News & Insights
Build your Brand with Amazon Sponsored Display
Most Amazon sellers know that the platform’s search algorithm is crucial to their brand’s success. But few realize there is more to the formula than getting in front of the right customers quickly. Staying on a shopper’s radar throughout the decision-making process is often just as important. In fact, Amazon’s research has shown that only four percent of shoppers buy a product after their first search. Instead, it can take them an average of 6 to 7 days to make a purchase.
One of the most effective ways to avoid losing prospective customers during this purchase journey of comparisons, evaluations and distractions is to utilize Amazon Sponsored Display advertising. When used correctly, this specialized Amazon tool can reach the relevant shoppers at the most critical points of their search and substantially boost conversions for an Amazon seller.
Types of Amazon advertising
Before diving into the details of how Sponsored Display ads can support a company’s growth, it’s essential to understand that this feature is just one of several Amazon advertising initiatives available to brands and how each option differs from the others.
The origins of this Amazon advertising began in late 2019 when the site launched Sponsored Display ads, a self-service advertising solution available via both Vendor and Seller Central. A Sponsored Display Ad was unique from other Amazon product display ads in that it could reach targeted audiences on and off the platform. In 2020, Amazon expanded the offering to include the enhanced targeting of Sponsored Display Audiences. The advertising options have continued to evolve in recent years, and the services available to companies enrolled in Amazon Brand Registry are now simply known as Sponsored Display.
Similar to Google Adwords, A Sponsored Product ad is targeted using keywords and (ASIN) to reach Amazon shoppers. They allow advertisers to promote specific products within Amazon’s search results and product detail pages. They are the most popular form of advertising on Amazon.
These ads are intended to support brand building by featuring multiple products from a single company. Appearing above search results, Sponsored Brand ads display a custom headline, logo and up to three products. Clicking on this type of ad typically sends shoppers to an Amazon Storefront or custom Amazon landing page. A video version of Sponsored Brand ads is also available to promote a product detail page.
The Demand-Side Platform (DSP) advertising from Amazon can be confused with Sponsored Display since it similarly offers the ability to target audiences on Amazon as well as other sites. However, Amazon DSP is not restricted to brands selling a product on Amazon and can therefore be used by brands hoping to draw shoppers away from the site. DSP advertising also requires a much more significant advertising investment and is sold based on the number of impressions the ads receive rather than when a user takes the extra step to click on the pitch.
Amazon Video Ads
With the growing popularity of streaming television services, Amazon also offers video ads that attract advertisers interested in reaching audiences unrelated to its dominant marketplace. These ads appear on the company’s TV properties, including Freevee, Twitch, live sports on Prime Video, top TV network and broadcast apps, and the News app on Fire TV. In addition, sales of out-stream video Ads on Amazon subsidiaries like IMDb and other sites can also be purchased in multiple delivery formats.
Amazon Audio Ads
Amazon audio ads are 10 and 30 seconds commercials that play periodically between songs on Amazon Music’s free ad-supported tier. These can reach mobile and desktop users, as well as customers relying on Alexa-enabled devices like the Amazon Echo or Fire TV and give advertisers an opportunity to connect with customers beyond their screen time.
Advantages of Sponsored Display
The attraction of Amazon Sponsored Display advertising is mostly due to the visibility it offers brands and the targeting that can be done when creating a campaign.
Unlike Sponsored Brands and Sponsored Products which are limited to appearing on the Amazon marketplace, Sponsored Display ads may appear on and off Amazon. Ultimately, where these ads show up will depend on the parameters of the ad campaign.
On the Amazon site, ads can display on product detail pages, next to customer reviews, under a featured offer or within search result pages. Outside of the marketplace, Sponsored Display ads may also reach audiences on mobile apps and third-party websites that have a relationship with Amazon.
Another bonus of Sponsored Display is that they include the visual elements that Amazon shoppers are accustomed to and trust. Since they are based on product listings, they feature images, star ratings, Prime badging, and prices directly from Amazon. In addition, they typically feature a shop now button that leads directly to the product detail page.
A key benefit of Sponsored Display advertising lies in the targeting options. Amazon divides this ability into two areas. Advertisers can create a targeting strategy based on a similar product or relevant product category or choose to focus on specific types of audiences.
By targeting competing or complementary products for Sponsored Display ad delivery, brands can capitalize on the opportunity to reach shoppers who are likely to have an interest in the product but may not realize it exists. Promoting product awareness and accelerating product discovery in this way can be a powerful way to connect with shoppers efficiently.
Sponsored Display product targeting can be done in one of two ways. Advertisers can select specific products that are listed on Amazon and target the shoppers browsing those items. Companies can also opt to target product categories for a broader approach to reach a larger swath of prospective customers.
Sponsored Display audiences campaigns are designed to reach shoppers based on their behaviors and preferences, and not just when they’re on Amazon. Rather than limiting the display ads to the search results and detail pages of specific products, advertisers can use Amazon audience targeting to engage or reengage prospective customers. These tactics targets shoppers who have previously viewed relevant products and categories or attempts to introduce an item to new customers who are likely to be interested. Amazon allows brands to create custom-built audiences or use pre-built audiences, depending on the goal of the Sponsored Display Campaign.
The custom-built options offer detailed refinement of these remarketing efforts. It is a marketing approach that targets users primarily on historical purchase behavior. Purchase remarketing can drive repeat purchases or cross-sell to existing customers by focusing on audiences who previously bought the same or complementary products. Views remarketing is similar, but rather than targeting past buyers, it homes in on shoppers who have viewed particular items but not yet purchased them. These custom-built tactics can also be improved by utilizing Amazon’s “Lookback windows” to designate the time period when the initial consumer purchase or view occurred, up to 90 days in the past for views remarketing or a full year before when utilizing purchases remarketing.
Amazon’s pre-built audience targeting offers brands thousands of segments to help them target new customers based on their interests and behaviors. These are grouped into four major categories to simplify the process of building an effective campaign. In-market segments are shoppers who are currently shopping in a selected product category. Lifestyle segments can be used to target customers who exhibit behaviors that map to identities such as “foodies” or “sports enthusiasts” based on shopping, browsing and streaming history. Similar to lifestyle targeting, interest segments drill down more specifically to a single interest. Meanwhile, life event segments are also available for companies interested in reaching customers based on things like a marriage or the birth of a child.
Sponsored Display costs
The cost to run a Sponsored display campaign will vary greatly depending on the number of products being advertised, the target audiences and the budget options that are chosen. For example, sponsored Display advertisers can opt for a cost-per-click (CPC) model, where advertising costs are only incurred when someone clicks on an ad, not when they see it. Or they can choose to pay by cost-per-thousand viewable impressions (vCPM), calculated by how often an ad is displayed to a shopper.
In addition, sellers must set a daily budget cap for Sponsored Display campaigns and choose a maximum bid that can be used to purchase available ad slots. Typically a new campaign will start with a $1 bid for CPC and a $5 bid for vCPM, with plans to monitor and adjust as the effort progresses. Both CPC and vCPM bids can also be optimized for impressions, page views and conversions depending on a company’s goals and preferences.
Setting up a successful Sponsored Display campaign
While success with a Sponsored Display campaign depends on many factors, including planning, familiarity with Amazon’s targeting options and the products being promoted, the steps to create a campaign are relatively simple.
- Choose a campaign name – It’s best to use something straightforward that reflects the advertised product, including the Amazon Standard Identification Number (ASIN) and the campaign goal. This approach can make it easier to differentiate among multiple campaigns in the future.
- Select the start and end dates – While campaigns should be reviewed regularly for effectiveness, Amazon recommends leaving end dates open to avoid an abrupt end to a campaign and ensure that product sales data are appropriately attributed.
- Set the budget – Campaigns require a daily budget that can be adjusted at any time. Expect to spend $40 per day or more to start with for a campaign with the reach necessary to achieve noticeable results. If a daily budget runs out, the ads will stop displaying until midnight when it resets.
- Create an ad group – Ad groups allow you to organize multiple campaigns that use the same targets. This can make it easier to manage and monitor the performance of advertising efforts.
- Choose your targeting tactic – As discussed earlier, any Sponsored Display add must opt for either a product or audience targeting approach.
- Add the products to advertise – Choose one or more products from your lineup to add to the campaign. If a product is out of stock or loses the buy box to an alternative seller, the ads will no longer display to shoppers.
- Optimize the bid strategy – The final step before launching a campaign is to select a bid strategy. Brands must choose between CPC and vCPM billing methods and the optimization goal that best fits their campaign.
When to use Sponsored Display
It’s common for brands to consider Sponsored Display to advertise established products, but new products can also benefit from a well-designed campaign. The targeting capabilities can allow companies to reach the buyers and shoppers of complementary products or introduce the item to audiences that are likely to be high-interest customers.
Furthermore, a campaign that uses product targeting to increase traffic and audience targeting to remarket to those visitors can be an extremely effective approach to launching a new product and ramping up sales quickly.
Sponsored Display can benefit both large and small businesses due to its targeting and cost flexibility. It can increase brand awareness and accelerate conversion, with adjustments available to emphasize either or a multi-pronged approach to do both. A Sponsored Display campaign also offers metric reporting that can be used to improve current advertising and inform decisions about future campaigns, Amazon optimization and even product improvements.
Make the most of Sponsored Display
Amazon Sponsored Display offers brands a powerful tool to enhance advertising campaigns, expand the marketing funnel and drive greater revenue and profits. For Amazon sellers and vendors, Sponsored Display can be used alongside Amazon Sponsored Brand purchases, Sponsored Products ads, and listing optimization to promote products efficiently. However, success requires a solid foundational strategy and a commitment to ongoing improvement.
One way to increase the effectiveness of a Sponsored Display is to add 10 or more ASINs to the campaign. Having a variety of products will result in more impressions and better data to evaluate the performance of the ads compared to each other, which can reveal strengths and deficiencies.
It’s also critical that you contribute an appropriate ad spend to any Amazon display ads. Campaigns that run out of budget before the end of the day will be challenging to evaluate and adjust effectively. Comparing the effectiveness of Sponsored Display, Sponsored Brands and Sponsored Product ads simultaneously can also be helpful. Using similar targeting strategies and budgets across these types of sponsored ads can provide valuable insight.
Finally, it’s important that the data that Amazon makes available from its advertising solutions and listings is used to guide future advertising decisions and set campaign goals. Remember to experiment with different targeting tactics and review all of the metrics to identify what’s working and what isn’t. But be careful not to react too quickly. Instead, give ads multiple days or weeks of impressions before making adjustments. Similarly, novice campaigns often need as much as three months of tweaking to begin producing the desired results.
Amify can help
Don’t let the learning curve of Amazon Sponsored Display keep your products from reaching their full potential. Our Amify experts are ready to help your brand navigate the complicated world of targeting, optimization, data analysis and content creation. Trust their knowledge and experience to build the right Amazon ad mix for your products, and enjoy the results you’re seeking sooner, with less frustration, and at a lower cost than you thought possible. Contact us today to learn more.