When we first started selling on Amazon about 12 years ago, I thought it wouldn’t be worth it. Initially, I was right because I hadn’t approached it correctly. I hadn’t put in the effort to set up our first listings properly, and they were average at best. We didn’t have a brand set up, so we lacked brand registry protection, and it felt like a bit of a free-for-all.

Fast forward a few years, and I started looking into it further, putting more effort into our listings—focusing on keywords, images, much more detail, and variants where possible. Sales went up and continued that way for a while. Then, in 2017, in response to some falling sales, we started our sponsored product campaigns. Again, I must admit that I didn’t put in much effort and set up general campaigns, which grew our sales and our costs.

Over the next few years, as the Amazon advertising platform evolved, so did our advertising strategies. Gradually, it became a necessary part of our business model, and at times, we spent far too much money for poor returns. I’d like to think we’ve learned enough lessons with these tools, but even now, this sort of advertising can be both frustrating and rewarding at the same time.

My top tip with Amazon Advertising is to ensure that your campaigns are closely monitored. We had a particular situation where we were spending nearly £20,000 a month on Amazon Ads, and our sales were still falling. It was this situation that caused me to dig deep into Amazon Ads and experiment with lots of different approaches. This resulted in a much better return on our investment and helped us meet our goals at the time.

If you’re reading this, you’re likely considering starting with Amazon PPC (Pay-Per-Click) advertising. You might be a new business owner hoping to sell on Amazon, or perhaps an existing seller looking to boost your online presence. Either way, understanding Pay-Per-Click (PPC) advertising on Amazon can make a significant impact. So, let’s break it down and get you up to speed on this powerful marketing tool.

Pay-per-click advertising is a model where you pay a fee each time someone clicks on your ad. It’s a way of buying visits to your product listings instead of relying solely on organic traffic. On Amazon, this means your products can appear in front of more potential customers right when they’re ready to buy.

As Amazon has grown and more sellers have joined the platform, advertising has become almost essential for generating sales, especially for new listings. That’s not to say you can’t sell without ads, but it’s much harder. To give you a sense of scale, Amazon is on target to make well over $50 billion US dollars globally from advertising sales in 2024, and that figure continues to rise.

With millions of products on Amazon, standing out can be challenging. PPC ads give your products a visibility boost by placing them in key spots where potential customers are most likely to notice them, such as the first page of search results or on competitor product pages.

There are three main types of ads available on Amazon to meet your advertising needs:

• Sponsored Products: These ads promote individual product listings on Amazon and are great for driving sales of a specific item. You can promote products to appear in search results and category browse pages.
• Sponsored Brands: These help you promote your brand and its products. They appear in more prominent positions and can include custom headlines and logos.
• Sponsored Display Ads: These ads can appear both on Amazon and on external websites, helping you reach audiences both on and off Amazon.

Each ad type serves a unique purpose, and choosing the right one depends on your goal, whether it’s boosting brand awareness or driving sales (we’ll cover goals in another article).

At its core, Amazon PPC is all about keywords and bidding. Sellers select relevant keywords for their products and then bid on these keywords. When a customer searches for these terms, Amazon runs an auction to decide which ads to display based on the bids and relevance

You set the limits and rules around these bids when you create your campaign. So, if you’ve set a bid of £0.25 for “Fountain Pen,” and your competitor has bid £0.26, they’ll win the auction. It doesn’t mean your ad won’t show up; it would almost certainly appear next to theirs in this example, but theirs would have the more prominent position.

Keyword targeting is crucial. You want to choose highly relevant keywords associated with your product and ones potential customers may use when searching. Using tools like Amazon’s Keyword Planner can help you find the right keywords.

Each keyword has a suggested bid value based on popularity and context. For example, “iPhone” as an exact keyword may have a suggested bid of £0.80. But adding the word “case” or “charger” to it could cause the suggested bid to increase to £1.30.

Your ads can appear in several spots on the Amazon site:

• Search results pages
• Product pages
• Customer review pages
• The Amazon home page

You only pay when a shopper clicks on your ad. This cost-per-click can vary significantly depending on the competition for keywords and the overall demand for the product category. With some campaigns, we’ve been able to get great results with an extremely low bid of a few pence, and for others, you may need to spend several pounds. It will depend on the competition.

How much it will cost is up to you in a way, and like many things in life, it’s a trade-off between what you’d like and what you can afford. You may want to appear at the top of your competitor’s product page and ahead of them in search results, but this may be expensive.

Nobody knows your business like you, but think carefully about what you are trying to achieve

• Work out your goals for advertising on Amazon. Some suggestions:
  • Profit – hopefully what you’re looking for most; it’s the total of your sales less any costs and what you get to take home or reinvest.
  • Revenue – remember, this is the ego; it’s great to sell lots, but we’ve seen many sellers losing money because they focus on revenue and ignore the costs.
  • Brand Awareness – often voiced as a reason, but remember that customers are generally on Amazon because of the convenience, the perceived low prices, and the free shipping. This means that 99% of the time, the customers are Amazon’s and not yours.
  • Reviews – these help you sell more in the long term, so if you’re in it for the long haul, this could be a factor.
• Know your figures
  • Know your product costs – make sure you include how much it costs to get the product to you or Amazon.
  • Know your costs of sale – what are the Amazon fees, shipping or fulfilment costs?
  • Don’t forget taxes – they may not be due immediately, but they’ll need to be paid, so keep that money aside.
• Before you advertise, get your listings up to scratch with all the relevant details filled out and some great photos. A well-optimized listing will help you sell much more.

If you’re selling on Amazon, you’ll almost certainly need to advertise to some extent. Plan it carefully, as it can be an effective tool, but it can also be a way to contribute money to Amazon’s coffers with little to show for it.

Remember, if you ever feel overwhelmed or unsure, we’re here to help. Don’t hesitate to reach out with any questions or for further guidance on getting the most out of your Amazon PPC campaigns. Together, we can help unlock the potential of your products and achieve greater visibility and sales on Amazon. Happy selling!