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With millions of products sold on the Amazon marketplace, sellers need a competitive edge to stand out and ultimately increase sales on Amazon. This is where Amazon PPC (Pay Per Click) advertising comes in. It is important for  Amazon sellers to get their advertising strategy in place to minimize costs and maximize results. 

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If you are new to Amazon advertising, you need to understand the basics of Amazon’s advertising solutions to create effective advertising campaigns and optimize every penny spent. 

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In this guide, we will look at how to increase conversion rate on Amazon using Amazon advertising. Here’s what we’ll cover: 

• What are Amazon PPC ads? 
• Why are Amazon PPC ads important for your business? 
• Types of Amazon PPC ads
• How to start advertising on Amazon 
• Key metrics to measure advertising success

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What are Amazon PPC Ads? 

Amazon PPC (Pay Per Click) Ads, also known as Amazon Sponsored Ads is an Amazon advertising platform that allows sellers to increase their product’s visibility and amplify Amazon sales. With Amazon PPC, you pay only when a customer clicks on your Amazon advert. 

The Amazon advertising platform is easy-to-use and allows sellers to set up different types of advertising campaigns in just a few minutes. 

Benefits of Amazon PPC ads for your business? 

Advertising your products on Amazon is important if you want to expand your business and rake in significant sales. Let’s highlight a few benefits of leveraging Amazon advertising solutions:

Increase in product sales

Perhaps one of the most obvious benefits of running PPC ads is to increase product sales. This is the major objective (whether short-term or long-term) for any Amazon seller. Running ad campaigns provides wider audience reach and specific targeting which ultimately increases your conversion rate and product sales. 

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Reach more customers 

Leveraging Amazon Advertising exposes your product and brand to millions of potential customers. This exposure increases your customer and sales ratio. It also increases views, impressions, and conversion rate within a short time. 

Brand awareness for new products

We all know that products that have the most sales are at the top of search results. If you have a new product, the chances of ranking high for major keywords are very slim. Running PPC campaigns is a great way to improve product organic ranking and sales potential.

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Increase in conversion rates 

With Amazon advertising, you can reach a wider audience and get your product in front of interested customers. The more people get to know about your product through Amazon ads, the easier it is to find your product and ultimately increase your conversion rate. 

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Types of Amazon PPC ads

Online retailers selling on Amazon can reach potential customers and increase sales using these types of Amazon PPC Ads:

• Sponsored Products ads
• Sponsored Brands ads
• Amazon Display ads 

Sponsored Product ads 

Sponsored Product ads are one of the most common ads used by almost every seller. With Sponsored Products, you don't need to be brand-registered. They appear at the top of search results and on organic search results. 

You can use Sponsored Products to target product ASINS and specific keywords. 

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You can do two types of targeting with Sponsored Products: Automatic targeting ads and Manual targeting ads. 

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With automatic targeting, Amazon decides on the keywords to target based on your product. This is especially helpful if you are new to Amazon advertising and don't know which keywords to target. On the other hand, Manual targeting ads give you full control. You can decide which keywords to target and bid on. 

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To use Sponsored Product ads, you only need to have a Professional Seller Account. Unfortunately, sellers with an Individual Seller Account do not have access to Sponsored Product ads. Also, to use Sponsored Products, your product needs to be Buy-Box eligible.  

Benefits of Sponsored Product Ads 

• Sponsored Product ads push you up search results and get you in front of targeted shoppers who are purchase ready.
• If you have a new product, Sponsored Product ads can increase your impressions, clicks, and ultimately sales. 

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Sponsored Brands ads 

Sponsored Brands ads formerly known as Amazon Headline Search Ads help you promote your brand and advertise your products. 

Sponsored Brands are banner ads that feature your brand logo, thumbnails of three of your products, and a tagline. It is more advanced and only available to sellers enrolled on the Amazon Brand Registry. 

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This ad helps to increase brand awareness, allowing sellers to advertise up to three products at once. They usually appear on Amazon search results above the Sponsored Products ads. 

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Sponsored Brands ads can appear in three different formats:

• Product collection: This ad type allows you to showcase up to three of your products and drive traffic to your Amazon store or landing page. 
• Store Spotlight: This ad type is only available to sellers with an Amazon store. An Amazon store is a custom-made mini-website that allows sellers registered under the Amazon Brand Registry to advertise their brand and uniquely tell their story. With this ad type, brands can advertise multiple products from different page categories on their Amazon store.
• Sponsored Brand Videos: This ad type can give sellers an edge over competitors. It is catchy and plays in a loop. This is great for customers scrolling through search results. A good video ad can give customers enough information about your product in a few seconds, increasing your conversion rates. Amazon recommends that videos should be short (between 15 to 30 seconds) and informative. 

Benefits of Sponsored Brands ads

• Sponsored Brands ads have less competition as it is only available to brands registered under the Amazon Brand Registry 
• Sponsored Brands ads allow you to advertise up to three products giving customers more products to look at
• With this type of ad, you can stand out in search results and drive traffic to your Amazon store

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Amazon Display ads

Amazon Display ads are a powerful advertising tool that can reach customers both on and off Amazon. This means you can advertise to customers on apps and third-party websites.

With Display ads, you target customers based on factors like shopping behavior and interests, instead of keywords or competitor products. 

With Amazon Display ads you can reach customers no matter where they are on their buying journey.

For example, you can use Display ads to retarget customers who viewed your listing but couldn't make it to the checkout section. 

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There are three types of targeting with Amazon Display ads: 

• Product targeting ads: With this ad type, you can target customers searching for your product, competitors' products, or products in related categories. 
• Audiences: Views remarketing: With this ad type, you can retarget customers who viewed your listing or didn't complete a purchase. This ad will appear both on and off Amazon to customers who viewed your listing in the last 30 days but didn't make a purchase. This is a great way to convert potential buyers who are interested in your product. 
• Audiences: Interests: With this ad type, you can advertise your products to customers based on specific interests. 

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Benefits of Amazon Display ads 

• Display ads are only available to sellers registered under Amazon Brand Registry which means you have less competition. 
• With Display ads, you can retarget customs both on and off Amazon and increase conversion rates. 

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How to start advertising on Amazon 

To start advertising your products on Amazon, you only need to go through three simple steps: 

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• Go to your Seller Central account, click on the Advertising bar > Campaign manager, and then select Create Campaign.
• Next, choose your campaign type. It could be Sponsored Product ads, Sponsored Brand ads, or Sponsored Display ads. 
• Create and name your campaign and add your budget. 

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Key metrics to measure advertising success 

There are important metrics to help Amazon sellers measure their results and optimize advertising campaigns. Here are a few advertising metrics to look out for: 

• Advertising Cost of Sales (ACoS): This metric is represented as a percentage of sales spent through advertising. Ultimately this metric measures how efficient your ad was. It is calculated by dividing the total amount spent on ads by the revenue generated. 
• Impressions: This indicates how many times your ad was displayed to a customer on the Amazon marketplace. 
• Clicks: This shows you the number of times your ad was clicked. Amazon will exclude accidental clicks
• Sales: This shows you the total amount of sales recorded within a week of clicking on your ad
• Spend: This shows you the total amount of click costs for each product ad. 
• Return on Ad Spend(ROAS): This is another metric that measures the efficiency of your ad. To calculate your ROAS, divide the sales dollars for your ad by your ad spend. For example, if you get a ROAS of 7, it would mean that for every dollar spent, you get revenue of $7. 

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Conclusion 

Amazon continues to provide tools and solutions to help sellers grow their business and increase sales and revenue. 

With Amazon Advertising, you can get your products in front of targeted customers, increase brand awareness and sales. There are different advertising types you can choose from. 

When registered under Amazon Brand Registry, you have access to Sponsored Brand ads and Display ads which allow you to create video ads and retarget customers off Amazon. If you are not brand-registered, you can still leverage Sponsored Product ads to reach potential customers. 

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