Amazon is on its way to disrupt the titans of ad revenue, Google and Facebook. These efforts are becoming more apparent every day, specifically within Amazon search results.
Yahoo Finance reported on October 30, 2019 that Google accounts for 37.2% of U.S. digital advertising dollars spent. Facebook follows with about 22.1%, and Amazon is creeping up on the duopoly with 9% of the market. While Google and Amazon have the advantage of third-party and owned platforms to place ads on, and a distaste for organic results, Amazon has something Google doesn't: the relentless pushing of their private label brands.
A brief look at Amazon search engine results page for "cleanser" shows organic results sprinkled throughout, but what will inevitably catch your eye is a big Sponsored Brand ad (top of search "banner" style advertisement), an entire rows-worth of "Editorial Recommendations", and the best of Amazon's in-house brands' products related to your search.
With the growth of Amazon's private label offerings also comes sectioned off positions within search results or on product pages, boldly asking customers to consider Amazon's cheaper version of what you're looking for. Even while Amazon claims to not use seller data to create their private label products, it's hard to ignore the effects of Amazon nudging their private label paper towels, tank tops, and energy drinks in front of yours.
The Sponsored Products ad-type start the product results with 3 coveted spots. Both Sponsored Products and Sponsored Brands are self-service ad types available through Amazon Advertising. Editorial Recommendations come from an invite-only selection of content creators that may receive commissions from products sold.
Amazon relies on a ranking algorithm that heavily weights product reviews and sales velocity. So as Amazon demotes organic search results to the bottom part of the page, unsurprisingly, the importance of sponsored products increases.
- Marketplace Pulse
Amazon is aware of the benefits and privileges that come with appearing at "top of search". In order to give your product a boost and give Amazon some extra ad revenue, the "Adjust bids by placement" feature can help. Replacing the more catchy "Bid+", this tool can get your product to the top of search by automatically increasing your bid up to 900%. This means if you're bidding $1 on the keyword "cleanser", you can spend up to $10 on a single click after earning the top spot.
"Adjust bids by placement" does have its benefits: you're able to see how your ads have performed over time at top of search, "rest of search" (middle to bottom of search results), and on product pages, which can help you increase bids accordingly. This can also be a quick way to burn cash and hit campaign budget caps early in the day, so make sure non-fixed bids are aligned with your marketing goals and adjust bids by placement responsibly.
So, what does all of this mean for sellers? Moving up in your respective product category takes time and money; time to spend on research and money to spend on clicks. Amazon presents ads as a solution to lack of visibility in search results, but without a handful of glowing ratings, it's getting harder to compete with the top sellers.
Instead of taking the time to unravel the mystery of climbing the Amazon rankings, partner with Fortress Brand. We have proven success in optimizing listings from the inside out, and we'll do the hard work for you.
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Webb, Bridgette. “Amazon Could Disrupt Google and Facebook's Ad Dominance: Expert.” Yahoo! Finance, Yahoo!, 30 Oct. 2019, https://finance.yahoo.com/news/amazon-could-disrup...
Kaziukėnas, Juozas. “Amazon Demotes Organic Results in Search.” Marketplace Pulse, Marketplace Pulse, 30 Oct. 2019, https://www.marketplacepulse.com/articles/amazon-s...