Amazon ads revenue has absolutely exploded over the last 2 years and a lot of brands are thinking of expanding their operations on Amazon. One of the best ways to increase sales on the world’s largest marketplace is to use Amazon ads.
The challenge is that Amazon ads are not the same as Google or Facebook ads. There are different ad types, placements, and strategies that a brand needs to learn in order to be successful on Amazon.
In this episode of our Host The Pro series, we interviewed the Amazon ads rockstar -Destaney Wishon. She’s the CEO of BetterAMS and has managed advertising campaigns for 20+ companies in just the last 3 years.
Here’s the full video interview and a transcript below.
How did you get started with Amazon?
My name is Destaney Wishon, and I'm co-founder and CEO of an advertising agency focused strictly on Amazon ads. It's the only thing that we do, which is a big plus because we can go really deep on it when we're not spread thin across everything else in the industry.
I have been managing Amazon campaigns for five years now, which doesn't sound like a lot, but when you look at Amazon in general, so much has changed over the last few years that it seems like a lifetime ago.
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How Amazon Ads were affected by COVID
In the beginning, the ad platform itself wasn't that developed. You primarily had sponsored product ads, which are the ads that look just like Amazon listings. So that was where everyone focused on. And there wasn't a ton of competition.
So all of these small brands had a big competitive advantage, they were really able to scale quickly. In recent years, and COVID was also a major catalyst of this, we've seen bigger brands use the platform because their retail presence got shut down.
So they had these budgets that were set aside for Walmart and target. And they were like, oh my, my gosh, no one's going into stores. Let's move that to Amazon. So last year alone, Amazon's gotten so much more competitive.
The biggest tip for Amazon Ads
The most important thing is to understand the mindset behind Amazon ads. Facebook and Google ads are more disruptive and those audiences typically have a lower intent to purchase. Users see ads when they are scrolling through their Facebook feed.
On Amazon, because you're serving an ad exactly where someone's purchasing it. It is one of the most powerful ads to bid on across all the ad types. It’s even more powerful than a Google ad because if someone's looking for running shoes on Google, they may be looking for articles, blogs, or YouTube videos.
If someone searches for shoes on Amazon, they're looking at purchasing, but when you understand that mindset, you can actually select your campaigns a little bit better. They're a little bit more valuable.
The biggest mistake on Amazon Ads
One of the biggest mistakes that I see is typically thinking that they can transfer their knowledge from Google or Facebook directly to Amazon. It's just quite a bit different and not as easy a transition as people think.
What are the types of ad campaigns on Amazon?
Here are the different types of ad campaigns you can run on Amazon.
1. Keyword targeting- which is truly targeting the keywords that customers are typing in and making sure your ad shows up there. There’s also have
2. Product targeting - which means you can target all of your competitors’ products with an ad that's going to show up on the detail page.
3. Sponsored products - which look just like an organic listing.
4. Sponsored brands - where you can write a copy, have a creative and include multiple products. They're typically the ads that show up at the top of the page that every consumer sees.
5. Display / DSP - these are ads that most people are used to. You can target shoppers by demographic information, interests, different audiences. These are broader campaigns and you tend to see them the most on Amazon.
What is the most effective strategy for Amazon Ads?
The most effective strategy is starting with sponsored product ads because they get 70% more placement than any other ad on the platform. When you type in a keyword in Amazon, you're gonna see more sponsored product ads than anything else.
They tend to be less competitive, you can win more placements and you get more exposure. They look like organic product listings so customers click on them more.
How Amazon Ads affect organic sales
Something that goes understated in Amazon is organic ranking and the Amazon flywheel. The beautiful thing about bidding on any keywords is the more conversions you drive from that keyword, the better your organic ranking is going to be.
So not only do your Amazon ads just increase your sales, but they also increase your opportunity to get more organic sales. Something we always recommend is doing your keyword research and then bidding on those keywords.
How important are Amazon reviews?
Reviews play a really important role in anything you're going to be doing with ads because they affect your conversion rate. If you have three reviews and your competitors have 300 reviews, you're not gonna have as much brand trust as your competitor. So your conversion rate may not be as high.
When you're driving more traffic that's not converting well because of poor reviews, you're just wasting more money. So we always recommend starting with a strong foundation, getting reviews, and then driving more traffic.
But on the flip side, you know, the beautiful thing about Amazon ads is they can drive more reviews because you're driving more traffic to your product listings. So if you're not showing up on page one for your top keywords, customers are not going to see you. They're not gonna go to pages two and three. So you need to run ads to get your listing onto page one.
Should I sell on Amazon or on my own eCommerce store?
When people look at Amazon, they typically see their poor margin and that's the one thing that stands out. They think - “my website has amazing margins and Amazon has terrible margins”.
What eCommerce owners miss is that Amazon has 90x more traffic than your website will ever have. So it's just economies of scale. You maybe have less margin on Amazon but you're selling more units. So your profit may end up being more, especially if you can get to page one.
So your brand presence on Amazon definitely makes a big difference. You need to have that kinda synchronicity across both sites.
And I don't think it's a competition between the two. Amazon is valuable because customers trust it. And there's so much traffic. Your website's valuable because every customer who really loves your brand may still end up on your website, especially if you’re great at winning that person over and really driving loyalty.
So you can do both of these channels. It's not one or the other.
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The disadvantages of selling on Amazon
There is a trend in the last two years or so of brands that used to be solely on Amazon, building their own brand. They are building their own acquisition flow and increasing their brand equity. They’re doing that because there are several disadvantages of selling on Amazon.
Don’t put all your eggs in one basket
It's scary when your whole business is in the hands of Amazon, we've all seen it. Amazon comes in launches the same product in your own category or Amazon decides to decrease shipping limits. And now everyone on Amazon is stuck with a bunch of inventory because they can't ship it.
Speaking of Amazon copying your product, here’s a famous video of the brand Peak Design calling out Amazon Basics on doing just that.
You don’t own your customer data
Having little control over your brand is a scary thing. Another reason why most people are diversifying is that Amazon doesn't give you a lot of customer data, which can be kind of scary. You can't actually see who your consumer is.
So I think that's the biggest reason people are diversifying, due to that risk. It's also just incredibly beneficial for your customer to see your products on both Amazon and your site and to go into a retail store. In the long term, it's the best play.
That's why Coke's name is anywhere and everywhere. They didn't choose one platform. They want their customers to see them and really know that they're accessible through any marketplace.
How to take your Amazon ads to the next level
Use video search ads and optimize them with keywords. Also, use lifestyle images for your product pages. Focus on telling your brand story in every ad and use those influencer shots and UGC, and use Amazon influencers. Your brand story becomes your biggest competitive advantage so put some time and resources into it.
Amazon ads is a super important acquisition channel for any eCommerce brand out there. Amazon can help you scale your business and grow your brand (through the shoppers that find you on Amazon and then visit your website). Be sure to test out all the various ad types (sponsored products, sponsored brands), and optimize your product listings.
Want to scale your brand on Amazon?