Amazon Sponsored Products (‘PPC’) is a very useful tool for sellers looking to increase their sales on Amazon. However, with both sellers and brands leveraging the sales potential offered by Amazon ads, the Amazon PPC landscape is getting increasingly crowded (and costly).
With this increased competition driving the average Cost-Per-Click (‘CPC’) up across all Amazon product categories, sellers need to optimize their PPC campaigns to maximize their ad visibility and keep a tighter reign on their advertising costs.
Below are our tips to help improve the performance of your Amazon PPC campaigns, and ultimately help increase your sales on Amazon. But first, let’s discuss what Amazon PPC even is.
What is Amazon Sponsored Products?
Because Amazon is home to so many products for sale, they began the “Sponsored Products” program to offer paid visibility for sellers. The sponsored products are items that will appear higher in Amazon’s search results because the seller of those items is paying Amazon each time a shopper clicks on their listing. The PPC program works for both Amazon and its sellers because Amazon makes a profit on the service, and sellers increase visibility against competitors and they sell more items.
To help you, we have come up with a list of Amazon Sponsored Product tips that are sure to get your products in front of potential buyers and increase your profits.
Tip 1: Research keywords
In order to have potential customers find your products, you have to be using the right keywords in your product titles and descriptions. The first step is to find out which keywords make sense for your business. Below we offer a few ways to find them:
Use Sonar to find PPC keywords
Product ads can only appear on Amazon when your keyword matches the customer’s search term. To maximize the reach of your PPC ads, you need to perform thorough keyword research to ensure you are bidding on all relevant keywords for each product.
Sonar, a free Amazon keyword tool, let’s you pick the top 20-50 keywords for your PPC Manual Campaign. Importantly, Sonar allows you to sort keywords by search volume, allowing you to prioritize the relevant keywords for each product.
With Sonar, you eliminate the risk of bidding on irrelevant keywords, as they only display keywords pulled from real search queries used by Amazon customers. Conversely, if you relied on Google AdWords for your keyword research, you risk bidding on keywords that are simply not relevant to the (usually product centric) search queries of Amazon customers.
Research long tail keywords
Long tail keywords are phrases that usually contain three or more keywords, and highlight a more specific search intent by the customer. Essentially, you are targeting customers further down the conversion funnel. Usually there is less competition for long tail keywords, so your CPC should also be lower.
Use the search volume estimator in Sonar to help you quickly identify the most relevant long tail keywords. You can also copy and paste the long tail keywords you’ve identified in the Search Term Report, which will generate a list of similar relevant keywords. You can then export the similar keywords via Excel and add to your PPC campaign.
Use Google Keyword Planner
Another great way to find keywords is with Google’s Keyword Planner. All you have to do is enter your product listing (or better yet, a competitor’s listing), and then select your targeting options, hit enter, and you’ll have the keyword research for that listing and monthly search data.
Try auto targeting
If you prefer not to do your keyword research manually, Amazon offers an “Automatic Targeting” option when setting up a campaign. This can be a real time-saver, as long as you have a detailed product page for Amazon to find keywords.
Tip 2: Refine your keywords
Once your campaigns are set up and you have your first week of keywords, your work isn’t quite done. You need to run keyword reports regularly and add to your campaigns. You are able to include up to 100 keywords in a manual campaign, and you can continue to refine them for better performance. Over time you will be able to determine which keywords are the most successful – use those! Being reactive as well as proactive is the key to optimizing your keyword usage.
Remove negative keywords (quickly)
Sellers need to be proactive. Remove negative keywords quickly and on a regular basis. You risk spending advertising dollars on unprofitable keywords.
Regularly monitor under-performing keywords that generate clicks, but no purchases. Add those words to your negative keyword list to avoid spending ad dollars on phrases that aren’t convert for your business. Remove the keywords with a high click-through-rate (‘CTR’), but low conversion rate (‘CR’), because these are the keywords that are costing you clicks, but not generating any sales.
However, keep in mind that the more negative keywords you use, the more you will restrict your ad reach for a particular product.
Tip 3: Budget for Amazon PPC
It’s important that you budget for any marketing and advertising strategy you are considering, and Amazon PPC is not an exception. Make sure to do the math and be sure that you have an idea of how much you are willing and able to spend without lowering margins too much. Keep in mind the cost of goods, Fulfillment-By-Amazon (FBA) fees (if applicable), and any other costs, when you are deciding whether your budget can handle PPC fees.
Related: FBA fees draining your profits? Use these tips to avoid paying long-term storage fees.
Tip 4: Optimize your keyword bids
Once you’ve set up a new ad campaign for your product, learn how to optimize your CPC bids in order to control your PPC costs. First, you will need to calculate your target ACoS (Average Cost of Sale). By comparing your actual ACoS to your target ACoS, you can measure how well the ads are performing against your profit margin goal.
Track the right metrics
There is no point in running a paid campaign if you are not going to track and monitor the results. If you don’t know and understand what you are paying for and that it’s successful, you may as well be throwing your money away. There are many online inventory solutions that allow you track the following important metrics:
- Spend: This is what the campaign has cost you so far. You can pick your timeframe (daily, weekly, monthly, campaign-to-date, etc.)
- Sales: This is the total amount of sales that you have made from the ad campaign. Keep in mind that this is gross sales, not profit.
- ACoS: This is the Average Cost of Sales. Amazon shows you the ACoS per campaign, per keyword, and per group.
Guideline for CPC bid optimization:
- If your actual ACoS is more than your target ACoS, lower your bid to test whether you can lower ad spend without affecting your sales.
- If your actual ACoS is less than your target ACoS, it means you have more budget to spend on ads. Consider raising the bid to test whether you can expand your ad reach (and therefore your sales).
- If your keywords are not receiving any impressions, check if you selected the correct Product Category and that you have the keyword included in your ad listing or Seller Central backend search fields (i.e. your backend keywords not included in your product listing page). If your product category is correct and the keyword is included in the listing, then you will need to increase your bid to test whether a higher bid can make the keyword ‘active’.
- Keywords that do not generate any sales over a longer period of time, even after the keyword bid is lowered, should be removed from your Manual campaign and added to your negative keyword list.
Tip 5: Make good use of keyword data
Now that you have some concrete data about your keywords, you can use it to boost your organic rankings by incorporating it into the keywords section of your listing. While you can decide which keywords to use, you will most likely pick the highest trafficked and the highest performing keywords.
Using the data you have collected to inform your listings is an easy way to optimize the PPC campaign while covering all your bases with this twofold approach.
Related: Data drives profits. Turn your business into a well-oiled machine with our free guide on performing business reviews and creating annual plans.
Final words: Enjoy increased Amazon ranking
You will likely notice that as you employ a Sponsored Products campaign, your Amazon sales rank will start to increase as well. Hopefully, you are already collecting positive reviews for the products you sell using the PPC campaign. That, along with increased sales volume, should also boost organic results, allowing you to eventually cut down or completely end your paid campaign.
We’d like to thank Franz Jordan, the CEO of Sellics, for helping us write a complete guide on Amazon PPC. Sellics is a powerful All-in-One tool that combines everything sellers need to be successful on Amazon. Whether you’re looking to increase sales or lower your ACoS, you can manage your Sponsored Product campaigns entirely in their PPC Manager. Other features include our profit dashboard, keyword ranking optimizer, competitor monitoring, and more. They offer a 14 day free trial for new users.