Amazon is one of the most popular online marketplaces in the world, with millions of sellers competing for customers’ attention. One of the most effective ways to stand out and drive sales is through Amazon advertising. As an Amazon seller, you know that advertising is a crucial component of your overall marketing strategy.
How do I do that?
In this article, we’ll explore two main types of Amazon advertising – Sponsored Products and Sponsored Brands – and help you decide which one is right for your business. If you’re looking at how to actually implement these, check out these:
- How to setup a Sponsored Product campaign on Amazon
- How to setup a Sponsored Brand campaign on Amazon
- We also recommend giving this a quick read if you’re fresh and unfamiliar with advertising on Amazon.
Sponsored Products vs. Sponsored Brands: What's the Difference?
Before we dive into the decision-making process, it’s important to understand the differences between sponsored products and sponsored brands. We know the saying, walk before you run. We recommend starting with Sponsored Product campaigns on Amazon because:
- They’re easier to set up
- They’ll help you discover your highest performing KWs
Sponsored Products promote individual products using keywords and charge when a shopper clicks on the ad. Sponsored Brands usually have a higher cost-per-click, promote brands and multiple products, and require more setup. Sponsored Products remain a significant source of advertising even after using Sponsored Brands because they capture shoppers’ attention better by offering specific products.
Sponsored Products
Ads that appear at the top or bottom of search results or on product detail pages. These ads are keyword-targeted and can help increase product visibility and sales. These ads appear similar to organic search results, with the word “Sponsored” in the corner.
Now that we see the sponsored icon, let’s look at a larger example.
The first two products in the photo below are different from the rest, can you see why?
That’s right, it’s the small sponsored icon!
Sponsored Brands
Formerly known as Headline Search Ads, these are ads that promote a brand and its product portfolio. They appear at the top of search results pages, featuring a brand logo, custom headline, and up to three individual products.
While these types of advertising can help sellers reach Amazon audiences, they differ in ad placement, ad format, and targeting options.
Additionally, you can choose between three different ad formats:
Video
- If your goal is to drive conversion and purchases, you can use a video to promote a single product and link that video to the product detail page.
- If your goal is drive awareness and consideration, you can use a video to promote your brand and link that video to your Store.
- This ad will show within shopping results when shoppers are searching for products on Amazon as well as other placements across the site.
This leads us to product collection ads.
Product collection ads
- Enables you to focus on up to three items in your brand that are showcased on a landing page of your selection. Essentially, this means that you can direct visitors to either your unique Amazon storefront or a designated landing page that solely displays the products highlighted in your ad.
Here is an example of an Amazon storefront displaying their products
Store spotlight ads
If we were to click the Holstery brand logo or “shop holstery, we’re taken to a landing page.
When to Use Sponsored Products in Your Amazon Ads Strategy
Consistently running Sponsored Products ads is crucial for preventing your products from being buried on later pages of Amazon’s search results. By utilizing Sponsored Products:
- Your products will have increased visibility.
- Better organic ranking.
- More likely to appear at the top of search results.
We have perfected our own process to manage PPC advertising on Amazon:(Here it is in detail)
Step 1: Establish a Strong Foundation
The first and most important step is to understand your business and product goals. For example, are you thinking about PPC as a profit generator in itself or are you just trying to maximize sales to boost your products even at the expense of profit? Do your research to identify your target audience, their needs and preferences, and your competitors.
Step 2: Conduct Keyword Research and Optimization
Identify the most relevant keywords, categories, and competitors to include in your campaigns. Use keyword research tools like Helium 10 to find potential opportunities that match your goals.
Step 3: Monitor Your Campaigns Like a Farmer Tending to Their Crops
Regularly check your campaign data to determine which keywords are driving conversions and which ones are not. Optimize your campaigns by adjusting bids and ad placements to maximize your Return on Investment (ROI).
Step 4: Eliminate Keywords That Are Not Profitable
Weed out underperforming keywords that are not generating sales or costing too much. Eliminating these keywords will help you save money and improve the overall performance of your campaigns.
Step 5: Focus on Profitable Keywords
Analyze your data to identify which keywords are most profitable for your campaigns. Creating broad campaigns to harvest profitable customer search terms/keywords, then creating exact campaigns focusing on the profitable keywords is a great formula for success.
Best Practices for Amazon Sponsored Product Ads
- Conduct thorough keyword research:
To ensure that your ads are reaching the right audience, it’s crucial to choose the right keywords. Use keyword research tools to identify relevant keywords with high search volume and low competition. Also, make sure to include negative keywords to prevent your ads from showing for irrelevant search queries.
- Optimize your product listings:
Your product listings should be optimized for both search engines and customers. Make sure to include high-quality images, detailed descriptions, and relevant keywords in your title and bullet points. Use A/B testing to compare the performance of different ad variations and refine your strategy over time.
- Set appropriate bids:
The amount you bid for a keyword determines how often your ad will be displayed and its position on the search results page. Set your bids based on the value of the keyword to your business and the competition level.
- Monitor and optimize your campaigns:
Track your key metrics such as click-through rates, conversion rates, and advertising cost of sales (ACoS). Use this data to optimize your campaigns.
When to Use Sponsored Brands in Your Amazon Ads Strategy
Sponsored Brands are an excellent choice for building brand awareness, showcasing a product portfolio, and targeting high-competition keywords.
Here are a few scenarios where Sponsored Brands are most effective:
- Building Brand Awareness:
Sponsored Brands are an effective way to increase brand visibility and recognition on Amazon. By featuring a brand logo and custom headline, sellers can introduce their brand to potential customers and create brand recognition.
- Showcasing Product Portfolio:
Sponsored Brands are ideal for showcasing a brand’s product portfolio. By featuring up to three products in the ad, sellers can introduce customers to multiple products within their brand.
- High-Competition Keywords:
Sponsored Brands can be used to target high-competition keywords that are difficult to rank organically. By appearing at the top of search results, sellers can increase visibility and drive traffic to their products.
Best Practices for Amazon Sponsored Brands Ads
To create a successful Amazon Sponsored Brands campaign, it is important to follow these best practices:
- Target Relevant Keywords
When it comes to Sponsored Brands campaigns, it’s important to consider the performance of your Sponsored Products campaigns and adjust your targeting accordingly. Focusing on your top keywords/customer search terms and categories in a Sponsored Brands campaign can help you avoid overspending on ads that may not perform as well. In short, using the insights gained from your Sponsored Products campaigns can inform and improve your Sponsored Brands strategy.
- Optimize Your Ad Creative
Optimizing your ad creative is essential to capturing the attention of potential customers. Use high-quality images and compelling ad copy to showcase your product and encourage clicks. Make sure your ad copy includes relevant keywords and highlights the unique features and benefits of your product.
- Set a Realistic Budget
Setting a realistic budget is key to ensuring that your Sponsored Brands ads are cost-effective. Start with a small daily budget and gradually increase it as you gain more data and optimize your campaign. Keep an eye on your ad spend and adjust your budget accordingly to ensure that you are getting a good return on investment.
- Monitor Your Campaign Performance
Monitoring your campaign performance is crucial to optimizing your Sponsored Brands ads. Keep track of your click-through rate (CTR), conversion rate, and cost-per-click (CPC) to identify areas for improvement. Use this data to adjust your targeting, ad creative, and budget to maximize your campaign’s performance.
Important Tips for Success
- Assessing Your Budget and Margins
Another factor to consider when deciding between sponsored products and sponsored brands is your budget and profit margins. Sponsored products are generally less expensive than sponsored brands, so if you have a limited budget, they may be the better option. However, sponsored brands can help increase your profit margins by promoting multiple products at once and increasing brand awareness, so they may be worth the investment if you have the budget for it.
- Analyzing Your Competitors
It’s also important to consider your competitors when deciding between sponsored products and sponsored brands. If your competitors are using sponsored brands to promote their products and increase brand awareness, you may need to do the same to remain competitive. On the other hand, if your competitors are primarily using sponsored products and you have a limited budget, you may be able to gain an advantage by using sponsored brands to stand out.
- Testing and Monitoring Your Ads
Finally, it’s essential to test and monitor your ads to determine which format is most effective for your business. A/B testing can help you determine which ad format is generating the most clicks, conversions, and sales. Additionally, monitoring your ad performance can help you identify opportunities to optimize your campaigns and increase ROI.
Choosing the right advertising strategy is essential for success on Amazon. Sponsored Products and Sponsored Brands, offer unique benefits and can be effective in different scenarios. By understanding the differences between these advertising strategies and considering your business’s unique needs and goals, you can choose the right advertising strategy to drive sales and grow your business on Amazon.
Frequently Asked Questions
Q: How do I know which advertising strategy is right for my business?
A: The advertising strategy that is right for your business will depend on your advertising goals, budget, and target audience. Consider your business’s unique needs and goals when choosing an advertising strategy.
Q: Can I use multiple advertising strategies at the same time?
A: Yes, you can use multiple advertising strategies at the same time. Many sellers find that using a combination of advertising strategies is most effective for reaching their advertising goals.
Q: How do I measure the success of my advertising campaigns?
A: Amazon provides a variety of metrics to help sellers measure the success of their advertising campaigns, such as impressions, clicks, and sales. Sellers can use these metrics to evaluate the effectiveness of their advertising strategies and make adjustments as needed.
To do this,
- navigate to the Amazon Ads page
- find reporting and measurement on the left side
- click sponsored ads report
Viola! Just click Sponsored Product Search term report!
Did anything in this article spark your curiosity or bring up a question? Comment below or email us at Howdy@PPCFarm.com. We love talking about PPC!
