Why Advertising on Amazon Is the Next Big Move for Retailers
August 12, 2018
If you're a retailer, Amazon.com is likely something you refer to as the "evil empire", the "800-pound gorilla" or a raft of other not-so-nice terms. It's true that Amazon is pulling sales from all sectors, but what you may not realize is that there is a huge potential to reach their captive audience with your messaging. Retailers from around the world are seeing the massive value of advertising their products and services on the online giant, driving Amazon's ad sales as high as $2 billion -- making digital advertising their fastest-growing segment.Every retailer in the world would love to hit Amazon's numbers, with a 39% year over year growth rate that dwarfs their competition. While you may be seeing a big competitor, it's important to leverage Amazon's reach if you want to drive sales to your products and website. Like it or not, here's why Amazon is the Next Big Thing in retail advertising.
Finding New Customers
One of the biggest challenges for a business is finding new customers. The reality is that Amazon.com attracts millions of shoppers on a daily basis. People who are ready, willing and able to make a purchase. They are accustomed to beginning their search at the online retailing giant, so when they see your advertisement they are already primed for action. The majority of large retail brands have decided not to advertise on Amazon, according to a recent Digiday survey of top retail executives.
Putting Amazon to Work for You
Amazon is a classic "frenemy" for retailers: a valuable source of leads for their business, but also one of their biggest competitors. While big retail brands continue to fight the good fight against Amazon's dominance, smaller retailers are finding that the old shtick is true: if you can't beat them, join them. Amazon's advertising is great, sure, but they also have some nifty tools such as pricing bots to help you become more competitive and efficient. One of the places where Amazon truly excels is in creating a superior shopping experience for their visitors. One of the ways that they do this is through efficient and effective advertising that adds to the browsing experience instead of disrupting the flow for the visitor. A great example is their Product Display Ads, which are PPC ads triggered by the interest of a buyer in a particular item. For instance, if you're selling high-end custom shampoo, you may want to target "organic shampoo and conditioner", as people who are used to paying the price of organic products would be an ideal audience for your advertising.
Subtlety Is Best
Amazon is excellent at creating subtle advertising that feels like a natural fit for what you're already searching for. Product ads are scattered throughout the pages, in a variety of different locations. You can pay big bucks to sponsor a segment of the site or a popular search results page, or you try a smaller investment and get a bit further down the page as you're testing your advertising strategy. The good news is that these ads are even more cost-effective than advertising on Bing or AdWords, averaging around $0.35 per click. Plus, there's that whole "ready to purchase" intent that you're not going to find in someone idly scrolling through Facebook or on Instagram, for instance. Amazon's ads feel more like a recommended product than a piece of hard-core advertising, an approach that is quite appealing to jaded consumers.