While creating an Amazon store is simple, gaining exposure and customers takes time. This is why the best way of selling fast on Amazon is using Amazon advertising campaigns. Unfortunately, whether you choose product display ads or pay-per-click (PPC) ads, Amazon PPC marketing is currently bigger and more competitive.
With Amazon ad sales surpassing $2 billion, Amazon has shown consistent growth over time. However, this means that selling on Amazon is becoming more competitive and tougher. Adopting the right strategy is important if you want to outrank other Amazon sellers. Below are tips for optimizing paid ads to grow your Amazon business.
1. Set up structured ad campaigns
The best place to begin optimizing our Amazon ads is by setting up a structured ad campaign. A structured ad should have campaigns for every product category and specific ad groups under the campaign. For example, if you sell women sportswear on your Amazon store, begin by creating ad campaigns for the best-selling products, such as:
- Women’s swimsuits
- Women’s track pants
- Women’s sports bra
- Women’s sports sunglasses
You should then create individual ads for these specific categories in every campaign. For instance, in the first campaign, you can have several ad groups, such as women swim caps, women swim shirts, or women swim shorts. You should then research relevant keywords for individual ad groups.
2. Understand the flywheel effect
You can also optimize ads and grow your Amazon business by understanding and taking advantage of the Flywheel marketing effect. The Flywheel effect is primarily a paid advertising concept used to breed earned media and drive business growth. Paid and earned media include reviews, page views, and orders. On the other hand, product content is your owned media.
The strategy behind the Flywheel effect is quite simple. Rolling out paid ads increases traffic to specific product pages, improving product position in organic search results. Increased traffic coupled with favorable product position in organic results increases the chances of the product joining the “Amazon’s product choice” category.
Having products with the “Amazon’s Choice” label means that the products will get more attention from shoppers, further increasing traffic, and the cycle goes on. You should regularly measure performance using various business metrics to capitalize on the Flywheel effect.
However, you shouldn’t rely on Advertising Cost of Sale or ACOS to measure business success. Instead, you should base your business success on the gross profit, total revenue, and the Total Advertising Cost of Sale (TACOS). Fortunately, Amazon attribution has made it easy for sellers on the platform to gather these metrics.
3. Eliminate unwanted search queries
You should also eliminate unwanted search queries to reduce advertising costs. Like Google ads, Amazon ads are not always displayed for the exact search query terms sellers bid on. Customer search queries might differ from the keywords depending on what they are looking for. To reduce unnecessary costs, you can either:
I. Set keyword specific match types
When setting up paid ads on Amazon, you can choose from either of the following match types;
Broad match – If you choose this option, product ads are displayed for search queries with words or phrases in the keyword. The order of words, spelling variations, synonyms, and misspellings doesn’t matter.
Phrase match – Here, the product ad only appears if the search query includes your chosen keyword(s) in the exact order. Close variations, either singular or plural variations, are also considered a match.
Exact match – Product ads only appear if the search query exactly matches the keyword used.
II. Set negative keywords
Amazon has also made it possible to create negative keywords to enable sellers to reduce wasteful ad expenditure. Creating negative ads means that your product ads won’t appear for search queries with your selected keywords. Negative keywords options include:
Negative exact – Here, sponsored product ads will be excluded if the customer’s search query matches the negative keywords chosen or with minor variations.
Negative phrase – Product ads won’t be displayed if part of the customers’ search query has the selected negative keyword.
When searching for negative keywords to filter, prioritize keywords with a lot of traffic but very few conversions. This means that you have been paying for ad clicks that don’t convert into actual sales. Such keywords are often too short or general. Online shoppers typically look for specific products, which can be targeted better with long-tail keywords.
Endnote
Paid ads optimization essentially involves making adjustments to your paid ads campaigns. PPC optimization should begin with measuring the performance of your current campaigns and identifying areas that need improvement. Monitoring your campaign results, specifically the impact of slight changes can help identify effective optimizations that improve your ad performance.