How to optimize your advertising investments on Amazon

Advertising on Amazon is a way to acquire new customers by highlighting its products. It calls for targeted and thoughtful investments.

Far from contenting itself with highlighting the products of third-party sellers, Amazon offers brands and merchants all the advantages of an advertising network to promote their products and services online. “We are accelerating the development of brands on and off Amazon,” boasts Stéphane Grenier, director of Amazon Ads France. Its team follows several thousand companies in France and abroad, including so-called non-endemic brands. Coming from sectors such as automotive, financial services, hospital or travel, they do not sell directly on Amazon’s marketplace but use its advertising services.

Sponsored investments

Among the seven advertising formats made available by the Seattle company, which we have already presented to you, some will prove essential for third-party sellers who want to boost their sales on the marketplace. The objective of third-party sellers will be to position themselves at the top of the results pages responding to customer queries. “We have two types of formats that appear on our search results pages, the most relevant natural results and the limited locations for sponsored links, explains Stéphane Grenier. Natural referencing is determined by the relevance of the product, its quality, its sales volumes, page traffic and customer reviews”.

To recover the limited locations, the nerve of the war is the purchase of keywords which is played by an auction system: “The winner is determined by the relevance of the brand, the traffic it generates and the rates of conversion combined with auction values”, continues Stéphane Grenier. It is a second price auction, whoever wins the bet pays the price of the second highest bid. The auction price, from a few cents to several euros, will depend on the category in question, the competition, the seasonality.

Different strategies

“”We change our keyword buying rules every 72 hours”

Anthony Raia, Amazon Ads manager at Krooga, an agency that supports SMEs on Amazon, indicates that you must regularly optimize your keyword purchase campaigns: “From the start, the seller will have to test as many keywords as possible by as little time as possible, then he should check regularly and cut short very quickly when a keyword does not work”. Specialized agencies automate their campaign management. “We change our rules every 72 hours, explains Julien Tarzia, Amazon Ads expert at eTail, an agency specializing in brand support on Amazon. We will look at when we broadcast during the day and our market share on such keyword If a product is already high in organic, we don’t add paid to it, we keep this budget to increase other products”.

In campaigns, different objectives are pursued by the purchase of keywords. There is the defensive strategy: “If on a range I have a product that works very well, I will buy keywords for my nine other products so that they also go up and take up space”, explains Anthony Raia of Krooga. Sellers can also target keywords on which their competitors are positioned or complementary keywords to their main keywords.

Indicators to watch

For the purchase of sponsored positions, via the sponsored product or sponsored brand formats, the return on investment is measured at cost per click. “With sponsored links, we position ourselves closer to the act of purchase, these formats are more efficient because they target a specific audience”, comments Julien Tarzia of eTail Agency. Stéphane Grenier, the director of Amazon Ads, advises to monitor the cost per click: “If the ROAS or return on ads spend is important because it highlights the value of sales for each euro invested, the cost per click is also to compare the effectiveness of different keyword bids”. Alongside these sponsored formats, there are DSPs or demand side platforms, a format that allows you to reach an audience outside of Amazon. “It’s about retargeting, the objective is to seek audience elsewhere and redirect it to the product available on Amazon”, specifies Julien Tarzia of eTail agency. Billing is done in CPM or cost per thousand impressions. On video formats, the indicator to watch is the VCR or video completion rate.

Don’t ignore reviews

The task is not easy for a newcomer to the Amazon marketplace, “the seller will have to calculate his margins well and will not directly earn money, observes Anthony Raia at Krooga. He finds his rhythm of sale after six months to a year, he has to be patient and put money into advertising.” But before looking at advertising, opinions are also crucial. “Even if the seller has a good product catalog, he must collect opinions to know if his product is interesting and sticks to the marketplace. His product must find its place through natural referencing”, adds Anthony Raia. For Krooga’s Amazon Ads manager, “a competitor who already has 5,000 reviews is almost irretrievable”. He advises using the Amazon Vine service, Amazon’s tester club through which the merchant can send around thirty products to testers who will give their opinion. This service costs 180 euros per referral.

To be accompanied

To succeed, Julien Tarzia, Amazon Ads expert for eTail Agency, advises to name your campaigns well, to determine your budget by product. “But, if we are positioned on 200 keywords, and we do everything by hand, it takes time, hence the interest, to surround ourselves with teams internally or by outsourcing. An agency will have a expertise on Amazon Ads, she has automation tools that she will mix with her experience, but also, relationships with Amazon that will allow her to learn more about trends and new products,” he adds. . For Anthony Raia de Krooga, “by going through an agency, we avoid a certain number of errors. An Amazon account is blocked very easily and it is robots that manage the unblocking and with whom you will have to negotiate. At a minimum, if you don’t get support, you have to train through Amazon University,” he concludes.

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