Mastering The Amazon Advertising Opportunity

Fred Seddon, Manager, Strategy Group

For brand marketers, Amazon Advertising presents a huge opportunity — if they can learn to use it well.

Amazon has already gained a strong reputation in the marketplace as a place to direct digital ad spend, as a provider of  proprietary high-value inventory with proven levels of segmented reach, and highly optimizable tiered targeting.

The company has worked to put its ad-tech offerings on par with other major players, reorganizing and streamlining, upgrading usability and UI, improving its API, and adding consulting services for major buyers and brands.

Amazon DSP, now hooked into all the major advertising exchanges, last year surpassed Google’s competing offerings to become marketers’ top choice DSP, according to a survey of marketers by Advertiser Perceptions.

That helped Amazon increase ad sales 95% to $10 billion, more than three times forecasts, according to Ad Age’s Garett Sloane. Amazon, he says, “is building an ad platform to compete with Google and Facebook.”

Amazon’s inventory set provides billions of monthly pageviews across the desktop and mobile sites plus its apps and feeds and connected devices. In the U.S., alone, there are more than 200 million monthly unique visitors on Amazon.com, according to comScore, each of whom view an average of 60 pages in that month.

And, of course, Amazon has unparalleled proprietary data on consumers’ shopping and buying patterns. Through its platform, brands have the chance to place paid messages in front of both a highly specific and highly scalable set of consumers, across all screens.

Accessing The Inventory

Still, brand managers excited about the possibilities Amazon Advertising presents are also confronting the unique approach it requires of their brands if they are to maximize the benefits.

For example, Amazon’s advertising algorithms use the content within product pages on its e-commerce platform — which this year will surpass 50% of U.S. shopping online — as a significant determining factor to  who wins ad placements in the advertising inventory it controls.

For search ads on Amazon, the most prevalent type of ad buy there, a strong CPC bid is simply not enough to win; its algorithm also evaluates factors on product pages such as consistent and clear language, correct spelling and grammar, use of illustrative visuals, customer reviews, as well as more nuanced minutiae. Even factors outside of the control of media agencies, such as shipping availability, or consistency of fulfillment to Amazon warehouses will play a factor in advertisers’ success with the platform.

Brands that don’t invest time and resources in the Amazon’s sales platform  can find themselves ceding control of their brand to third-party sellers, who are free to sell and represent the product in the way they choose, absent the involvement of the manufacturer.. Those third parties can sometimes misrepresent a brand, or provide a poor purchasing experience, potentially endangering the value of the brand and its relationships with its consumers.

Working With The Right Partner

Brands are also learning that the benefits of working closely with Amazon Advertising go well beyond securing good ad placements, furthering purchases online and protecting their reputations.

A brands’ product pages and the paid messaging on the platform not only drive success on Amazon.com, but can also increase brand lift and intent to purchase offline. While Amazon is making headlines around the globe, we as marketers must bear in mind that e-commerce still amounts to only about ten percent of consumer purchases. Especially in fast moving categories like CPG/FMCG, the value of Amazon as a research platform and as a branded experience cannot be overlooked.

Amazon is rapidly changing the marketing landscape across all categories – even including verticals that you might not expect, such as FinServ, and Automotive – and many brands are trying to get up to speed on best practices in the platform as quickly as possible. To help, I’m proud to say that we at Xaxis have written a research white paper on maximizing outcomes through Amazon Advertising.

We are one of the few advertising organizations working with Amazon to help develop their suite of products and services, ensuring they deliver what we and our clients need most in easily usable and highly streamlined ways.

For a brand, selecting the right activation partner is crucial to securing the necessary expertise, experience and relationships to take full advantage of  the best programmatic advertising capabilities Amazon has to offer.

That partner must be able to incorporate Amazon’s siloed media  buys not only with an omnichannel, cross-platform marketing strategy, but also with the greater fulfillment and consumer research ecosystem that the platform. Only a truly integrated and knowledgeable partner can navigate the many disparate disciplines required to achieve success on the platform.

Done right, advertising through Amazon delivers results that reach much further than the bounds of e-commerce, and can drive lasting, impactful results for advertisers of all verticals in all phases of the consumer journey.

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