Are you planning on running ads on Amazon, but don’t know how? Check out the process with this quick guide on building a competitive Amazon marketing campaign!
Tips to Build a Competitive Amazon Marketing Campaign – A Definitive Guide
Marketing is the core of your sales, especially on a huge e-commerce platform like Amazon. Your business will stand out based on how well you present your products and respond to your target audience’s needs. A good Amazon marketing campaign may define your success in selling on the platform.
You might have already searched high and low but still haven’t found the right guide to help you how to build a competitive marketing campaign. Don’t worry, this article tackles more than the basics of building a strategy that works; rather, we will talk more on applying these strategies so you can finally see if these tips are working for you. If you’re looking forward to learning how you can apply these tips to your current marketing plans, read on to know more.
Understanding Advertising Cost of Sale (ACoS)
Building a competitive Amazon marketing campaign requires you to understand technical terms. Knowing these terms and their relevance to your campaigns are important steps if you want your strategies to succeed.
One term you’re most likely to come across is the Advertising Cost of Sale or ACoS. This is a metric that tells you how well your Amazon Pay-Per-Click (PPC) campaigns are doing; it is the ratio between your ad expenditure to your ad revenue. The ACoS is a mathematical term that will give you a value. This will signify if your Amazon store is profitable based on the advertisement you’ve put out.
To give you an idea, the formula for computing ACoS is:
ACoS = ad spend ($) / ad revenue ($) x 100%
Say you’ve spent $100 on an advertisement and you were able to generate $500 worth of sales from that particular ad alone. Plug in the values to compute the ACoS value.
ACoS = $100/$500 x 100% = 20%
How is this relevant to your business?
This means you’ve spent 20% of your total sales to fund your Amazon ads. A good ACoS value should be around 15% to 20%, but the working average is 30%. So with the calculated ACoS above, you can say that you have a good ad spend and return ratio. The rule of thumb is that the lower your ACoS values are, the better. It makes sense because a low percentage would mean you’re spending less money on Amazon PPC, but you’re getting more sales in return.
You can use these ACoS values to make business decisions and a strategic growth plan. Selling on Amazon is not just about working on optimizing your listings or creating products that stand out, it’s also knowing how to interpret what the numbers are saying. A good marketing strategy is data-driven and not based on hunches. So if you’re committed to making a fool-proof Amazon campaign, you have to understand the technicalities that come with it.
There are many ways on how you can build a competitive Amazon marketing campaign that works for you. But sometimes, it’s a lot easier said (and planned) than done. So here are seven sure-fire steps you can do today to kickstart a marketing strategy that will allow you to convert leads into sales.
- Ensure that your listings are optimized
Before running Amazon marketing campaigns, you must first ensure your listings are optimized. Search Engine Optimization (SEO) is a technique Amazon sellers use to get their listings to rank and show up on the first few pages. As a seller, you must prioritize optimizing your listings. The higher your rankings are, the more visible your products will be.
What’s better is that the audience who enters these keywords is actively searching for products to buy. The interest from your audience is already there; you have to stand out from the rest of your competitors. You have to make it enticing enough to make your audience want to buy from your store instead of others. Even if your products are privately labeled, you still have to integrate the right keywords on your listings. Aside from ranking up, optimized and well-written listings are part of how you can protect your brand on Amazon.
Keep in mind that the keywords you have on your listings are where your campaigns are anchored. So if you want your marketing strategies to succeed, you must first start with properly optimized product listings.
2. Organize your marketing campaigns
If you are selling more than ten products, organizing your Amazon marketing campaigns is a recommended practice. Logically grouping them can help you keep track of their performance. There are no set rules on how you can organize your marketing campaign. You can arrange them any way you like: similar group products, keywords, brand, or by sales volume.
If you’re testing your keywords out with automated campaigns, you won’t find the need to group them. Instead, Amazon will identify it for you depending on your title, descriptions, and other details included in your listings.
Manual campaigns work best if they are organized since running these ads requires more work than usual. Advertisements from manual campaigns require daily monitoring, and you have to adjust your bids depending on how the keywords are performing. Keep in mind that even if you have grouped products, you may still change your bids per product listing.
3. Test automatic targeting before running a manual campaign
Contrary to popular belief, you might think automated ads perform better than manual ads on Amazon. It might work for some, but there’s no guarantee that it will work for everyone. However, it is tempting to run automated ads since it’s a lot easier—set up the ad campaign’s details, along with your budget and its duration, and you’re good to go. In addition, you can now attend to other aspects of your business that need attention.
In terms of running an Amazon PPC strategy, you shouldn’t think “out of sight, out of mind.” Instead, you should check your campaigns daily to see how well they are performing. While it’s true that both types of campaigns have their own sets of pros and cons, you can further maximize it by using both. For example, you can run a manual campaign but test them first with an automated one.
You may use the data collected from testing automated campaigns, such as keyword research, and apply it to the manual ones you’ll run next. These keywords can help you target the specific terms you want to rank for. Running an automatic campaign first is helpful, especially if you still don’t have keywords to work with just yet.
4. Adjust your bids accordingly
Since you may group various products in a single ad campaign, they most likely differ in profit margins. So it won’t make sense to shell out an equal amount of ad spend on a $5 and a $25 item. Although these products may be grouped, adjusting your bids depending on the ad’s performance allows you to maximize your ACoS values.
Aside from basing your bids on the products’ profit margins, you may adjust it depending on how well the keywords perform. Some keywords, even though they were generated from automated targeting, have poorer performance than others.
Pro tip: If you have just rolled out a new marketing campaign, you will have to set your bids higher compared to when you’ve been running them for quite some time. This is an effective strategy so you can first gain search history. Failure to do this will prompt Amazon to give preference to other senior campaigns with better sales track-records. After you’ve gained traction, you can start lowering your bids.
5. Utilize long-tail keywords
You are going to encounter two types of keywords to use on your listings. These are short and long-tail ones. Long-tail keywords are longer keywords that make product targeting more specific. These usually comprise more than three keywords put together.
For example, a short keyword phrase is “tumbler,” but if you want to be more specific, you can target a longer keyword with “liter tumbler for exercise” or “best insulated tumbler for cold drinks.” Although some may say it’s better to target phrases with one to two high-ranking keywords, it also pays to be more specific. You’re not going to replace all the keywords in your campaigns with long-tail ones. Rather, you’re going to add them as your targets instead. This is a superb strategy, especially if you sell other types of tumblers.
Using long-tail keywords can also show your ads for more relevant and related searches. Even though long-tail keywords have fewer searches overall, people who search with these terms have higher buying intent. These people know exactly what they want; hence, they are very specific with their search terms.
6. Add negative keywords to be more specific
Most guides or articles you may find for proper keyword usage on Amazon mainly focus on targeting phrases you want to rank for. However, you shouldn’t only focus on these “positive” keywords. If you’re going to make the most of marketing, you should also learn how to use “negative” keywords to your advantage.
Negative keywords are phrases for which you don’t want to rank or be searchable for. Now, you might think that taking this step is completely unnecessary but adding a negative keyword to your ad campaign also makes a lot of sense. You’ll realize how helpful targeting negative keywords are for you, especially if you sell a relatively common product.
For example, you sell cosmetic products such as foundation, lipstick, and mascara, but you don’t sell make-up tools such as beauty sponges or make-up brushes. Therefore, the keywords you want to rank for are “cosmetics,” “make-up,” or “make-up products” since individuals who search for these terms are most likely looking for make-up products, not tools. Your negative keywords can then be “make-up tools” or “make-up brushes.” With these, you are targeting the specific keywords you entered for your campaign, and not for other related products that you may show up for.
Aside from specificity, adding negative keywords to your campaigns can help lower your advertising costs. Lower ad costs with better ad revenue can significantly improve your ACoS values.
7. Work with an Amazon advertising agency
Whether you’re a new Amazon seller or not, it’s best to work with an advertising agency. These are professionals who know how the platform works. Given their extensive knowledge, skills, and experience, they know how to execute marketing plans properly.
You may find working with a marketing agency helpful, especially if you’re not familiar with how running campaigns on Amazon work. Unfortunately, most sellers, including you, don’t have time to learn how to set up the campaigns. Although there are several crash courses and manuals you can watch or read online, these are not enough to know everything there is to know about it.
Setting up campaigns on Amazon is not exactly easy to learn, and with ads, you want to make sure you get them right the first time around. You’re not only investing time and effort in making these campaigns you’re putting out a substantial amount of money too! There’s not much wiggle room for mistakes so instead of doing all of these on your own, work with professionals who can get ads up, monitor them, and increase conversions for you!
Selling on Amazon is one of the best business moves you can do to grow your brand. This is true especially nowadays as most consumers opt to buy goods online rather than going out to get them. The website traffic is already there—you have to find a way to get your target audience to your listings and to buy your products! You can achieve this by planning and executing an effective Amazon marketing campaign.
Outlined above are the seven ways on how you can do this. If you want to stand out from your competitors, increase brand awareness, and drive views to your listings, advertising is the way to go. Apply these marketing strategies and start growing today!
Jayce is the managing director of Seller Interactive, the number one Amazon advertising agency based in Canada that helps brands build their business on Amazon. His content marketing expertise has led him to work with brands such as Toyota and GoDaddy, producing content that has reached over 20M views in a month.