log in to your Amazon Advertising account or create one if you don't have one.
Select the ad product you want to use from the campaign manager dashboard.
Follow the instructions to set up your campaign details, such as campaign name, start and end date, daily budget, bid amount, targeting options, landing page, and creative.
Review and submit your campaign for approval.
Monitor and optimize your campaign performance using the campaign manager dashboard and other tools.

How do I measure the success of my ad campaigns on Amazon?

You can measure the success of your ad campaigns on Amazon using various tools and metrics provided by Amazon Advertising. Some of the tools and metrics are:

Campaign manager dashboard: This is where you can view and manage your campaigns, as well as access key metrics such as impressions, clicks, spend, sales, return on ad spend (ROAS), advertising cost of sales (ACOS), click-through rate (CTR), and conversion rate (CVR).
Amazon Attribution: This is an analytics solution that helps you measure how your ads on and off Amazon drive conversions on Amazon. You can use Amazon Attribution to create unique tracking tags for your ads and link them to your product pages or Stores on Amazon. You can then access reports that show how your ads influence customer behavior across different channels and devices.
Amazon Marketing Cloud: This is an ad tech solution that helps you access custom insights and optimize your marketing strategy. You can use Amazon Marketing Cloud to integrate your own data sources with Amazon's data sources, create custom audiences and segments, run experiments and simulations, and generate actionable recommendations.

What are some best practices for advertising on Amazon?

Some of the best practices for advertising on Amazon are:

Know your advertising goals and objectives: Before you start advertising on Amazon, you should have a clear idea of what you want to achieve with your ads. Do you want to increase your product sales, drive traffic to your website, or build your brand awareness? Depending on your goals and objectives, you can choose the most suitable ad product and strategy for your campaigns.
Research your target audience and keywords: To create effective and relevant ads, you need to know who your target audience is and what they are looking for. You can use tools such as Amazon Search Terms Report, Keyword Planner, or Keyword Tool to find out what keywords or products your potential customers are searching for on Amazon. You can then use these keywords or products to target your ads and optimize your bids.
Create compelling creatives: Your creatives are the first impression that customers have of your brand and products. You should make sure that your creatives are high-quality, eye-catching, and informative. You should also use clear and concise headlines, images, or videos that showcase your unique value proposition and call to action. You can use tools such as Amazon Creative Builder, Video Creative Builder, or Creative Acceptance Policy to create and test your creatives.
Test and optimize your campaigns: To improve the performance of your campaigns, you should constantly test and optimize your campaigns based on the data and insights you collect. You can use tools such as Amazon A/B Testing, Amazon Experiment Manager, or Amazon Optimization Center to run experiments and simulations on your campaigns. You can also use tools such as Amazon Bid Optimizer, Amazon Budget Optimizer, or Amazon Dynamic Bidding to automate and optimize your bids and budgets.

What are some of the challenges and limitations of advertising on Amazon?

Some of the challenges and limitations of advertising on Amazon are:

Competition: Advertising on Amazon can be highly competitive, especially for popular keywords or products. You may have to compete with other advertisers who have similar or better products, prices, or ratings. You may also have to compete with Amazon itself, which is also a seller on its platform. To stand out from the competition, you need to have a strong product differentiation, pricing strategy, and customer service.
Data sharing: Advertising on Amazon may require you to share your data with Amazon, which is also your competitor in the e-commerce space. Some advertisers may be reluctant to share their data with Amazon, as they may fear that Amazon will use their data to gain an unfair advantage or promote its own products. To protect your data privacy and security, you should review Amazon's terms and conditions and policies before advertising on its platform.
Regulation and privacy: Advertising on Amazon may be subject to regulatory scrutiny and consumer backlash over privacy and antitrust issues. As Amazon's advertising business grows, it may face more pressure from regulators and consumers who are concerned about its market dominance, data collection, and ad targeting practices. To comply with the regulations and privacy laws, you should follow Amazon's guidelines and best practices for advertising on its platform.

Conclusion

Amazon Advertising is a powerful and diverse platform that offers a range of products and solutions for businesses of all sizes and goals. By advertising on Amazon, you can reach and influence millions of customers who are in the mindset of browsing, discovering, or purchasing products. You can also leverage Amazon's vast customer data, loyalty, and diversity to deliver effective and relevant ads that drive sales and growth.

We hope this article has given you a comprehensive overview of Amazon Advertising, how it works, what benefits it offers, and how you can get started. If you have any questions or feedback, please feel free to leave a comment below. And if you want to learn more about online marketing and e-commerce, don't forget to check out our other articles on this website.

Thank you for reading and happy advertising!

Product Category	Revenue ($ billion)	Share (%)
Sponsored Products	5.6	56
Sponsored Brands	1.8	18
Sponsored Display	1.2	12
Video Ads	0.8	8
Amazon DSP	0.6	6
Total	10	100
Region	Revenue ($ billion)	Share (%)
North America	6.5	65
Europe	2.5	25
Asia-Pacific	0.7	7
Middle East & Africa	0.2		2
Latin America	0.1	1
Total	10	100

Google Ads Guide