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Amazon PPC: How to Create a Successful Campaign

Brooke Spallino

Are you looking to push your Amazon business’ visibility to the next level? Chances are that you’ve come across the term pay-per-click or PPC advertising in the process of establishing your business.

PPC is one of the most popular forms of sponsored advertising on the internet, and for good reason. With instant results and high potential ROI, it works well when you’re trying to shine a spotlight on a brand, provided that you run your PPC campaign effectively.

That’s where we come in. Below is a simple, consolidated guide to running a successful PPC campaign. Let’s start with the basics:

What Is Amazon PPC, and How Does It Work?

Also known as Amazon sponsored ads, Amazon PPC is a widely-used advertising platform that helps to drive sales for companies while maintaining high ROI for each spend. 

The PPC platform accomplishes this goal by only charging advertisers when a user clicks on an ad. You will not have to pay for simple views and impressions, many of which don’t contribute to sales.

Remember, the main reason why new sellers aren’t getting any customers is that Amazon’s priority is to sell goods. This does not happen unless Amazon sends customers our way, which is why PPC campaigns can be so important during the early days of an FBA business.

PPC campaigns can be optimized in a variety of ways, and have greatly helped to democratize the ad spending process for thousands of companies all over the world.

How Does Amazon PPC Set Ad Prices?

You might be wondering how Amazon sets the prices for each individual click. The answer is simple – it holds auctions where advertisers compete against each other to grab ad spots.

This process is fairly straightforward. On the PPC platform, all advertisers place a bid amount, which is weighed against others for ad spots. However, here’s where the system gets more interesting.

To prevent ad spends from going too far up the ladder, Amazon has set a limiting factor right into the auction mechanics. Let’s say that you put down $1.50 for a keyword, and the second-highest bidder offers $1.00. Not only will you win the ad spot, you’ll do so at just $1.01 per keyword, because Amazon chooses the highest bidder, but sets the price depending on who bids second-highest.

As a result, ad spends are primarily controlled by the sellers, with seasonal variations, time of day, and other factors impacting the result.

How To Run A Successful PPC Campaign

Like most digital marketing staples, PPC campaigns can seem a bit confusing from the outside, so let’s dive in and clear the air a little bit.

To start with, all PPC campaigns are based on three key factors:

Campaign Type

Each PPC campaign can be set to one of two types: automatic and manual. While these terms can give you a hint of what’s to come, we’ll get back to them a bit later.

Ad Groups

These segregations allow you to divide up your campaign into bite-sized pieces, giving you the chance to micromanage keywords, navigate and analyze your campaign, and simply keep things more structured and organized.

Keywords

The building blocks of any PPC campaign are the keywords that Amazon’s algorithm uses to match customers to seller products. Since these keywords are so important, they’ve also been divided into a few types, based on their functionality:

  • Exact: These are pretty much what they are described to be – simple keywords that include misspellings and plural/tense forms.
  • Phrase Match: Here, you’re aiming for keywords that show within phrases. Let’s say that I search for jasmine scented candles. If a seller has set up a PPC campaign with “scented candles” as a phrase match keyword, they’re likely to match with our search results.
  • Broad Match: This intelligent set uses the Amazon algorithm to find synonyms and variations of the keywords you choose, covering a wide variety of potential customers. Using “football” as a broad match keyword, for example, would match with both soccer and rugby.

Remember, keywords can be quite varied and it’s easy to fall into a rabbit hole when trying to separate current trends from passing fads. You can get a good primer about those by reading this article.

Starting Your First Campaign

Now that you understand the basic mechanics of how a PPC campaign works, let’s actually get one off the ground. 

Interestingly, many marketers recommend that you start off with two campaigns, which works very well for the purposes of teaching you the basics. You can start by creating an automatic PPC campaign first, and then a manual one.

You can do this by:

  • Opening up Amazon’s Seller Central.
  • Click on Advertising.
  • Click on Campaign Manager.
  • Click on “Create Campaign”.

Running Your First Automatic Campaign

You might be wondering why we’re going right into an automatic campaign, where we have no control over which keywords Amazon will assign our products. The answer is simple – automatic campaigns provide a simple, effective, cost-limited way to discover which keywords perform better for your products.

Remember to maintain a modest budget for this campaign, and keep checking in on how well it is working. Over a couple of weeks, you’ll uncover a list of high-performing keywords. Note them down, and set them aside, because we’ll need them shortly.

As your list of successful keywords begins to expand, gradually phase out the spends on your automatic campaign. You can make this easier by tagging your top keywords as “negative keywords”. This will prevent the campaign from spending on them, and will free them up for your manual campaign.

Which brings us to…

The Real Deal – Running A Manual Campaign

Armed with a bunch of solid keywords from both our automatic campaign and sources such as Google Keyword Planner, we now have the ammunition to optimize our very first manual campaign.

Start off by beginning a new campaign, and choosing the manual option. Once ready, you can create your ad group, give it a name, import your list of keywords, and finally select your product listings. This will allow you to generate your ads.

Let’s say you’re running a video game merchandise brand on Amazon. You can list your campaign as “Automatic PPC Products”, and divide your ad groups into “t-shirts” and “keychains”. Alternatively, you can even divide your items fandom, such as  “Super Mario” or any other line whose products you stock.

After this, you can set your default bid, which is the highest amount you’re willing to pay when someone clicks on your ad. As discussed earlier, this depends mostly on your competitors, and what they’re bidding at. Give yourself some time, and you’ll develop a better understanding of how much to put down. $0.50 to $1.50 is a good starting point.

All that’s left to do now is add in your keywords, set bids for them, and you’re golden. Using the above example, you can potentially add keywords such as “videogame t-shirt” as a broad keyword, and specific character names as exact keywords.

Remember, running a PPC campaign is more of an art than a science. You’re dealing with customer behavior, which can be quite tricky to unravel. After two or three weeks, revisit your campaign, and you’ll now have a series of interesting data points to play with. More on that below.

How To Optimize Your PPC Campaigns – 5 Simple Steps

While the above example is a pretty cut-and-dry way to get started, the Amazon PPC system can snowball into something great for your brand or turn into a time and money sinkhole.

We’re here to help you stay on the right side of the fence. Here’s a few things to consider:

Consistently Review Your Keywords

As we’ve shared above, the most important part of any PPC campaign is the set of keywords you choose to bid for and keep attached to your ad groups.

Over time, your analytics reports will give you a detailed history of each keyword’s performance, and you’ll soon discover that some keywords far outperform others.

Spend some time each week reviewing these, and if you find any low-value keywords, cut them out, and save your business’ marketing budget at the same time.

Choose the Right Keyword Types

It might seem ideal to simply throw everything you’ve got at the “broad match” option. Amazon agrees with that inclination, and offers it as a default choice. However, doing this offers low clickthrough rates (CTRs) and may not be as profitable in the end.

Instead, maintain a healthy variety of broad keywords, but also spread out with other variations to reach as many potential customers as possible. 

Generally speaking, you’ll benefit from exact match campaigns more if you’re on a small budget or in a niche market. Larger budgets can run better with broad matches, because you have more space to experiment.

Play Offensively

Many marketers choose to run an aggressive strategy to interfere with other competitors’ efforts to rule the market. If you sell products in close contention with other sellers and have the budget, consider bidding on their keywords instead, such as the brand names of the products they sell.

This will let you butt in when someone searches for their products, and get your foot in the door for other customers.

Avoid Common Pitfalls

In the pursuit of FBA success, it’s easy to get caught unawares. There are several PPC mistakes to be made in this game, and any one of them could be invisibly harming your bottom line.

From not utilizing available tools to overexerting your PPC spends, try to be as aware as possible about both your triumphs and shortcomings in a PPC campaign.

Keep Yourself Updated

Like any leading marketing platform, Amazon’s systems are constantly being updated, shifted around, and enhanced with new features. Keep yourself updated on blogs for the latest info, and if any major changes occur, review your entire set of campaigns to check if any key (and keyword) changes need to be made.

It isn’t all about the tech, though. Current trends and even customer psychology insights can help you to craft better ads, and better campaigns to promote them.

Conclusion

By now, you should have a good idea of how to set up your first successful PPC campaign. Congratulations!

However, The work has just begun. Make sure that your campaigns are periodically updated and stay patient. While results with PPC are stable and improve over time, it will take a while for you to lock down the perfect keywords.

If not, there’s always automatic campaigns to take the work off your back. Put in the effort though, and you’ll have a great inflow of new potential customers, allowing your new digital storefront to really take off!