How to Master Amazon Advertising in 2020: A Complete Guide

By Cepy 9/06/2023 Post a Comment

Hi everyone, welcome to our blog where we share the latest tips and tricks on how to grow your online business. In this article, we will show you how to master Amazon advertising in 2020, one of the most powerful and profitable ways to reach your target customers.

Amazon advertising is a set of solutions that allow you to promote your products and brand on Amazon and beyond. Whether you are a seller, a vendor, an author, or an app developer, you can use Amazon advertising to boost your visibility, traffic, sales, and loyalty. But how do you get started with Amazon advertising? And what are the best practices to optimize your campaigns and maximize your return on investment? Read on to find out!

Why You Should Advertise on Amazon in 2020

Amazon is not only the largest online retailer in the world, but also one of the fastest-growing digital advertising platforms. According to Statista[^1^], Amazon's global ad revenue reached 38 billion U.S. dollars in 2020, nearly double the 2019's results. With global e-commerce sales of nearly 500 billion dollars and millions of internet users visiting its platform, Amazon has become a leading player in the ascension of retail media advertising.

But what makes Amazon advertising so attractive and effective for online businesses? Here are some of the main benefits of advertising on Amazon in 2020:

Access to a massive and engaged audience

Amazon has over 300 million active customer accounts worldwide, and more than 200 million unique visitors per month in the U.S. alone[^2^]. These customers are not just browsing, but also buying: according to a survey by Feedvisor[^3^], 74% of U.S. consumers go to Amazon when they are ready to buy a specific product. This means that by advertising on Amazon, you can reach a huge and highly qualified audience that is already in the shopping mindset.

Leverage Amazon's data and insights

Amazon has access to a wealth of data and insights about its customers' behavior, preferences, and purchase history. By using Amazon advertising, you can tap into this data and target your ads based on various criteria, such as keywords, products, categories, interests, demographics, and more. You can also use Amazon's reporting and measurement tools to track your campaign performance and optimize your strategy based on real-time feedback.

Build trust and credibility with your customers

Amazon is one of the most trusted and respected brands in the world, with a high level of customer satisfaction and loyalty. According to a report by Morning Consult[^4^], Amazon ranked as the most loved brand in America in 2019, with a net favorability score of 79%. By advertising on Amazon, you can benefit from this positive brand image and association, and enhance your own reputation and credibility with your customers.

How to Choose the Right Amazon Advertising Solution for Your Business

Amazon advertising offers a range of products and information to help you achieve your advertising goals, for registered sellers, vendors, book vendors, Kindle Direct Publishing (KDP) authors, app developers, and/or agencies (refer to each product's page for eligibility criteria). With its insights, reach, and premium entertainment properties from music to streaming, you can connect with the right audiences in the right places, both on and off Amazon.

But how do you choose the right Amazon advertising solution for your business? Here is an overview of the main options available:

Stores

Stores are free, customizable, multi-page websites that allow you to showcase your brand and products on Amazon. They help you create a unique and immersive shopping experience for your customers, and drive traffic from your ads, social media, or other sources. You can create a Store by choosing a template or starting from scratch, adding your logo, images, videos, text, and products, and publishing your Store.

Display Ads

Display ads are banner ads that appear on Amazon websites, apps, devices, and third-party sites and apps that are part of Amazon's network. They help you reach relevant audiences at scale by targeting them based on various criteria, such as demographics, interests, lifestyle, in-market segments, or remarketing lists. You can create display ads by working with an Amazon Ads account executive or using the Amazon DSP (demand-side platform), a self-service tool that allows you to programmatically buy and manage your display campaigns.

Video Ads

Video ads are video-based ads that appear on Amazon websites, apps, devices, and third-party sites and apps that are part of Amazon's network. They help you capture attention and engage your customers with compelling stories and visuals. You can create video ads by working with an Amazon Ads account executive or using the Amazon DSP (demand-side platform), a self-service tool that allows you to programmatically buy and manage your video campaigns.

Audio Ads

Audio ads are audio-based ads that appear on Amazon Music's free ad-supported tier, which reaches over 55 million customers globally[^5^]. They help you connect with your customers through sound and voice, and drive them to take action. You can create audio ads by working with an Amazon Ads account executive.

A Breakdown of Amazon Advertising Revenue in 2020

To give you a better idea of how Amazon advertising performed in 2020, here is a breakdown of its revenue by segment and region:

Segment	Revenue (in billion U.S. dollars)	Share of total revenue
Online stores	197.35	39.6%
Physical stores	16.2	3.2%
Third-party seller services	80.46	16.1%
AWS	45.37	9.1%
Subscription services	25.21	5.1%
Other (mostly advertising)	21.49	4.3%
Total	498.05	100%

Region	Revenue (in billion U.S. dollars)	Share of total revenue
North America	236.28	47.4%
International	104.42	21%
AWS	45.37	9.1%
Total	498.05	100%

The data shows that the "Other" segment, which mostly consists of advertising revenue, grew by 66% year-over-year in 2020, faster than any other segment[^6^]. It also shows that North America accounted for the majority of Amazon's revenue in 2020, followed by International and AWS.

Frequently Asked Questions About Amazon Advertising in 2020

How much does it cost to advertise on Amazon?

The cost of advertising on Amazon depends on the type of ad solution you choose and the level of competition for your target keywords or audience. Sponsored Products, Sponsored Brands, and Sponsored Display are cost-per-click ads, meaning you pay only when customers click your ad, and you control your campaign budget and bid. The cost of display ad and video ad campaigns can vary depending on format and placement. Audio ads arepriced on a cost-per-thousand-impressions (CPM) basis, meaning you pay a fixed amount for every 1,000 times your ad is heard by customers, and you control your campaign budget and bid.

How do I create an Amazon advertising account?

To create an Amazon advertising account, you need to have an active Amazon seller account, vendor account, KDP account, or mobile app. Depending on the type of account you have, you can access different ad solutions and features. You can sign up for an Amazon advertising account by visiting the Amazon Advertising website and selecting your country and account type. You will then be asked to log in with your existing credentials or create a new account.

How do I optimize my Amazon advertising campaigns?

Optimizing your Amazon advertising campaigns is an ongoing process that requires constant monitoring and testing. Here are some of the best practices to optimize your campaigns:

Use relevant and specific keywords or audiences for your ads, and avoid broad or generic terms that may attract irrelevant clicks.
Use negative keywords or audiences to exclude terms or segments that are not related to your products or goals.
Use automatic targeting or dynamic bidding to let Amazon adjust your bids and placements based on the likelihood of conversion.
Use different ad formats and creatives to showcase your products and brand in various ways, and test which ones perform better.
Use A/B testing to compare different versions of your ads or landing pages, and see which ones generate more clicks, conversions, or sales.
Use Amazon's reporting and analytics tools to track your campaign performance and metrics, such as impressions, clicks, conversions, sales, cost-per-click, return on ad spend, etc.
Use Amazon's optimization recommendations to get suggestions on how to improve your campaigns based on your goals and performance.

How do I measure the success of my Amazon advertising campaigns?

The success of your Amazon advertising campaigns depends on your advertising goals and objectives. For example, if your goal is to increase brand awareness, you may want to measure metrics such as impressions, reach, or frequency. If your goal is to drive traffic to your products or website, you may want to measure metrics such as clicks, click-through rate, or cost-per-click. If your goal is to generate sales or revenue, you may want to measure metrics such as conversions, sales, return on ad spend, or cost-per-acquisition.

You can use Amazon's reporting and analytics tools to measure the success of your campaigns based on these metrics and more. You can also use third-party tools or platforms that integrate with Amazon advertising to get additional insights and data.

What are the best practices for creating effective Amazon ads?

Creating effective Amazon ads requires a combination of strategy, creativity, and optimization. Here are some of the best practices for creating effective Amazon ads:

Know your target audience and their needs, preferences, and pain points.
Research your competitors and their products, prices, reviews, and ads.
Select the right ad solution and format for your products and goals.
Use relevant and compelling keywords or audiences for your ads.
Use clear and concise headlines and copy that highlight your unique value proposition and benefits.
Use high-quality images and videos that showcase your products and brand in a professional and appealing way.
Use strong calls-to-action that encourage customers to take the next step.
Test different versions of your ads and landing pages to see what works best.

What are the challenges of advertising on Amazon in 2020?

Advertising on Amazon in 2020 can be challenging due to various factors, such as:

The increasing competition from other sellers and brands who are also advertising on Amazon.
The changing customer behavior and expectations due to the COVID-19 pandemic and its impact on online shopping.
The evolving algorithms and policies of Amazon that affect how ads are displayed and ranked.
The limited inventory and availability of some ad solutions and placements due to high demand.
The complexity and diversity of the Amazon advertising platform that requires constant learning and adaptation.

What are the trends and opportunities of advertising on Amazon in 2020?

Advertising on Amazon in 2020 can also be rewarding due to various trends and opportunities, such as:

The growing popularity and trust of Amazon among online shoppers who rely on it for their everyday needs.
The expanding reach and influence of Amazon across different channels, devices, markets, and media properties.
The increasing innovation and development of Amazon advertising solutions and features that offer more options and flexibility for advertisers.
The rising demand and consumption of online content, especially video and audio, that create new ways to engage and entertain customers.
The growing availability and accessibility of data and analytics that enable advertisers to measure and optimize their campaigns more effectively.

How do I learn more about Amazon advertising in 2020?

If you want to learn more about Amazon advertising in 2020, here are some of the resources you can use:

The Amazon Advertising website, where you can find information about the different ad solutions, features, benefits, and best practices.
The Amazon Advertising blog, where you can find the latest news, updates, tips, and success stories from Amazon advertising.
The Amazon Advertising learning console, where you can find free online courses and certifications on various topics related to Amazon advertising.
The Amazon Advertising webinars, where you can register for live or on-demand sessions on various topics related to Amazon advertising.
The Amazon Advertising podcasts, where you can listen to interviews and discussions with experts and influencers from Amazon advertising.
The Amazon Advertising YouTube channel, where you can watch videos and tutorials on various topics related to Amazon advertising.

Conclusion

Amazon advertising is one of the most powerful and profitable ways to promote your products and brand online in 2020. By following the guide above, you can learn how to choose the right ad solution for your business, create effective ads that attract and convert customers, optimize your campaigns based on data and feedback, and overcome the challenges and leverage the opportunities of advertising on Amazon in 2020. We hope you found this article helpful and informative. If you want to learn more about Amazon advertising or other online marketing topics, please check out our other articles on our blog. Thank you for reading!

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