Understanding Amazon Ads: Sponsored Products, Brands & Display Explained
Navigating Amazon’s advertising platform can feel like you’re stepping into uncharted territory, especially for new sellers. However, mastering Amazon ads can be a game-changer for increasing product visibility and boosting sales.
In this blog post, we’ll dive deep into the three main types of Amazon ads: Sponsored Products, Sponsored Brands, and Sponsored Display. By the end, you’ll know exactly how each ad works, their key features, and how to use them effectively to maximize your return on investment (ROI).
What Are Amazon Ads?
Before diving into each ad type, let’s briefly touch on why Amazon ads are so powerful. Amazon is not just an e-commerce platform but a search engine where millions of customers actively search for products.
This “buying mindset” means that well-placed ads can directly drive conversions. Sellers use Amazon ads to target these customers, improve product visibility, and, ultimately, increase sales.
Types of Amazon Ads
Amazon offers three primary ad types that cater to different marketing goals:
- Sponsored Products
- Sponsored Brands
- Sponsored Display
Let’s break down each type and how they can benefit your business.
1. Sponsored Products: The Backbone of Amazon Ads
What Are Sponsored Products?
Sponsored Products are keyword-targeted ads that promote individual product listings. These ads appear in search results and on product detail pages, helping sellers drive traffic to specific products. Sponsored Products are often considered the most straightforward and commonly used ad type on Amazon.
How Sponsored Products Work
- Keyword Targeting: Sellers bid on specific keywords relevant to their product. When a customer searches for that keyword, your ad may appear if you win the bid.
- Cost-per-click (CPC) Model: You only pay when someone clicks on your ad, making it a budget-friendly option for sellers.
Ad Placement: Ads can show up in two key places: at the top of search results or within a product’s detail page.
Key Features of Sponsored Products
- Simple to set up, making them ideal for beginners.
- Flexibility to promote individual products.
- Helps boost product ranking in Amazon’s search results over time.
Best Practices for Sponsored Products
- Choose the Right Keywords:
- Use Amazon’s Keyword Planner or third-party tools like Helium 10 or Jungle Scout to find high-converting keywords.
- Set Competitive Bids:
- Keep an eye on your bidding strategy. A too-low bid might bury your ad, while an overly high bid can drain your budget.
- Monitor and Adjust:
- Regularly review your campaign’s performance and adjust keywords, bids, and budgets accordingly.
When to Use Sponsored Products
Sponsored Products are perfect for sellers aiming to drive immediate traffic to specific products. It’s an excellent starting point if you’re launching a new product or running a promotion.
2. Sponsored Brands: Building Brand Awareness
What Are Sponsored Brands?
Sponsored Brands are banner ads that allow you to showcase your brand’s logo, a custom headline, and up to three products. These ads appear at the top of search results, giving your brand prime real estate on Amazon.
How Sponsored Brands Work
- Keyword Targeting:
- Like Sponsored Products, Sponsored Brands also rely on keyword targeting, but with a focus on branding rather than just individual products.
- CPC Model:
- You only pay when a shopper clicks on the ad.
- Ad Placement:
- These ads appear at the very top of search results, making them one of the most visible ad formats on Amazon.
Key Features of Sponsored Brands
- Highlight up to three products and your brand logo.
- Customizable ad copy to craft a compelling message.
- Drives shoppers to a custom landing page, your storefront, or a list of products.
Best Practices for Sponsored Brands
- Showcase Best-Selling Products:
- Highlight your top-performing products to capture more clicks and conversions.
- Create Compelling Headlines:
- Your headline is the first thing customers see, so make sure it’s engaging and aligned with customer needs.
- Optimize Storefronts:
- If directing traffic to your Amazon Storefront, ensure it’s well-organized and visually appealing.
When to Use Sponsored Brands
Sponsored Brands are ideal when you’re looking to build brand recognition. They’re particularly effective for sellers who want to promote multiple products or drive traffic to a branded storefront.
3. Sponsored Display: Retargeting at Its Best
What Are Sponsored Display Ads?
Sponsored Display ads allow you to re-engage shoppers who have already shown interest in your products. These ads appear across Amazon’s website, on competitor product pages, and even on third-party websites (off-Amazon). Sponsored Display offers a powerful retargeting opportunity to convert browsers into buyers.
How Sponsored Display Works
- Audience Targeting:
- Sponsored Display doesn’t rely solely on keywords. Instead, it uses audience data to target customers based on their browsing behavior.
- CPC Model:
- Like the other ad types, this also follows a cost-per-click model.
- Ad Placement:
- These ads are highly versatile and can appear on Amazon’s homepage, product detail pages, and even on external websites like news or entertainment platforms.
Key Features of Sponsored Display
- Reach shoppers both on and off Amazon.
- Retarget potential customers who viewed your products but didn’t buy.
- Automatically generated creatives, which makes setting up campaigns easier.
Best Practices for Sponsored Display
- Retarget Effectively:
- Focus on audiences who viewed your products or similar products but didn’t convert.
- Leverage Product Detail Pages:
- Place ads on competitor product pages to capture comparison shoppers.
- Experiment with Budgeting:
- Test different budgets and monitor what works best for retargeting.
When to Use Sponsored Display
Sponsored Display is excellent for retargeting and engaging shoppers beyond Amazon’s search results. Use it to remind people of products they’ve viewed or to promote similar products from your catalog.
Optimizing Your Amazon Ad Campaigns
Regardless of which Amazon ad type you choose, optimizing your campaigns is critical to success. Here are a few general tips:
1. Set Clear Goals
Define what you want to achieve with your ads. Is it increased brand visibility, boosting sales for a specific product, or retargeting previous visitors? Your goal will dictate your ad type and strategy.
2. Track Performance Metrics
Amazon provides a wealth of data to help you track your ad performance. Key metrics include:
- Click-Through Rate (CTR):
- A high CTR indicates that your ad copy and creative are compelling.
- Conversion Rate:
- Measures how many clicks actually result in sales.
- Advertising Cost of Sales (ACoS):
- The lower your ACoS, the better your return on ad spend (ROAS).
3. A/B Test Your Ads
Don’t settle on one ad format or copy. Test multiple versions of your ads, whether it’s different keywords, headlines, or images. This will help you figure out what resonates best with your audience.
4. Adjust Bids and Budgets
Keep an eye on your campaign’s performance and be ready to tweak your bids and budgets. Some products may need a higher bid to stay competitive, while others might perform well with a lower budget.
Conclusion: Choosing the Right Amazon Ad for Your Business
Understanding the differences between Sponsored Products, Sponsored Brands, and Sponsored Display ads is key to crafting a well-rounded Amazon advertising strategy. Each ad type serves a unique purpose:
- Sponsored Products are great for direct product promotion and driving sales.
- Sponsored Brands work best for building brand awareness and showcasing multiple products.
- Sponsored Display is perfect for retargeting and expanding your reach beyond Amazon.
By strategically leveraging these ad formats and optimizing your campaigns, you’ll be in a prime position to boost sales on Amazon and grow your business.
Looking to dig deeper into Amazon ads? Check out Amazon’s official advertising guide for more resources and tools.
