A Beginner’s Guide To Setting Up Your First Amazon PPC Campaign

Around 63% of people rely on Amazon for online shopping. Additionally, more than 79% of brands have agreed that PPC marketing campaigns are their main business-driving force. These two facts alone outline the crucialness of Amazon’s paid marketing strategy for boosting a business’s sales. Plus, not everyone is fond of using organic online visibility-enhancing techniques, especially when their end goal is attaining quick results in a short time.

But how to begin with leveraging this advertising strategy? This question is probably arising in your mind right now. Fret not! We are here to guide you through everything related to Amazon PPC advertising management. From what exactly an Amazon PPC campaign is, how beneficial it could be for you, what different ad types are available, and how to begin with Amazon advertising, we will discuss it all.

What Exactly Is An Amazon PPC Campaign?

It’s basically an Amazon platform-based paid marketing strategy using which businesses can display their products and services on and off Amazon by paying an amount of money. Being a pay-per-click (PPC) form of advertising, sellers only need to pay when a user clicks over their featured ads. It’s more of a click-based deduction form of advertising and not just a pure impression-based one. As a seller using this marketing mode, you get complete control over which keywords you want to target.

How Does Amazon PPC Work?

As a pay-per-click (PPC) mode of advertising, an Amazon PPC bid strategy allows you to bid on a selected set of keywords related to your offered product or service. Despite looking straightforward, it’s quite a powerful and highly effective tool using which sellers can secure more sales for themselves. Amazon in this instance works like an intermediary between you and the ultimate buyer. Plus, the scope of brand building is also quite higher than what you get in other paid marketing campaigns like that of Google Ads.

Have a look at the following to better understand how exactly Amazon PPC works:

• A user searches for a particular product on Amazon. Let’s say “shampoo.”
• Now Amazon gathers all relevant ads for this set of keywords searched.
• After that, sellers have to make a bid on this searched phrase. Whosoever makes the highest bid wins the conducted auction.
• The winner’s sponsored product ad gets featured in search results based on the used phrase.
• Whenever a visitor/potential buyer clicks on that featured ad, the merchant/seller gets charged a particular fee.

Common Amazon PPC Advertising Terms You Must Know

For those who have just gotten started with their first PPC advertising campaign, knowing the basic acronyms and industry jargon is a must. Doing so aids them in being fully capable of optimizing their ad campaigns on their own after understanding the basics. To make it convenient for you to do so, here are some of the most common terms related to Amazon PPC that would prove useful to you while optimizing an Amazon PPC campaign:

• CPC (Cost-Per-Click): It’s the amount that you’re charged when someone clicks on your ad.
• CTR (Click-Through Rate): It’s a measurement denoting the amount of people who clicked on your ad out of all the people who saw it.
• ACoS (Advertising Cost of Sales): It’s a metric that shows you exactly how profitable your ads are. For it, your total expenditure on ads is divided by the generated revenue from the actual clicks.
• Impressions: They denote the number of times your ad was displayed over a while for a particular search query.
• Bid: It’s the amount that a seller/advertiser is willing to pay for a particular or a set of keywords.
• Campaign: It’s a set of ads having a common budget, objective, and optimization strategy.

How Much Does Amazon PPC Cost On Average?

The exact cost to be incurred for an Amazon PPC campaign varies depending on numerous factors. Generally, these factors include competition, keywords, bidding strategy, product price, and conversion rate. Still, you can expect to pay anywhere between $0.05 and $10 per click, with the average CPC being around $0.95. An important term that you need to be aware of alongside CPC while running an Amazon PPC ad campaign is ACoS (Advertising Cost of Sales). ACoS is more of a refined metric as compared to CPC. It denotes your Amazon pay-per-click (PPC) advertising campaigns’ performance and measures your advertising costs as a percentage of your total sales revenue. A sound ACoS generally falls between 10% and 35% but is subject to your product and industry.

Pros Of Having An Amazon PPC Campaign

There are numerous ways in which an Amazon PPC campaign can benefit your business. Being a click-induced marketing method, you need not burn your marketing budget, as you get charged only if someone clicks on your featured ad. You get to feature your product/services right in front of a buyer who’s already motivated. Here’s a brief on how Amazon PPC could benefit you:

• Improved Brand Awareness: PPC campaigns can help your customers better recognize your brand and products.
• Increased Visibility: Using PPC ads, you top the search results, and your products become more visible to potential customers.
• Increased Sales: PPC campaigns are an effective way to drive suitable traffic to your product listings that can lead to more sales.
• Cost-Effective Advertising: It’s a cost-effective mode of advertising as you only pay when someone clicks on your featured ads.
• Better Scalability Scope: Based on your business goals, you can scale your campaign size.

Ad Types For Amazon PPC Campaign

For your Amazon PPC campaign, you get to choose from innumerable ad-type options. Possibilities for it include brand stores, video ads, audio ads, Amazon attribution, Amazon DSP, product display, headline search, and custom ads. However, the main ad product types are sponsored products, sponsored brands, and sponsored displays. Read on as we uncover all of them one by one:

1. Sponsored Products

This is the most commonly used ad type that most Amazon sellers/merchants use. They are seen in shopping results/search results and product detail pages. Carrying an almost identical outlook to organic product listings, these ads barely affect a shopper’s experience. You must have noticed a “Sponsored” tag alongside the featured product listings that appear in results as a part of advertising. These are the sponsored products. This ad type is beneficial for those who want to promote individual products.

These ads are capable of automatically generating ads from your product listings and have an automatic targeting feature as well, making campaign creation an easy task for beginners. This is a pure cost-per-click (CPC)–based advertising model wherein a seller is charged only when a customer clicks on their ads. One gets complete freedom over what amount they are to be charged for each click as facilitated by their feature of setting their bid amount.

When beginning with Sponsored Products ads, you get two options: automatic campaigns and manual campaigns. Here’s how they differ from each other:

• Automatic Campaigns: This is more of an Amazon-handled campaign setup. The platform uses its algorithm to assign keywords and targeting expressions to your products. This way your product gets featured in relevant search results and product pages on its own, without you needing to employ much manual effort. For those looking to swiftly set up an ad campaign for themselves, they can go with this method.

• Manual Campaigns: Those finding it a bit handy to create an ad campaign can go with setting up a manual campaign. Under it, you get complete control of choosing the keywords and targeting expressions. Being more of an advanced campaign setup, you can even choose the match types for keywords for your products.

Benefits Of Sponsored Products

• By targeting specific keywords, sponsored product ads can give you tremendous results within a short period.
• The scope for brand awareness is quite high in these ads, as shoppers are directly channeled to your product detail page, wherein they can learn more about your offerings.
• Sponsored product ads send your listed product directly to a buyer who is already searching for your product, resulting in an increased probability of securing higher click-through rates.

2. Sponsored Brands

Earlier known as “headline search ads,” sponsored brands are great for those looking to boost their brand awareness, as using them, you can conveniently expand your offering’s reach to target new audiences. As customizable ads, you get an opportunity to show your creative side by adding either a custom headline or a video. Using it, you can feature multiple products in your ad.

Your showcased products and Amazon storefront ads are displayed in four different regions: on top of search results, within shopping results, on the homepage, and on product detail pages. By featuring your customized headline, videos, or images, you make it easier for a potential buyer to choose your product over the competitor’s. Plus, you also get a bit of freedom regarding product and keyword targeting, but you need to do them manually.

For Sponsored Brand ads, you get to choose from three types of format options that are given as under:

• Product Collection: You get to target up to three products at once. It’s up to you whether you want to direct the traffic to your branded Amazon store or a dedicated landing page. Irrespective of the choice made, again you can target up to 3 products only.

• Store Spotlight: Under it, you can target up to three particular product categories at once. This is a great option for brands dealing in multiple categories or subcategories spanning across multiple products.

• Videos: Another option under the sponsored brands ad type is video ads. By creating a video that adheres to the Amazon Sponsored Brand video ad guidelines, you can get increased exposure and brand awareness for yourself. Using it, customers can easily access your store or product detail pages. The video ad appears at the bottom of the search results page.

Benefits Of Sponsored Brands

• As quoted by Amazon itself, Sponsored brand ads can increase your return on ad spend (ROAS) by 5.5% when used alongside store spotlight, sponsored brand videos, and customized image ad formats. Furthermore, it can even help you increase your conversion rates by up to 57.8%.
• It’s a great advertising measure to encourage buyers to add complementary items to their cart.
• You can direct shoppers to your store page or a custom Amazon landing page.

3. Sponsored Display

This ad type blends both a cost-per-impression model (CPM) and a cost-per-click (CPC) model. Some people even refer to these ads as purchase-intended ads, as they most probably appear at the bottom of the “Add to Cart” button on Amazon product detail pages, alongside and below the search results pages, and on customer review pages. But that’s not all for their prevalence, as these ads also appear on platforms other than the Amazon store. They can appear at places like Netflix, Facebook, Google, and other mobile phone apps as well. 

This mode of advertising is great for attracting potential customers who have already shown interest in the past. You get to choose the products that you want to promote and can set up a daily budget and bids as well. As a programmable self-service PPC ad type, it also features a customization feature that allows you to update your campaign based on your assessment of the audience’s preferences.

For the product display ads, you get to choose from the two following targeting options:

• Contextual Targeting: This is good for those who want to promote their selected product or a product category to visitors who have previously shown interest in buying their stuff. Based on keyword matching and content analysis, the ad appears in relevant context only. Areas where this ad can appear include the Amazon store itself, third-party websites, and apps like Facebook, Twitch, etc.

• Audience Targeting: Through it, you get to choose a specific target audience that you want to target via your sponsored display ads. Common strategies that you can opt for include views remarketing, purchases remarketing, searches remarketing, and products remarketing.

Benefits Of Sponsored Display

• It’s a great way of re-engaging with potential customers to facilitate repeat purchases.
• Using it, you can target an already motivated audience to engage with your offerings, both on and off Amazon.
• It allows you to design full-funnel campaigns to get favorable results for your business.

Different Types Of Ad Targeting Available For Amazon Ads

Just having a handsome budget and some feasible product/service doesn’t equip you with the armory needed to dominate your niche using an Amazon PPC campaign. You also need to be aware of all the different targeting options available to assess which alternative would work best for you. Out of all the multiple targeting options available in Amazon PPC, the most popular and effective ones are:

Keyword Targeting

Keywords are the base of almost everything available in the digital realm. For an Amazon PPC campaign, keywords are what bidders bid on and customers search for. So you need to go with something that matches your product and resonates with your potential customers as well. After all, you are paying Amazon for advertising your product, so you need to go with something that customers are searching for. You need to have a set of keywords that are both relevant and effective. Based on this acquired keyword list, you can optimize your listings and ad campaigns.

Product Category Targeting

For it, you can target specific categories of products for your Amazon PPC ad campaign. This feature is available in all three Amazon advertising types, i.e., sponsored products, sponsored brands, and sponsored display campaigns as well. It even allows you to get featured on relevant product pages using the competitors’ ASINs. For instance, if you’re planning to advertise sports shoes, you can target the category “footwear” or “men’s fashion.” to get your product featured in search results and product pages falling under this very category. Other than this, you may opt to target a brand as well that you find is superior in the category your product is related to. In this case, you can target the brand “Nike”.

Step-By-Step Procedure To Set Up An Amazon Advertising Campaign

Now that you have gotten familiar with all the basics of Amazon PPC, it’s time to delve into a step-by-step procedure on how to set up your first Amazon advertising campaign. Let’s get started:

1. Define Your Goals

Having clear goals and ambitions is crucial before you expect anything out of your employed efforts. For PPC Amazon advertising, your goals act as the foundation for building an ad strategy, are used as a comparative factor for measuring results, are the base for making necessary adjustments in your budget, and measure the ultimate return on investment (ROI) on the whole of the campaign. You are going to pay for an advertising campaign, and you don’t want your hard-earned money to go wasted on ads that don’t even align with your business objectives.

2. Decide A Budget

Set a clear budget in your mind as to how much you can spend on your ad campaign. Ensure you allocate it optimally to achieve your desired results while maximizing your return on investment (ROI). Deciding on a well-defined budget is crucial as it helps you manage your spending without exceeding your financial limitations. As a starting point, set a budget of around 30-35% of your total revenue. However, you can go a bit above it as well if needed as per the campaign’s progression.

3. Register For Amazon Ads

Now comes the main step of registering yourself with Amazon Ads. To proceed, you need to first create an Amazon ad account. You get two options for it—Sponsored ads and Amazon DSP and Sponsored ads. Sponsored ads feature the traditional pay-per-click (PPC) campaigns, while Amazon DSP and Sponsored ads are more of an advanced advertising format using which advertisers can buy ads programmatically. Sponsored ads work on Amazon only, while Amazon DSP and Sponsored ads allow buying ads on and off Amazon.

4. Choose Your Campaign Type

Select any of the alternatives from Sponsored Products, Sponsored Brands, or Product Display Ads for your campaign type. As explained above, you have to target a specific customer segment based on their shopping behavior, like those actively searching for keywords (Sponsored Products), browsing related categories (Sponsored Brands), or viewing similar products (Sponsored Display).

5. Find Keywords

The right set of keywords will set the base for a successful Amazon PPC campaign. It allows you to target the right audience and ensures your ad gets placed in the right place when someone searches for your product. To begin with, you can use keyword research tools like AMZScout, Helium 10, and SpyFu, or analyze your existing ad campaign data if you have any. Keep in mind that your chosen keywords are going to have an impact on your visibility, click-through rate, and ultimately, sales on Amazon, so go with something relevant to your product.

6. Create Your Campaign

It’s where the real magic happens. As a seller, you get to define who your target audience is. Here you can set budget allocations, choose relevant keywords, and design ads that align with your product and marketing goals. To begin, head over to Campaigns and select the option Create campaign. Choose and confirm the country for your campaign and choose Sponsored Products. Now enter all necessary information related to your campaign, like the campaign name, your budget, start and end date for the campaign, and more. You also need to choose what your targeting strategy will be, whether it’ll be keyword targeting or product targeting. Afterwards, you can proceed with choosing a targeting method, i.e., automatic or manual.

7. Craft Your Ad

Now you are good to go for creating your first ad. Make sure to use compelling headlines and suitable descriptions to craft your ads. Don’t miss out on highlighting the key benefits that your advertised product or service features and add relevant keywords as well. You also need to upload high-quality images and videos in your listings that showcase your products effectively.

8. Submit For Review

After you’re done crafting your first ad for Amazon PPC, you can proceed with submitting it for review. Amazon will first review your campaign request and will see whether it complies with their advertising policies or not. In general, it takes from around a few hours to a max of 24 hours for Amazon to finalize and approve your PPC campaign requests.

9. Launch The Campaign

Voila! Now that your ads have been approved, you can start seeing their performance. Make it a habit to regularly check all performance metrics like clicks, impressions, CTR, and ACOS using Amazon’s campaign manager. If you find any of the keywords or products not performing well, you can make necessary changes in the bid amount or in targeting settings. On the other hand, if your campaign is performing well, consider raising your ad budget to secure more sales.

Final Insights

If used properly, an Amazon PPC ad campaign can yield sales results that almost look unreal. For newbies, going about it might look daunting, especially because of the complex terminologies and jargon involved. But by comprehending the above-given information, you can easily get started with Amazon advertising. Those exploring reliable options for paid marketing can choose us at DexDel, as we’ve served an extensive list of Amazon sellers till now and have helped them cope with their concern of having low sales. We can also help you gain your organic clicks with our customized search engine optimization marketing services.