Your listings are doing good business, but you’re convinced they could be doing better. You’ve been working hard on all the little things to improve your rankings, you’ve got good reviews, everything is going well, but how could it be better? The answer, as with all the most frustrating things in life, is that it depends. It is possible that using Amazon’s sponsored product system could work well for you. There are a whole bunch of factors to consider before deciding that’s the way for you to go, however, so let’s take a look at some of them.
Obviously, Amazon isn’t going to advertise your product for free, which means you need to decide if the cost is worth it. With Amazon you pay per click, which is pretty standard for online marketing, and with Amazon you bid on the keywords in your listings. If you are the highest bid, say $.60 per click, and a competitor bids lower, say $.55 per click, you will only be paying that $.55 per click despite your bid being $.60.
There are different types of advertising, you have close match, which is when a customer searches for your exact keyword. Loose match, which is related terms and longer phrases including your keywords. Substitutes, which is where your product is advertised as an alternative to a product a customer is looking at. And finally, complements, which is when your product is advertised as being a good fit along with something a customer is looking at (the frequently bought together option when you’re looking at a product). Each of these options results in a different number of clicks, which is something that you need to consider in your marketing budget when you choose to use Amazon’s product advertising.
There are also different options for your bid. There is dynamic bid-down only, which will allow your bid to fluctuate, but only down in price. There is dynamic bid-up and down, which allows your bid to fluctuate up and down, which allows you to ensure your bid will always be the top for your keywords. There is also static, where your bid does not change. With any of these bid types it is necessary to monitor your bid to ensure you are staying within your marketing budget, but also that you are maintaining your keyword.
Finally, there is one more way to manage your keyword bid, and that is with either manual or automatic targeting. This is where you allow Amazon to which keywords you’re targeting with automatic or you choose everything yourself with manual.
All of the above gives you a ton of space with which you can customize your Amazon advertising approach, which allows you to tailor your approach to your marketing budget. So that leaves the question of how much return you can see on your marketing budget. According to JungleScout’s 2021 Amazon Advertising Report, product advertising on Amazon has an average 30-Day RoAS (Return on Ad-Spend) of $4.85. So for every dollar you spend on product advertising with Amazon the average return is $4.85.
There are obviously other factors at play than all the stuff with bidding and keywords and such. All of that is largely useless if your listing isn’t perfected. You can see previous entrees in this blog for tips on how to do that. It’s also crucial that you have good reviews, because they drive sales. If you’re advertising a product with an average two star rating you won’t convert that to sales because potential customers will be put off by the atrocious reviews. So make sure the product you’re advertising is a product that is actually worth advertising.
The answer to the question that led you to this blog, is product advertising on Amazon worth it, is still frustratingly answered with, it depends. Though in many cases, assuming you’ve done the work necessary to make product advertising worth it then product advertising will be worth it. It is not, however, a solution to the ills of your Amazon listing, because it will only exacerbate them. It is very much an amplification of what you are doing with your listing. If your listing is excellent then advertising it gets that excellence in front of more eyes, which allows you to convert more sales. If your listing isn’t good, then no amount of advertising can save it.