One of the most exciting parts of being an Amazon seller is launching a product. It means that you’ve done it! You did the research, sourced a product, and now you’re ready to introduce it to the world. So, pat yourself on the back. For many, myself included, whenever I reach this point I’m constantly asking myself, “is this product going to succeed?” Fortunately, it’s easy to launch a product successfully using the right launch strategy. If you’ve been following the Jump Send blog, you probably already know about promotional launches using Jump Send, but today I wanted to go over another important element of an effective Amazon launch strategy: Amazon PPC.
Amazon PPC: Table of Contents
- What is Amazon PPC?
- How much does Amazon PPC cost?
- When should I start using Amazon PPC?
- What is a good strategy for Amazon PPC?
- How can I track my Amazon PPC costs?
- How do I start an Amazon PPC campaign?
- Which Amazon PPC campaigns should I start with?
- How do I optimize Amazon PPC campaigns?
- How do I do keyword research for Amazon PPC?
- What other types of Amazon PPC campaigns are there?
What is Amazon PPC?
Amazon PPC stands for Amazon pay-per-click advertising. Pay-per-click is a form of advertising where each time one of your ads is clicked on, you pay a pre-determined bid amount. Many search engines utilize pay-per-click advertising methods because of its efficiency and effectiveness.
By contrast, PPM is a method of advertising per impression. So, instead of paying per click, you would pay per a set number of impressions, typically 1,000.
As an Amazon seller, you can create Amazon pay-per-click campaigns for your products by targeting specific keywords. And if you have a brand registered product, you will have even more options available to you for advertising on Amazon.
How much does Amazon PPC cost?
Amazon PPC is pay-per-click advertising. Therefore, you pay each time a shopper clicks on your ad. How much you are charged per click depends on a multitude of factors. First, you are the one that sets your maximum bid per keyword (or all keywords, if running an automatic campaign). Second, what you are charged also depends on what your competitors are bidding.
Additionally, you can set a daily budget for your bids. Once your budget for the day runs out, your ad will no longer show.
Now, keep in mind, you are charged regardless of whether or not the shopper makes a purchase. Therefore, it is up to you to optimize your listing to ensure high conversion rates.
What is a conversion rate?
A conversion rate is a digital marketing metric that takes the number of people who’ve purchased your product and divides it by the number of people who’ve actually visited your page (in marketing, these are called “impressions”). The higher conversion rate, the better. For example, if 10 people visit your product page and only 1 buys, then your conversion rate is 10%.
When should I start using Amazon PPC?
Most Amazon experts will tell you that it’s best to start Amazon PPC campaigns right from day one. Using Amazon PPC not only helps get your product in front of more shoppers, but it also tells Amazon’s search engine algorithm that your product is worthy of notice, therefore relevant.
However, there is a fine balance to strike with Amazon PPC. You don’t want to spend too much and just throw money carelessly at ads. Nor do you want to play it too safe. First, we recommend that you start with an automatic campaign at $25 per day in daily budget with bids around $1.50. After a week or so of doing this, you can scale up or down as needed.
I go into more detail about this later in this article.
What is a good strategy for Amazon PPC?
The best strategy for Amazon PPC is to do the following:
- Start slow with a limited daily budget and reasonable cost-per-click for each ad campaign (between $1 – $2).
- Create both automatic and manual campaigns alongside product launch promotions.
- Run weekly reports and highlight high converting keywords.
- ABR – always be researching. Continue to search for new and better long tail keywords.
- Remove keywords that aren’t converting and promote keywords that are.
- Keep your Amazon ACoS at 25% or lower.
- Use Amazon accounting software to track your actual advertising costs.
What is Amazon ACoS?
Amazon ACoS stands for “actual cost of sales.” ACoS is a percentage calculated by taking the actual ad spend for a single product’s advertising campaign and dividing it by the total sales of that product derived from the ad campaign. The lower your ACoS the better. For example, if you spend $40 in ads and earn $200 in sales from those ads, then your ACoS will be 25%.
How can I track my Amazon PPC costs?
The easiest way to track Amazon PPC costs is using Amazon accounting software. Once upon a time, Amazon made it a whole lot easier to track your day to day ad costs in the reports section. Unfortunately, they’ve changed the way reports work, so it can be hard to determine advertising costs… that is until the moment that Amazon hits you with a $500 charge for ads.
For my money, the best Amazon accounting software out there is Fetcher. Fetcher actually integrates directly into Amazon Seller Central and pulls all of the relevant data and sorts it in a series of attractive bar, pie, and line charts.
Now, instead of using a calculator and/or a spreadsheet to estimate what your Amazon PPC costs are, Fetcher does all the work for you. All you have to do is log in and check your dashboard.
How do I start an Amazon PPC campaign?
The process for creating a sponsored product Amazon PPC campaign is simple.
Here are the basics:
- Login to Amazon Seller Central.
- Click on the Advertising > Campaign Manager menu option.
- Click the big, orange “Create Campaign” button.
- Supply the campaign settings page with the following information, then click “Continue to next step.”
- Campaign name. What do you want to call your campaign?
- Daily budget. What is the most you’re willing to spend per day on ads?
- Start/End dates. When will your campaign start, and when (if ever) will it end?
- Targeting type. There are two types of Amazon PPC targeting options.
- Manual targeting. These are keywords you target specifically.
- Automatic targeting. These are keywords that Amazon targets on your behalf and optimizes.
- Name your ad group. Within your campaign, you can name your ad group, too.
- Choose the products you wish to advertise. We recommend one per campaign.
- Enter your default bid. What is the most you’re willing to bid per click? (Likely between $1 – $2 for most products)
- For manual targeting, enter your keywords. There are two ways to do this.
- Suggested keywords. These are keywords that Amazon thinks are appropriate for your product.
- Provide your own keywords. These are keywords that you’ve researched yourself.
- Click “Save and finish.”
Which Amazon PPC campaigns should I start with?
We recommend the following program for product launches, combining both Amazon PPC ads and product launch promotion campaigns.
- Create a product launch promotion. The easiest way to do this is through creating a promotion in Amazon Seller Central, then advertising your promotion on an Amazon deal site like Jump Send. This will help Amazon know that your product is relevant. Additionally, it’ll help you get early reviews and allow your product to rank well.
- Run an Amazon PPC automatic campaign. During your product promotional campaign, start an Amazon PPC automatic campaign, too. This early campaign will allow Amazon to help you identify high converting keywords. I recommend starting with keyword bids around $1.50-$2.00. You will want to run this type of Amazon PPC campaign for at least a week.
- Use the data from keyword research to create your first manual campaign. You’ll want to add in any keywords that you discovered through running Amazon keyword reports (see below) plus any you found using sites like keyword.io to your manual campaign and start bidding on those keywords.
Once you’ve got the hang of the basic Amazon pay-per-click campaign types and you’ve got a brand registered product, you might want to try some of the other, intermediate Amazon ad campaigns types like headline search ads and display ads (see below).
How do I optimize Amazon PPC campaigns?
The best way to optimize Amazon PPC campaigns is through running regular reports, performing excellent keyword research, and making small adjustments week over week. Again, this is not something you want to rush, nor is it something you want to shy away from. Sometimes, it can take as long as 60 days to fully optimize your Amazon PPC campaigns. And even then, you will want to continue to update and tweak those campaigns for as long as your product is available on Amazon.
How do I do keyword research for Amazon PPC campaigns?
There are two simple ways for performing Amazon keyword research.
Method #1 – Create an Advertising Report through Amazon Seller Central.
This is probably the most effective way to find keywords for your manually targeted Amazon pay-per-click campaigns: by finding out which words are actually landing you sales.
Here’s how do this:
- Login to Amazon Seller Central.
- Click on the Reports > Advertising Reports menu option.
- Select the following information:
- Report type should be Keyword.
- Report name can be whatever you want it to be.
- Report period should be the longest period possible. Later, you might try running keyword reports with shorter periods.
- Data unit should be Total.
- Click the “Create Report” button.
- Download the CSV report. It may take a moment for Amazon to create it.
- Open the CSV in Excel.
- Organize the keyword data by “Conversion rates within 1 week”
- Highlight or copy all of the keywords with high conversion rates. I recommend 10% or higher for most products. If your product has a higher sales price ($40 or more), then you might go for a lower conversion rate milestone.
- Paste those keywords into a notepad document or directly into your manual campaign.
Method #2 – Use keyword research tools to find long tail keywords.
Next, in addition to the high converting keywords that you’ve discovered with your Amazon keywords report, you can also find more long tail keyword opportunities using tools on the web.
Some of my favorite keyword research tools include:
- KWFinder. This tool is optimized for bloggers more than anything, but can still be useful for Amazon sellers.
- Keyword.io. This tool actually has a specific option for Amazon.
- Sellerwords. This is another cool tool specifically for Amazon sellers. It uses reverse ASIN lookup tech.
- Google Keyword Planner. Finally, a tool that a lot of sellers swear by, Google’s own keyword planner can help you come up with some awesome long tail keywords.
What is a long tail keyword?
The phrase “long tail keyword” refers to keywords that are more specific or niche than their “short neck” counterparts. Usually, a long tail keyword phrase will contain 3+ words, versus 1-2. Therefore, long tail tends to have fewer searches, but also fewer competitors, thus lower costs. Additionally, long tail keywords tend to have higher buyer intent, which means higher conversion rates.
For example, if you were going to sell a funny hat that looked like a cheeseburger, if you bid on short neck words like “hat” or “funny hat” you could pay as much as $3-$5 per click. However, if you bid on long tail keywords like “hat shaped like cheeseburger” or “big cheeseburger hat”, the costs would be less.
What other types of Amazon PPC campaigns are there?
In addition to the manual and automatic Amazon PPC campaigns described above, you also have options with Amazon Marketing Services (AMS). These campaign options include Headline Search and Product Display ads.
What are Amazon Headline Search Ads?
A headline search ad is an Amazon PPC campaign that automatically takes three branded products and places them into a banner on the search page. Typically, the banner will be above all other search results (including other sponsored ads) and include information on the brand, ratings, prices, and even a custom tag line that you can create.
Here is an example of a Headline Search ad:
Headline search ads are only available to sellers who have at least three products under an Amazon registered brand. You can create headline search ads on Seller Central under the Advertising Campaigns menu selection, or through the AMS subdomain.
What are Amazon Product Display Ads?
A product display ad is an Amazon PPC campaign that inserts advertisements directly into other product pages. It is an effective way to advertise your product listing on a competitor’s product page. Typically, the ad appears just below the Buy Box.
Here is an example of a Display ad:
Much like headline search ads, display ads are an Amazon PPC campaign that you can only have access to if your product is a registered brand on Amazon. You can only create display ads on the AMS sub domain (https://ams.amazon.com).
So, that’s it for Amazon PPC basics. Of course, not every campaign is the same. Depending on your own costs and product needs, you may have new and different challenges of your own. Regardless, be sure to follow the basics. First, always make sure that you’re doing plenty of research (ABR!). Then, run regular reports to see how your ads are doing. And finally, keep using product promotions and new types of advertising campaigns to continue to boost your sales and rankings.
For more information on launching a successful Amazon product promotion alongside your Amazon PPC campaigns, check out Jump Send. It’s the #1 way to launch a product on Amazon.