There’s a lot of talk in the market right now about – will it be Amazon or will it be Google? This isn’t the first time we’ve heard such chatter, back in 2010 people were asking will it be Facebook or will it be Google and what we learned from that experience is that it can be both. As a result, more than likely we’ll simply see Amazon added as a third strand to the current Google/Facebook duopoly. Find out more..
The question is whether there is room, will Amazon not simply eat into the ad budgets for the two channels. The truth is there will be one real loser in the scenario, that is traditional media.
The budget to fund your Amazon campaigns must come from somewhere, Google is pretty accountable in terms of its function in driving sales and Facebook is getting better at showing how it drives sales so its value is established.
Traditional media on the other hand is notoriously loose in terms of how it accounts for ROI. Of course, it can be done correctly but that kind of large scale quantitative and qualitative research is both time consuming and expensive and may not seem worth the effort vs. downloading a csv or reviewing a dashboard from a digital channel.
Before we predict the demise of traditional media, let’s look at the drivers of the budget shift to Amazon in particular.
Relentless.com
Back in 1994 Jeff Bezos, Amazon’s founder registered the domain Relentless.com. If you type this into your internet browser, it re-directs you to Amazon. This type of thinking sets the precedent for what Amazon is all about.
Cynicism aside, it demonstrates the core values of Amazon and how it has gone from 1990s online book merchant to the everything store and potentially take enough stakes in all commercial walks of life, to become everything-everything (not the band) in our daily purchase lives.
That’s the thing, Amazon is a retailer or marketplace facilitator of commerce/sales so before we get ahead of ourselves thinking it will take over all marketing from Google Facebook and traditional media, we must understand its core function – direct eCommerce sales. Now we must understand people and consumers.
At present, we don’t live in a world where people are buying all the time, every second of the day is not a covert marketing message to coax consumers to buy everything from computers online to chain saws in discount European retail outlets – people do spend time doing other non-consumer things.
In the case of Google & Facebook, people search for information and ideas using search engines or share and browse content on social media, while their actions are interrupted by YouTube pre-rolls, Facebook native ads, banner/display promotions or paid search advertisements.
This is why Amazon is different. The user has a different mindset.
The Consumer Mindset
Fact is, no one goes to Amazon to browse content, they go to Amazon for a simple commercial purpose. They are there to buy something, this is the consumer mindset which Amazon has access to. This is what makes Amazon so attractive to businesses.
So much so that the users are so far down the conversion funnel you are greeting them at the till! In time Amazon may add more top of funnel features to their platform to compete with the awareness and consideration functionality of Google & Facebook, as well as the conversion territory in which they are all currently competing.
Ad Formats on Amazon
As native or part native internet users and marketers, we are familiar with the standards of web advertising; innovative as Amazon is, it hasn’t swayed too far from what we generally see as tried and tested web ad formats. Let’s take a look at some promotional tactics on Amazon.
Buy Box
Being in the Buy Box is a pre-requisite for advertising on Amazon, if you’re not in the Buy Box, you can’t advertise. There are a number of things businesses should do to ensure they get in the Buy Box, most of this is straightforward so follow these guidelines.
Firstly, you need to have a Professional Seller Account or Pro Merchant Account in the EU. This is a plan for retailers which can be purchased from Amazon here: https://services.Amazon.com/ . Then you can link your eCommerce product inventory via a feed from your website to Amazon and start selling.
Next up you need to ensure you are selling in stock items that are new. It is possible to sell used/second hard items on Amazon but that’s in a different buy box. Focus on New, in stock items to advertise effectively. Out of stock items will not be shown in the Buy Box.
Much like Quality score in other channels, you account needs to have positive historical account performance to be considered for inclusion in the Buy Box.
Amazon looks at your feedback score, shipping methods, price and delivery speed to understand your account performance. Once you start to appear regularly in the buy box you can consider what type of advertising to utilise.
The Platform Options
The two main platform options are Amazon Marketing Services (AMS) and the Amazon Advertising Platform (AAP). The first option, AMS is more of the self-serve Google Ads style platform using Keywords, product or interest-based targeting on Amazon and to serve display ads. Depending on whether you are an Amazon Vendor or Amazon Seller, there are different advertising options available to you on AMS.
What’s the difference between the Amazon Seller and Amazon vendor categories you may ask? Vendors are large manufacturers or whole sales who sell directly to Amazon, you are essentially an Amazon supplier – this is an invite only option. Sellers are those who wish to use Amazon’s platform to sell their goods, similar to an eBay store. You are not selling directly to Amazon, but you can use Amazon’s platform to sell your products to Amazon customers for a fee.
The second advertising option (AAP) is for larger ecommerce outlets, you need to spend a minimum of $15,000 per month to available of this part managed service (it’s done through an Amazon representative/account manager). There are more options and support available to advertisers on AAP and this is also Amazon’s programmatic offering.
Ad Options: Sponsored Product Ads
This is the most straightforward and impactful option in the beginning. These are sponsored products that appear above and below the organic product results and on product pages themselves in Amazon’s search feature. These ads are triggered by keywords and contain an image, product star-rating, price and other product details.
It is recommended that when beginning a Sponsored Product Ad campaign, you should run your campaigns on auto-targeted option for at least 2 months to see the types of search queries that Amazon users input into the search bar to find your product.
Importantly, this increases your visibility and allows you to get a deeper understanding of the types of searches that people perform on Amazon as opposed to Google/Bing etc.
Note: It’s also possible to bid on competitor terms so to protect your brand visibility, it’s always worthwhile running some brand activity on Amazon.
Ad Options: Headline Search
These are top of funnel ads used for brand and product category awareness. Advertisers can serve ads containing up to 3 products at any one time to showcase their offering at the top of the Amazon search results page for a category.
When people click through they are brought to a branded landing page which showcases the advertiser’s products.
It’s recommended that you use some of the best performing keywords and searches from your Sponsored Product Ads to trigger your Headline Search Ads too.
Ad Options: Product Display Ads
This ad format is exclusive to direct suppliers of Amazon, i.e. Vendor Central merchants. These are interest based visual ad formats which show up on product pages, near review of other products or your own products to encourage people to purchase.
These ads are intended to be high impact direct response display ads in key locations in the Amazon conversion funnel to drive sales.
Conclusion
Amazon is a great tool for eCommerce vendors, though this may expand to other types of products in time. It allows you to diversify your media budgets and resources away from other channels to drive incremental returns for your overall bottom line.
At the moment, it’s in the early stages so there is an opportunity for early adopters to capitalise on the new market place as an accompaniment to their existing digital marketing strategies.