Know About Amazon Pay Per Click (PPC) Best Practices 2022

“You can’t just open a website and expect people to flood in. If you really want to succeed, you have to create traffic” opines Joel Anderson. Advertising is one such successful marketing tool used across online and offline businesses these days for creating traffic to a business website. Marketplace behemoth, Amazon has rightly utilized this contemporary need with an additional cost feature, none other than the Amazon Pay Per Click advertising module.

Here we have jotted down some key practices that should be adhered to by potential sellers like you to reach your target audience ahead of others.

A quick run-through over the topics covered in the blog –

1. 1. What is PPC?
   2. How Does Amazon PPC Work?
   3. Role of Amazon A9 Algorithm
   4. How does the Amazon A9 Algorithm work for Amazon PPC
   5. Eligibility Criteria For Running Amazon Ad Campaign
   6. Benefits of PPC for small business
   7. Best practices for profitable PPC advertising
   8. Advantages and Disadvantages of PPC

What is Amazon Pay Per Click or PPC?

Pay Per Click is an advertising cost incurring method practiced on Amazon. The term is quite self-explanatory. A seller running an advertising campaign incurs cost only when a user clicks on his/her ads. What it means is –

1. The views are free
2. The impressions are free
3. Pay only for the clicks made by the user on your ads

Also Read: A Complete Guide on PPC Advertising

How does Amazon PPC Work?

PPC works on Pay per click module. This means that as an Amazon advertiser, you will pay for the clicks made on your ads.

The Amazon PPC module offers a cost-effective advertising method. The advertiser can bid as low as $1 for a keyword that would be paid to Amazon on every click, unlike google ads where the basic ads start from quite a high bidding price.

In the contemporary age, you can attract people online multifold times than offline media. Advertising has always been a successful weapon to enhance visibility for decades.

PPC is a cost-effective and strategic way of hitting only the target audience. The cost is minimal along with continuous visibility on multiple screens.

Look at the image below to figure out how can you set your bids-

Look at the image below to understand how a huge amount of different types of keywords can be managed and set bids accordingly

Role of A9 Algorithm

Amazon’s A9 Algorithm works on targeted keywords and conversion rates. It means that A9 algorithm shows results best suitable for the typed keyword by the user. The results shown are the ones with maximum sales and conversion history.

This makes the A9 algorithm different from google. Since Amazon is a customer-centric business itself, it focuses more on conversion rates and sales. The products with higher sales are considered first in the display to convince the user to buy the product without bouncing back to another eCommerce website.

Boost your sales by adding the Amazon Top Selling Products to your Inventory.

How A9 Algorithm works for Amazon PPC?

As already discussed, the PPC campaign works on keywords. Relevancy of your keywords to your products and their probability to meet the keywords of users will determine the display of your product ad.

The twist to this is that your sales history and conversion rates are also a crucial aspect of product ad display.

The best results will be aligned on the basis of the sales rankings of the products. This is a protip to run a campaign after selling quite a good amount of units and creating at least a satisfactory sales history.

Look at the below example, with the keyword ‘Hat’, the results shown are the sponsored products with the same keyword and very good ratings. As a seller, you must understand the keywords used for product description and sales history.

Once building a good sales foundation, you can jump over understanding and optimizing different PPC ads.

The Advertising Cost on Amazon is directly proportional to the budget decided by you in accordance with the Amazon ad types that suit your business.

Avail Amazon PPC services by CedCommerce.

Eligibility Requirements To Run PPC Ad Campaigns

1. Seller Account: To avail of the advertising tools on Amazon, you must be an active seller on Amazon. Amazon does not give its services to anyone just asking for it.
2. Shipping: A seller must be able to ship and deliver to customers of the United States.
3. Buy Box: These ads are allowed only to the potential sellers who have good sales history thus winning BuyBox several times. This means that you must be capable of winning Buy Box, only then many ad types like Amazon Sponsored products will display your ads.
4. Amazon Brand Registry: Amazon Brand Registry is important for Headline Search Ads. Apart from this, a seller must protect their intellectual property rights. There are many cases where many dishonest sellers sell counterfeit products and harm good potential sellers.

Did you know ? Amazon suspends account of the sellers if they sell counterfeit products or copy illegally the products of other sellers. There are many more reasons that you should know about Amazon Seller Account suspension.

Get a sneak-peek into different ad types offered by Amazon and analyze what suits your business-

Amazon Sponsored Products

Amazon sponsored product is the basis of all ads. A seller can easily register for the ad by registering into advertising in the seller account. After registration, a seller creating a campaign for the first time can create different campaigns for different products and can further divide them into ad groups and assign the most searched keywords to each product, so that when a user types those keywords, Amazon pops up your ad on the top page result.

The ad works on Pay per click cost module. This means that you are eligible to pay to Amazon only when a user after getting your product in the search result, clicks on it.

However, a mere campaign building and practices do not serve the purpose. You must know the basic succeeding principles and practices to run your campaign successfully.

Amazon Sponsored Brands

Potential brands can register for this type of ad. Under this ad, your product is highlighted along with your brand. It works best for creating brand awareness among people.

As soon as the person clicks on the brand logo appearing on the top of the result page on amazon, the user is directed to your product page where your entire products are listed for them to explore.

Amazon Product Display Ads

This is a more elaborative type of advertisement on Amazon. If you bid the right amount and win the race of getting displayed on Amazon, your product will be shown with a complete description on the result page.

• Remember to keep the product image as captivating as possible.
• Make the product description as detailed as possible.
• Use the right keywords for Amazon SEO to reach your products.

Video Ads

Video ads are the most engaging ads as people connect to your brand and product story immediately. Remember that creating a good video is quite expensive and time taking, but the profit that it harbors is equally huge.

Before you start to explore the advertising cost on Amazon, learn in-depth about Amazon Ad types, their nature and how should you be using them as per your business needs. We have an entire dedicated article to let you understand Amazon Ad Types and Best Practices for Campaign Set Up.

Benefits of PPC for Smalll Business

When you start an online small business, you cannot expect customers to know about your products in their dreams. You will have to advertise your products ahead of your competitors and reach your target audience as frequently as possible. The following a few benefits of Amazon PPC for your small business-

• Become discoverable by your customers.
• Pay only when your ad is clicked with free impressions and views.
• Have the freedom to bid on the right keywords and change them anytime you want.
• Amazon helps sellers to provide all the metrics that highlight the performance of each of the keywords. As a seller, you can take advantage of this metric and decide the most suitable keywords for your campaign.
• Amazon gives a choice between automatic and manual settings. If you are new to PPC and amazon advertising module, let the targeting be automatic. The entire search of keywords will be taken care of by the Amazon server.
• As a small business, it is quite obvious to learn through the hit and trial method. With Amazon PPC, you have the freedom to make changes in the bid as you learn and advance with your sales.

Best Practices For Amazon Pay Per Click

Set Your Goal

Set your goals. Long and short term both. Decide between speed and efficiency you want to build your campaign on.

Choosing speed as your business goal for quick visibility and sales needs a good bidding amount on your competitive keywords. A keyword with the highest bidding is often chosen by Amazon to display first.  This goal of business can be utilized if you already have an established online business and have a sufficient budget to invest in keywords.

Choosing efficiency means paying less for keywords and earning more through higher sales. This is one of the metrics to calculate the success of your advancement. The metric is called ACOS which stands for Advertising Cost of Sales. This metrics is calculated by dividing money spent on an ad by the amount of sale generated multiplied by 100. Example – Your total spent on advertising on a campaign was $50 and sales generated were worth $ 100, the percent will be 50%.

Choose Between Automatic or Manual Settings

To make your task less hectic but yet productive, you should choose Automatic for the initial days where you give entire responsibility to Amazon to set target keywords for your products.

Then when you feel that there are many variations in your products and each needs a lot of frequent changes, you can switch to manual settings.

Create Campaigns Carefully

The ad campaign is the heart and soul of your advertising. Create separate campaigns for separate products. You can also divide your campaigns into different ad groups. Ad groups are created to make campaigns very specific to a product. For example

Campaign name – Male Bottom Wear

Ad group 1 – Male casual bottom wear

Ad group 2- Male sports bottom wear et cetera.

You can also divide these ad groups on the basis of sizes, colors, etc, and assign specific keywords for each one of them.

Be Careful About The Products You Choose For PPC Campaign

Always bid for the products valuable from a market point of view. The products that are not doing well should be deleted from the campaigns as early as possible. Wasting money on bids for less profitable products.

Figure Out Negative Keywords And Remove Them

In the list of various types of keywords, Negative keywords are one of them. These are the keywords that are irrelevant to the relevance of your products. Because of negative keywords, your ads get displayed but are being clicked but not purchased for a long period of time because the user never actually searched for that product. But you lose spending a good amount of money on the click.

Get Clear With the Basic Idea Of PPC

The basic idea for optimizing PPC is very simple and straight –

• Run campaigns to find keywords bringing sales
• Remove keywords that are low performing
• Set higher bids on keywords that are actively performing

Dont Forget to Analyse Your Metrics

You can easily access the entire chart in a tabular form. Look into each of these numbers and build your investment, budget, and campaigns accordingly.

Watch the video below to understand how you can optimize your PPC without wasting a single penny-

Advantages And Disadvantages Of Amazon PPC

Advantages of Amazon Pay Per Click

Easy to Optimize – Pay per click is a bid that a seller fixes. So you can easily target and choose where to bid and to what extent.

Easy to Measure – Each of your campaign performance can be accessed right in front of the seller. Do take out time to understand the entire game and turn it around your business by taking appropriate measures.

Access to Complete Control –  You have complete control over changing every aspect of the campaign. Also, no payment is paid in advance. The bid can be as low as $ 1. What could be more financially stable than this?

Also Read: Tips to Increase Sales on Amazon

Disadvantages of Amazon Pay Per Click

Your lack of understanding about the ad campaign, terminologies, best practices, and how PPC works can ruin your goal. Do get acquaint with the advance strategies of PPC working and then get on board.

The problem of Weed Traffic – This is outcast traffic. Most of the keywords that you might end up bidding can generate traffic that is completely a waste. Note that an Amazon search engine has nothing to do with whether or not there are clicks on your ad that actually lead to sales and thus, you will have to pay every time there is a click on the ad.

More Market-Goal Oriented – Now what this point means is that through PPC campaigns on Amazon you can largely meet your marketing goals rather than conversions or sales itself. You can go ahead with visibility, brand awareness, and online promotions on multiple devices but not necessarily increasing sales in every campaign.

Concluding Words

PPC is one of the easiest and faster way of reaching out to your potential customers on Amazon. Even if your campaign does not perform well, the loss you incur can easily adjust.

Hope this blog helps you understand some basic aspect of Amazon PPC!

Also Read: How to Strengthen your selling by multichannel selling on Amazon.