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2024 Guide to Amazon Sponsored Products Advertising

Whether you're just starting out with your first product or you're an experienced seller launching your 17th item (like me!), Sponsored Products Ads are a super effective way to show off your brand-new product to potential buyers.

Posted by Panda Boom Amazon FBA Expert

2024 Guide to Amazon Sponsored Products Advertising

Whether you're just starting out with your first product or you're an experienced seller launching your 17th item (like me!), Sponsored Products Ads are a super effective way to show off your brand-new product to potential buyers.

Posted by Panda Boom Amazon FBA Expert

These ads blend in really well with the regular stuff you see when you’re searching on Amazon, so much so that a lot of folks don’t even realize they’re looking at ads.

Actually, they’re the most liked type of ad on Amazon, as we found out in our 2023 Amazon Advertising Report.

For products that are just hitting the market, getting those first few sales can be tough, and it’s those sales that help you climb up in the search rankings. But with Sponsored Products ads, you can target specific keywords and get your product right at the top of the search results from the get-go.

Setting these ads up is a breeze, even if you’ve never dabbled in advertising before. Let’s dive in and explore what Sponsored Products ads really are, how they do their magic, and how you can kick off your very first campaign.

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Diving into Amazon PPC without doing your homework…

Diving into Amazon PPC without doing your homework can really mess things up. It’s like experimenting with your cash on the line—easy to burn through your budget with nothing to show for it.
The damage? Wasted money, lost sales, and a whole lot of regret.
Always better to research deep first.

Posted by: Jacob Carter, 7-figure seller

What’s a Sponsored Products ad, you ask?

Well, think of it as Amazon’s version of a pay-per-click (PPC) ad. You get to bid on specific keywords to get your product noticed right at the top of Amazon’s search results, starting from the very day you launch. And PPC means just that – you only pay a bit every time someone clicks on your ad. These ads are pretty eye-catching because they look a lot like the regular product listings.

The cool thing is, you don’t need any special brand registration to use Sponsored Products ads, unlike some of the fancier ad types like Sponsored Brands or Sponsored Display ads.

That’s probably why they’re super popular – about 75% of Amazon’s third-party sellers use them. Even though sellers are starting to try out other kinds of Amazon ads, Sponsored Products ads are still the big player, making up 79% of what sellers spend on Amazon ads overall.

Where do you spot Sponsored Products on Amazon?

They’re pretty easy to spot because they pop up at the top of the search results, on the right, at the bottom, and even on the product detail pages.

If you’re not really looking for it, Sponsored Product Ads can look a lot like the regular listings. They show up above and to the right of the regular stuff, but they’re quietly labeled as “Sponsored.” You might even find them on the pages of competing products.

Sponsored Product Ads are everywhere on Amazon, making them a goldmine for sellers. It’s like customers can’t escape them; they’re even on the product detail pages! These ads are a big deal because they catch the eye of tons of potential buyers, seriously boosting sales.

When you use Amazon Sponsored Product Ads, you’re putting your products right in front of folks who are ready to buy. They’re deep into shopping mode and know what they want, which means they’re more likely to snag what you’re selling. Keep in mind, this is all about Amazon’s pay-per-click (PPC) system. That means you’ll be bidding against other sellers to get your ads in front of those eager shoppers. The cool part? You get to choose how much you’re willing to pay for each click, giving you plenty of control over your advertising budget.

Amazon Sponsored Products will pop up only if you own the Buy Box.

Just like everything else on Amazon, there’s a lot of competition for it. The Buy Box is that key spot on a product detail page that kicks off the checkout process.

Most shoppers click to buy from there. If you’re the top dog according to Amazon at the moment, your product lands in the Buy Box. And if you’re in the Buy Box, you’re likely selling more than anyone else for that product. If there are a few top contenders, Amazon will rotate who gets the Buy Box spotlight.

Getting the Buy Box usually means you’ve got a solid selling track record.

Here’s the scoop on what Amazon looks at to decide who gets the Buy Box:

  • Your track record for successful sales
  • How many positive reviews you’ve racked up
  • Whether your prices are competitive
  • How you handle shipping and delivery
  • Making sure you’ve got enough stock
  • The freshness of your product

Integrating PPC campaigns into your Amazon strategy is crucial for upping those sales…

Integrating PPC campaigns into your Amazon strategy is crucial for upping those sales. But here’s the deal: you’ve got two choices—either dive in and learn the ropes yourself or outsource to someone who knows their stuff.
The third option? Well, that’s the express lane to burning through your cash without seeing any returns

Posted by: David Perkins, Amazon FBA expert

So, how do Sponsored Products ads actually work?

It’s pretty straightforward and it’s all about the pay-per-click (PPC) game.
You’re basically in a bidding war with other sellers to grab the attention of shoppers. You get to pick how much you’re willing to shell out for each click on your ad, giving you the reins over your daily ad budget.

Here’s the rundown:

you start by picking a bunch of keywords or products that you want your ad to show up for in Amazon’s search results. You’re aiming for shoppers to think, “Hey, this is exactly what I was looking for!” and click on your ad to check out your product.

Next, you tell Amazon your max bid per click—this is you throwing your hat in the ring. An algorithm then juggles all these bids and figures out where to place your ads on the search results pages.

Sponsored Products ads are sneaky:

they blend in with the regular search results. You might spot them at the top of the search page, mingling with other products further down, or even on your competitor’s product pages.

If you’re willing to bid more, you could snag a prime spot right at the top of the search results, where everyone’s bound to see it. Bid too low, though, and your ad might not make it to the stage.

And here’s the deal:

the moment someone clicks on your ad, you pay up, based on your bid. It doesn’t matter if they end up buying your product or not, the click is what counts.

Heads up for the 2023 scoop:

On August 16, Amazon dropped the news that Sponsored Products ads are making their way to some cool spots like Pinterest, BuzzFeed, Hearst Newspapers, Raptive, Ziff Davis, Lifehacker, and Mashable. So if your ad pops up there, it’ll link right back to your product on Amazon.

And guess what? You don’t have to lift a finger for your ads to show up on these sites. Amazon’s got it all set to autopilot. They’re like, “Just chill, we’ll put your ads where they need to be, based on what the customer’s into, the vibe of the page they’re on, and the budget you’ve already picked for your clicks.”

Want to see how it’s all playing out?

Just check out the Sponsored Products placement report to get the lowdown on how your ads are doing.

Looking for a hand with your Amazon PPC campaigns?

Click here and let our PPC expert take the reins and handle your campaigns for you!

Automatic targeting and Manual targeting

Alright, diving into the world of Sponsored Products, you’ve got two ways to play the game: automatic targeting and manual targeting.

Automatic Targeting:

Think of automatic targeting as letting Amazon be your co-pilot.
You give Amazon the wheel, and they pick out keywords or products to target based on what you’ve got in your product listing.
But hey, you’ll want to make sure your listing is on point with solid keywords to start

With automatic targeting, you’ll bump into four types of keyword matches:

  • Close Match: Your ad shows up when folks search for stuff pretty similar to what you’re selling.
  • Loose Match: Your ad appears for searches that are kinda, sorta related to your product.
  • Substitutes: This one’s for when shoppers are eyeing products like yours but from a different brand.
  • Complements: Here, your ad targets folks checking out products that go well with yours.

Setting up an automatic campaign is super quick, perfect for newbies.
Plus, as time goes by, you’ll gather data to fine-tune your approach.
And, it’s a sneaky way to stumble upon new keywords you might not have thought of.
You’ll see all the targets Amazon picks, how much you’re spending, and what’s bringing in the sales.
Even cooler? You can take your automatic campaigns global, launching them in other Amazon markets.
Amazon handles the currency switcheroo, product matches, and bid suggestions.

Manual Targeting:

Going manual means you’re in the driver’s seat.
You decide on the keywords or products to target. Grab suggestions from Amazon or brainstorm your own. Plus, you can tweak your bids for each keyword.
Use keyword targeting when you’re clued in on the exact search terms your customers use.

Product targeting? Yep, you can do that too.

Go after specific competitor ASINs, categories, brands, or features.
And if you want to mix and match keywords and products, no sweat.
Just whip up two separate manual campaigns.
Manual campaigns come with their own flavors of matches: broad, phrase, or exact.
Pick the one that suits your strategy, and you’re good to go!

Broad, Phrase, Exact

Alright, let’s break down these match types, real easy-like:

  Broad Match:

Think of broad match as casting a wide net.
Your keywords can shuffle around, and folks can toss in extra words too.
Say you’re selling running shoes.
With broad match, your ad could pop up for any search that dances around ” running shoes,” like “running shoes for kids” or ” shoes for running” And it’s not just about the words; it’ll catch things like plurals or short forms too.
But remember, broad match is kinda like fishing in the ocean – you might catch a lot, but it’ll cost you more because it’s, well, broad. It’s less picky, so you’re reaching more people.

  Phrase Match:

Phrase match is like having a favorite fishing spot. Your ad shows up when someone searches your exact phrase, with maybe some extra words hanging at the front or back.
Sticking with our “running shoes”, if someone searches “running shoes for women” or running shoes for men,” your ad is there. It’s all about keeping your phrase together, like a little word family.

  Exact Match:

Exact match is like fishing with a spear – you’ve got your eye on one fish and that’s it.
If your keyword is “running shoes,” then that’s the only thing that’ll trigger your ad.
Nothing more, nothing less. Just “running shoes,” plain and simple.
It’s the most precise way to target, so you’re really zooming in on what you want.

Mixing giveaway campaigns with Amazon PPC?

Mixing giveaway campaigns with Amazon PPC? Game changer.
Targeting a long-tail keyword in both giveaways and ‘Exact’ PPC campaigns boosts visibility like crazy. It’s like hitting two birds with one stone—more eyes on your product and skyrocketing sales.
Trust me, it’s the combo move you didn’t know you needed.

Posted by: David Perkins, Amazon FBA expert

Bidding Strategy Essentials

Alright, let’s chat about your bidding strategy, whether you’re rolling with automatic or manual campaigns. It’s all about how you wanna pay when someone clicks your ads.

So, what’s a bid? It’s basically the max you’re cool with paying each time someone clicks on your ad.

The catch? The actual cost per click depends on the bidding war with your competitors.

Your bid is just the ceiling – you might end up paying less. Let’s say you’re aiming for the keyword “running shoes for women” and you set your bid at 70 cents.

If you’re not the top bidder, that’s what you’ll pay. But if your 70 cents is the king of the hill, you’ll only cough up a bit less, like maybe 65 cents, whatever the next best bid is.

You’ve got three ways to play this game, depending on your budget and how much you want Amazon’s algorithms to chip in:

Dynamic Bid-Down Only:

Amazon’s got your back here. They’ll drop your bid if they think your ad’s not likely to lead to a sale, saving you some cash per click.

Dynamic Bid-Up and Down:

Amazon plays both sides here. They’ll hike your bid up to double if they think your ad’s got sale vibes, but they’ll also drop it if it looks like a no-go. Heads up, this one might be a stretch if you’re watching your budget closely.

Fixed Bids:

This one’s all you – Amazon won’t mess with your bids. They stay put unless you decide to tweak them. If you’ve got a clear cap on what you wanna spend per click, stick to fixed bids or the down-only dynamic option.

  • Amazon will throw in their two cents on what you should bid per keyword.
  • You also have the option to adjust your bids by placement.

Setting Up a
Sponsored Products
Ad

Let’s make setting up a Sponsored Products ad as chill as possible, whether you’re going for an automatic or manual campaign.

Head over to Seller Central, hit the “Advertising” tab, click on “Campaign Manager,” and then “Create Campaign.”

Choose “Sponsored Products”

Fill in the blanks—campaign name, date range, daily budget, bidding strategy, and so on.

For this walk-through, we’re picking a manual campaign.
Decide how hands-on you wanna be with your bids. “Dynamic Bids, down only” is a cool choice if you like having control but don’t want to go overboard with spending.
Pop in a custom name for your ad group to keep things tidy.

Start by naming your ad group something unique.

This will keep things tidy, especially when you’ve got a bunch of campaigns running.
For instance, if you plan to run different campaigns like broad match, phrase match, and exact match for your product, name each ad group after the match type you’re using.
Next up, pick the product or products you’re looking to promote

Decide if you want to target by product or keyword. If you’re just getting started, it’s a good idea to go with keyword targeting.

This will keep things tidy, especially when you’ve got a bunch of campaigns running.

In the keyword targeting section, Amazon will show you a bunch of suggested keywords you might want to target, and you get to pick the type of match. For now, let’s stick to broad match.

Right beside where the suggestions are, there’s a spot for you to add any keywords you’ve found through your own research.
Once you’ve put in your keywords, Amazon will give you a heads-up on the recommended bid for each one.

The suggested bids might be on the lower side, so if you want your ad to show up more, think about bumping your bid up by about 25%, just make sure it fits your budget.

Then, there’s a spot for negative keywords.
These are the words you don’t want triggering your ad.
Maybe they’re not bringing in sales or they’re just off-target.
For example, if a keyword’s racking up clicks but no buys, pop it into the negative list.

That way, your ad won’t show for those terms, saving you from paying for clicks that aren’t working out

Hit “Launch Campaign,” and you’re all set!

Optimizing Your Sponsored Products Ads

Patience is Key:

Chill for at least two weeks before tweaking your campaigns. It might feel like you’re losing cash at first, but that’s just how new campaigns roll.
Hold off on any changes early on. This lets Amazon collect solid data, so you make smart moves later.

Know Your Numbers:

Get your break-even ACoS (advertising cost of sales) sorted. It’s all about how much you’re earning for every dollar spent on ads.
To find your break-even ACoS, subtract your product cost and Amazon fees from your sales price, then divide your profit by your revenue.
Understanding your ACoS helps you decide which keywords to keep and which to ditch.

Automatic Campaign Optimization:

In your campaign manager, check out the performance of your automatic campaign.
Keep an eye on the search terms Amazon targets and the performance of each term.
Hunt down your worst-performing keywords (those eating your budget without sales) and your top-performing ones (low ACoS, high sales).
Move your best keywords to a manual campaign for tighter control.

Manual Campaign Fine-Tuning:

Transfer top keywords from automatic to manual campaigns, ideally using exact matching.
In your manual campaign, focus on managing your spend effectively. Lower bids on underperforming keywords and boost bids on promising ones.
Regularly revisit and adjust your bids, aiming to spend no more than your target ACoS.
Keep this up, and you’ll find your campaign getting sharper and more cost-effective over time.

Conclusion

In the wild world of Amazon, nailing Amazon SEO is like finding the treasure map. It’s how you get noticed, win over shoppers, and make sales.

By fine-tuning your listings and playing by Amazon’s rules, you can rock the e-commerce game. So, don’t forget, in Amazon land, SEO is your secret weapon for winning big.

Maximize Your Amazon Sponsored Ads: 5 Unique Tips for Success

  • Leverage dayparting: Schedule your ads to run during peak shopping hours or specific times when your target audience is most active, maximizing visibility and budget efficiency.
  • Use negative keywords strategically: Regularly update your campaigns with negative keywords to avoid irrelevant traffic, ensuring your ads reach the most interested and potential buyers.
  • Capitalize on A/B testing: Continuously test different elements of your ads, such as images, titles, and keywords, to understand what resonates best with your audience and optimize accordingly.
  • Implement dynamic bidding strategies: Utilize Amazon’s dynamic bidding options, such as ‘bid down’ or ‘bid up,’ to automatically adjust your bids in real-time based on the likelihood of a sale.
  • Optimize product listings: Ensure your product listings are complete, accurate, and compelling, with high-quality images and detailed descriptions, to improve conversion rates from your ads.

Final thoughts

Are Sponsored Products Ads Worth It?

Absolutely! But remember, it’s not a “set and forget” deal. Keep a close eye on your campaigns to ensure you’re not overspending on non-converting clicks. Plus, these ads are known for delivering strong returns on ad spend over a two-week period. Stay engaged, and you’ll likely see the benefits.

 

P.S. If you’re looking for information on Amazon’s sponsored ads or are interested in having our Amazon specialist oversee your campaigns for a more hassle-free experience, feel free to click here.

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