Getting Started With Amazon Advertising

Why Amazon Advertising Is Different (And Better) Than Other Channels

Amazon is where people go to buy. Unlike Google, where searchers might be in research mode, or Facebook, where people are scrolling without purchase intent, Amazon shoppers have their wallets open. They're actively looking for products and ready to purchase immediately.

This buying intent makes Amazon Advertising exceptionally powerful for e-commerce. Your ads appear to people actively shopping for your exact product type. They're not cold prospects who need convincing—they're warm prospects who've already decided to buy. Your job is simply to get your product in front of them at the moment they're ready to purchase.

The result? Amazon Ads typically deliver superior ROI compared to Google Shopping or Facebook ads. A product with a 30% margin might achieve 3x ROI on Google Shopping but 4-5x ROI on Amazon. The audience quality is simply different.

This doesn't mean Amazon Ads are easy or don't require strategy. It means the inherent quality of the audience is higher, giving your strategy more room to work effectively.

Amazon Advertising Basics: Campaign Types and Strategy

Sponsored Products are the most common Amazon ad type. Your product appears as a sponsored result when someone searches for related keywords. You pay per click. This is most similar to Google Shopping ads and drives high-intent traffic.

Sponsored Brands put your brand name and up to three products in a brand banner at the top of search results. These are higher-cost but position your brand against competitors and work well for brand awareness among Amazon shoppers.

Sponsored Display shows your products to people viewing competitor products or products they've viewed before. This is Amazon's version of remarketing and works well for moving interested prospects to purchase.

Amazon Stores create a dedicated storefront for your brand within Amazon. These work for brands with multiple products and provide a place to tell your brand story.

For most businesses starting with Amazon Ads, focus on Sponsored Products. This is the highest-volume, easiest-to-manage format and typically delivers the best ROI.

The Four Pillars of Successful Amazon Advertising

Step-by-Step: Launching Your First Campaign

Step 1: Optimise Your Product Listing

Your Amazon listing is the most important conversion factor. If your listing is weak, even perfectly-targeted ads will underperform. Optimise:

• Title: Include primary keyword, key features, brand name (max 200 characters)
• Description: Highlight benefits and unique features. Use bullet points. Make skimming easy.
• Images: High-quality main image, multiple angle shots, lifestyle images showing product in use
• Keywords: Research 20-30 relevant keywords shoppers use to find your product
• Reviews/Ratings: Push for customer reviews. Higher ratings dramatically improve conversion rates and reduce ad spend needed

Spend a week on listing optimisation before launching ads. A 2% improvement in listing conversion rate (from 5% to 7%) is worth far more than rushing into paid ads.

Step 2: Create an Automatic Campaign

Amazon's automatic campaigns are powerful for learning what keywords shoppers use. Create a campaign with all your product variations, let Amazon run automatic targeting, and monitor for 3-4 weeks. Automatic campaigns show you which keywords convert and which don't.

Automatic campaigns typically cost more to run (Amazon bids aggressively) but provide invaluable data. Use them as research, not as your primary campaign structure.

Step 3: Create Manual Campaigns Based on Data

After 3 weeks of automatic data, create manual campaigns targeting your best keywords. Divide keywords by theme: exact matches (highest intent, highest cost), phrase matches (medium intent, medium cost), broad matches (lowest intent, lowest cost).

Set initial bids at £0.50-£1.50 depending on competition and margin. Monitor conversion rate and ACoS. If a keyword converts well, increase the bid. If it doesn't convert, lower the bid or pause it.

Step 4: Monitor and Optimise Weekly

Every week, review:

• Which keywords drove sales (keep or increase bid)
• Which keywords drove clicks but no sales (lower bid or test different keyword match type)
• Overall ACoS—is it below your target? (if yes, scale; if no, optimise)
• New search terms showing up under automatic campaigns (add profitable ones as manual keywords)

ACoS (Advertising Cost of Sale) is your primary metric. If you sell a product for £50 with 40% margin (£20 profit) and spend £10 on ads, your ACoS is 50%. This is likely profitable. If you spend £15 and ACoS is 75%, it's less profitable.

Typical profitable ACoS ranges from 20-40% depending on margin and lifetime customer value. Calculate your breakeven ACoS (your profit margin), then aim for campaigns at 60-70% of that threshold.

Common Amazon Advertising Mistakes (And How to Avoid Them)

Mistake: Running only automatic campaigns. Automatic campaigns are expensive because Amazon doesn't optimise for profitability—only for volume. Use them for research, then shift spend to profitable manual campaigns.

Mistake: Ignoring product listing quality. Ads drive traffic, but listings convert traffic. If your listing is weak, ads waste money on clicks that don't convert. Optimise listings first, ads second.

Mistake: Bidding randomly. Bid based on target ACoS, not hunches. If your margin is £20 per sale and you want 40% ACoS, bid to keep costs under £8 per sale. Work backwards from profitability.

Mistake: Not tracking lifetime value. A customer worth £50 in first purchase might be worth £150 lifetime (with repeat purchases). Account for this when determining acceptable ACoS. You can afford higher ad spend per customer if they're repeat buyers.

Mistake: Abandoning campaigns too quickly. Amazon campaigns need 3-4 weeks to stabilise. Data in the first week is unreliable. Give campaigns time to gather sufficient data before optimising aggressively.

Scaling Amazon Advertising From Test to Profitable Machine

Once you've proved a campaign is profitable, scale gradually. Increase bids by 10-15% weekly and monitor results. Small bid increases usually improve both volume and profitability simultaneously. Too-aggressive scaling can cause campaign costs to spiral.

As you scale winning keywords, expand to similar keywords. If "running shoes men" works profitably, test "marathon shoes men" and "athletic shoes men." Profitable keywords naturally cluster—if one works, related keywords usually do too.

Reinvest profits into scaling. A profitable campaign at £1000/month budget might scale to £3000/month. This requires patience, but the compounding effect is powerful. A campaign scaled from £1000 to £3000/month increases annual revenue by £24,000+ (if your campaign is 3x profitable).

For product-based businesses wanting professional Amazon Advertising management, or exploring how Amazon Ads fit alongside Google Shopping campaigns, shopping feed optimisation services manage both channels. Or discuss custom packages for e-commerce needs at custom packages, or explore options through direct contact.