9 Common Questions (And Answers) We Get Asked About Amazon Sponsored Products

February 20, 2017

Marketplaces Laura Lane By Laura Lane

In 2015, the number of sellers using Amazon Sponsored Products worldwide grew more than 100%, with over 20,000 sellers in the EU using the program. It’s no wonder that these paid advertising options are growing in popularity – with millions of retailers and billions of products on Amazon, it can feel near-impossible for retailers to stand out from the crowd.

As a retailer – you should be asking yourself if using Amazon Sponsored Products could help give you a boost to stand out from your competitors.

Here’s what you need to know about Amazon’s famous advertising program:

  1. What are Amazon Sponsored Products?

Sponsored Products is an advertising program that helps you promote the products you list on Amazon.co.uk.

They are pretty similar in structure to Google’s AdWords campaigns. You choose which products you want to advertise, assign keywords to those products, and enter a cost-per-click bid. When an Amazon shopper searches for one of your keywords on Amazon.co.uk, your ad then becomes eligible for display alongside the search results. You pay a fee for this program only when an Amazon shopper clicks on your ad, at which point the shopper is taken to the detail page where your offer is listed.

  1. What’s the ad format?

Sponsored Product’s ad format is cost-per-click, using an auction-based pricing model. You set the maximum cost that you are willing to pay when a shopper clicks on your product ad. The more competitive your bid is, the more likely your ad will be displayed when an Amazon shopper searches for one of your keywords.

  1. What are the benefits of using Sponsored Products?

There are many benefits to using Sponsored Products, but if we had to choose just four, how does discoverability, more sales, relevance and program transparency sound?

  • Discoverability: You’ll have improved visibility with the opportunity to get your listings on the first page of the Amazon search results.
  • More sales: You’ll reach a highly qualified audience that is low in the purchase funnel.
  • Relevance: You’ll deliver highly relevant ads targeted to customer searches.
  • Program transparency: You’ll be able to measure ROI and then optimise ad spend based on your findings.
  1. Do I need to be Buy Box eligible?

Sponsored Products is only available to sellers who are Buy Box eligible. Ads appear on search or product pages when the seller is winning the Buy Box – they do not appear when you are not winning the Buy Box.

  1. Where will my ads show up?

Ads can be displayed in six primary areas; below organic search results, along the right rail, on the product detail page, on smartphone and tablets, in the mobile app or at the top of search results.

  1. Are Sponsored Products helpful if you’re the only seller for your ASINs?

Yes. You must have the Buy Box to win the bid. And if you’re the only seller, you’ll always have the Buy Box! Sponsored Products will help boost the ranking of your items by allowing you to bid on search terms that give you placement on the first search page on Amazon.co.uk. Over time this visibility will drive traffic to those items, increasing the overall rank of your listing.

  1. Which products should I advertise with Amazon Sponsored Products?

This is dependent on you and your business’ goals. You can set up campaigns for all or just a subset of products. For example, some sellers use Sponsored Products to showcase new offers, new brands and product line extensions and new features. Others want to give increased visibility to unique selections, offers with low glance views, clearance items, top sellers or seasonal promotions. Basically, there are countless reasons why you should use Sponsored Products as part of your marketing mix — and it’s up to you to determine the strategy that makes the most sense for your business.

  1. What sort of budget should I set?

It may make sense for you to start small when setting your daily budget when kicking off your campaign. You can always add to your daily budget if you keep running out of money. This will allow you to control ad spend and ensure you’re seeing results as you spend.

  1. Any advice on getting started?

When you set up your campaign, you’ll also be asked to select a targeting type (automatic or manual targeting). The easiest way to get started with the program is by selecting automatic targeting. It will provide you with eligible keywords for your selected SKUs. Automatic targeting is designed to generate more search traffic to your ads because Amazon targets them to all possible relevant searches, based on your product information.

This is a great way to get started if you’re not sure which keywords to use, when you want to save time on creating new ads, or if you want to learn which keywords generate the most traffic to your ads. Then, once you get a good idea of what keywords are triggering your ads and how they’re performing, move those high performing keywords into their own manually targeted campaign. You’ll be able to manage your bids more closely and have much more flexibility.

Amazon can be an amazing channel for reaching new consumers. But it can be hard to make your products stand out when there’s stiff competition. It might be worth experimenting with Sponsored Products to give your visibility a boost.

Got more questions about Sponsored Products, or want to hear about more ways to succeed on Amazon? Why not email us on ukteam@channeladvisor.com and we’ll be happy to help. ChannelAdvisor is hosting its annual Catalyst Europe event in Manchester on 16 May 2017. Check out the Catalyst Europe website to book your tickets.