It’s no secret that advertising on Amazon can be a powerful way to drive sales and increase visibility. However, with so many sellers competing for attention, it can be difficult to know how to create an effective Amazon ads strategy that maximizes conversions. In this article, we’ll explore the key metrics to evaluate, bidding strategies by keyword type, and answer FAQs about Amazon ads. By the end of this article, you’ll have a better understanding of how to create an effective Amazon ads strategy that drives increased visibility and conversions.
Marketing Campaign Metrics to Monitor
To generate conversions, you first need to generate impressions and clicks. For most Amazon ad types, you don’t pay for impressions, but are charged once a consumer clicks on your ad.
Studies show that an average click-through-rate for Amazon ad campaigns is only about 1% and an average conversion rate is between 10-15%. The truth is that a “good” click-through-rate or conversion rate varies depending on your product category and willingness to invest in campaigns.
There is no “right number” of clicks or conversions – it’s about how your brand quantities the return on investment. Of course, there’s a handy metric for this: Return on Ad Spend; but even this metric can send you a bit off course. For example, if you’re expanding your product line and entering a new category on Amazon, you’ll likely need to over-invest in that category’s keywords for a while to grow and may not have a high ROAS for a solid 6 months to a year. But, once you’re established in that category, you’ll have earned organic rank and see higher ROAS.
In our experience, some companies are very willing to invest in marketing and don’t mind overspending at first if it means a wider reach and more potential sales. Regardless of how you measure ROI, every Amazon seller wants the same thing: sales. So, let’s dive into different keywords to bid on to boost conversions.
Keyword Bidding Strategy
Your keyword bidding strategy will depend on your marketing budget, but here is a general hierarchy to follow:
- Branded keywords
- Unique keywords (product names, trademarked words)
- Keywords that convert at a high rate
- Keywords your competitors use
- Seasonal or inconsistently converting keywords
Branded and Unique Keywords
You can safely max out your bidding on branded keywords because they are about as close to a guaranteed sale as you can get in advertising. The same goes for your product names and trademarks.
Competitor and High-Converting Keywords
Generally, keywords that convert at a high rate should pay for themselves, but closely monitor them. With the level of competition across the Amazon marketplace, you should expect competitors to use advertising as well (which is why it helps to target their keywords, too).
Inconsistent Seasonal Keywords
Seasonal keywords and others that convert inconsistently are going to see fluctuations in their bid amounts. Around the holidays, you might adjust your keyword bidding strategy to include words like “gift” or “present”. These keywords might see some conversions throughout the year when people are birthday shopping, but they are more than likely goldmines in the Winter season when people are looking for holiday gifts.
PRO-TIP: Target Amazon Long Tail Keywords
Amazon long tail keywords are search terms with typically more than 3 words. Examples include “shoes size 8 for women” or “black long sleeve sweater for kids”.
Long tail keywords convert 2.5x more than shorter keywords and can be a low-cost goldmine. They’re not searched as often as shorter terms are, but since they’re so specific, customers who search for long tail phrases are usually bottom-of-the-funnel and ready to purchase.
Common Questions about Amazon Keyword Targeting
How to find the best keywords for Amazon advertising?
You can find the best keywords for Amazon advertising by using keyword research tools, analyzing competitor keywords, and looking for which keywords in your Amazon ads dashboard have the highest conversion rate.
Are Amazon sponsored ads worth it?
Amazon sponsored ads are worth the investment, even if you have a limited budget and especially if you’re a new seller. Given the amount of competition on Amazon, it’s incredibly difficult to generate sales or build a loyal customer base if you’re not already an authoritative brand or organically high-ranked seller – in which case Amazon sponsored ads would be key to your success on the platform.
Conclusion
Constantly run tests to see which of your campaigns have the highest conversion rates then put a bigger budget towards them. Amazon says 25 minimum search terms is a solid starting place.
Conversion Rate is the most important metric to pay attention to – but Impressions and Click-Through-Rate are valuable to track, too. Conduct regular keyword and campaign maintenance to ensure you aren’t wasting money on terms that don’t drive conversions.
