The events of 2020 set Amazon up for a year like no other, and the company strengthened its grip on the retail and e-commerce sectors accordingly. The e-commerce giant’s net sales grew a whopping 38% year-over-year. Of course, that effect was reflected in a triumphant year for Amazon’s advertising business, which topped $20 billion in revenue last year. In the fourth quarter alone, the company reported fourth quarter ad revenues of almost $8 billion, a 64% year-on-year improvement.
Brands are more aware than ever that whether or not they sell on Amazon, leveraging a presence on the platform can contribute enormously to their broader success. How they achieve that is an ever-changing question.
That’s why Digiday Media’s “Amazon U: Amazon Beyond Search” event brought four industry insiders together to share current best practices, case studies and tips on how to make Amazon work for your brand in 2021. This was the first of three events focusing on different parts of the Amazon ecosystem.
The takeaways will be different for every brand. If you’re newer to Amazon — or simply behind the curve — your action plan may revolve around optimizing your presence and getting to grips with the full scope of what the Amazon ecosystem has to offer. From there, you’ll want to develop an Amazon-specific ad strategy that you can iterate as you measure, learn and retarget. If Amazon is already an integral part of your mix, pay attention to the insights our speakers shared about the new opportunities that are emerging within Amazon, and how their tactics and recommendations may shift in the year ahead.
Price Glomski, evp of digital commerce at PMG, noted that many marketers and advertisers have a love-hate relationship with Amazon, but while there’s always cause for frustration, he said there’s a lot to be excited about right now. With an enormous user base, Amazon already offers dependable display formats and an array of exciting emerging solutions from OTT and Twitch to shoppable Amazon Live streams, dynamic e-commerce ads and voice actionable ads. That portfolio is only going to grow, so get your brand on the front foot and ready to embrace the ever-evolving Amazon juggernaut.
Ad position: web_incontent_pos1
Here is a crash course in how Amazon advertising experts are approaching the 500-pound gorilla.
If it wasn’t already clear, one thing many brands have learned over the past year is that Amazon is so much more than a revenue stream. It’s more than just a marketplace, but also a necessary advertising channel as well as brand building tool.
Ad position: web_incontent_pos2
Amazon has a direct impact on everything the brand does elsewhere. “Most brands that we work with never look at this and it seems really odd to me,” EVP’s Price Glomski said. “Amazon could make up 40% of your gross demand, or in some cases it may make up 2% of your gross demand, but … because Amazon owns 46% of the retail market, you have to look at these together.”
For many consumers, Amazon search, product detail pages (PDPs) and reviews will be the first touchpoint for sales – millions of sales – that will be completed elsewhere. “That’s why it’s really important to put [Amazon] at the front and center when you’re thinking of new product launches, when you’re thinking about research, when you’re thinking about how it impacts your digital ecosystem,” said Ekta Chopra, Chief Digital Officer at Elf Cosmetics.
A consumer’s journey may start on Amazon and cross over to a purchase in your brand’s brick-and-mortar store. And if it doesn’t, that’s fine too. Chopra said Elf is agnostic about where the consumer ultimately makes their purchase. “We focus on showing up as a brand consistently across every single touch point, rather than dictating where the consumer should shop,” Chopra said. “Every time they do shop and we can get that data, we use that data to improve our journey, our creative and our storytelling.”
There’s growing buzz around some of the new opportunities emerging within the Amazon ecosystem. For one, brands are looking at Amazon Live and its shoppable livestreams. This is set to be a new frontier for the influencer industry, with explosive potential across all product categories. Chefs like Carla Hall, for example, have hosted well-received Amazon Live shows, and more brands are playing around with these nascent programs.
Brands are particularly curious about how they can use Twitch as a platform towards building strong relationships with Gen Z audiences. Ekta Chopra said Elf is thinking about Twitch and the initiatives the cosmetic brand has taken, such as partnering with one of the platform’s star gamers, Lufu.
Beyond partnering on individual streams, plans are now afoot for an Elf channel on Twitch. “We’re not treating it as a gaming opportunity,” Chopra said. “It’s a live streaming opportunity, it’s an opportunity to engage with your community in a new and innovative way.”
One common thread at the summit was the importance of laying solid foundations before unleashing your ad dollars. EVP’s Glomski said taking care of the basics first is a must for “endemic” brands (those selling on Amazon). “If your product display pages are broken, if your brand store isn’t enforcement informed, you have a ton of unauthorized resellers in the market, nothing’s optimized, it’s going to break down,” Glomski said.
Julie Weitzner, EVP at Dentsu’s Sellwin Consulting, shared some excellent tips on conducting an audit of your PDPs and brand store. They include:
- Checking that titles are SEO-optimized and your page is fleshed out with strong images and video.
- Ensure that you’re winning the buy box by effectively managing inventory, Prime offerings and pricing.
- Don’t overlook the value of A+ content. “This is your chance to shine below the fold and really bring the brand to life,” Weitzner said.
- Brands might want to prepare FAQs to pre-emptively address common queries, and be sure you’ve exceeded the threshold of 15 verified reviews that PDPs need in order to be promoted.
- Brand stores need to be optimized just as much as PDPs. “It’s your one chance to show your entire product portfolio,” Weitzner said. “Really vary up your assortment and do it in a stylized manner that brings your brand assets to life.”
Glomski, however, noted that it’s not necessarily a good thing to list your entire catalog, as Amazon has encouraged brands to do. A more curated approach, he explained, will benefit companies offering a larger range of products, particularly for consumer electronics and softline brands.
An growing individual brand can only know so much about the Amazon ecosystem. The speakers underlined the importance of having a clear focus on Amazon and identifying partners with the expertise to drive results for your brand. “Unless you’re spending over $10,000 a month on Amazon, you need to most likely be partnering with somebody to help support that,” Glomski said.
That doesn’t mean you can simply hand Amazon strategy passively off to an agency to take care of. Elf’s Chopra said that a brand’s agency partner needs to be “embedded” in the brand’s business to achieve maximum success. “They should be coordinating with operations to marketing to brand to creative so they have access to everything,” Chopra said. Additionally, somebody on the brand side must be assigned to focus on Amazon operations.
The Amazon universe is vast, and it’s easy to get lost amid all the advertising options at your disposal within the platform. What’s right for each brand will differ, but our speakers offered some high-level insights on outlining and developing a strategy.
- Adam Epstein, VP of Growth at Perpetua, recommended advertisers activate using both DSP and sponsored display if they have the budget to do both. Broadly speaking, he said DSP is better suited for activities at the top and middle of the funnel including custom creative and video, competitor conquesting and retargeting.
- Glomski was bullish on the effectiveness of display formats and over-the-top (OTT), although said the latter can be challenging for brands who don’t have commercial creative.
- Glomski also recommended brands devote around 10% of their total ad budget to experimental spending — allocating a recommended minimum of around $10,000 if they want to see meaningful results. Where your brand spends that experimental budget depends on your priorities. For example, OTT and Twitch are better suited to driving awareness.
- However, if you’re more concerned with what Glomski called “owning your aisle,” or nudging consumers towards conversion, lean on Amazon’s range of product display ads.
Glomski discussed one consumer electronics client and how it approached the annual deals day. This brand decided to blanket the Amazon ecosystem over a 48-hour period with a mix of DSP, search, OTT and Kindle Fire advertising.
“We saw the product everywhere,” Glomski said, and the results were astounding: over 500,000 visits to the brand’s store page in the runup to Prime Day and an over 40% increase in year-on-year sales on the day of the event itself.
Glomski attributed those impressive results partly to the experiment with OTT. “We saw it crush,” he said. “Consumers weren’t ready to see that type of product that within OTT and when they did, it became a very highly engaged piece of creative … purchases were made directly and, and just the acceleration of that product across many markets was was pretty exceptional.”
Sponsored Display Product Targeting Ads?
Amazon launched this sub-category of display ads in early 2020. The unique feature of product targeting ads is their strategic placement: these ads feature the brand’s products in contexts where consumers will likely compare them directly alongside rival products. For example, product targeting ads are served alongside user reviews and on PDPs. Adam Epstein of Perpetua described these as the “hot ad of 2020,” and enthused about improved capabilities coming down the pike this year.
“Make sure that you’re enforcing competitor arbitrage … protect your own product by going in targeting your own ASINs and products. That is an easy win, it’s inexpensive and it converts.” — Price Glomski, EVP of Digital Commerce at PMG
Sponsored display product targeting gives your brand an opportunity to compete toe-to-toe for consumers’ eyeballs by placing your ads on your competitors’ PDPs. But if you’re not careful, your competitors will do the same to you. Fortunately, you can shut down the possibility of losing consumers to this kind of leakage by occupying the ad space on your PDPs with your own ads. “Defense is the new offense,” Glomski said.
“The brand presence has to be consistent with everything else that you’re doing with your content, your storytelling. Don’t treat it as one of those things that you just put it in there. Whatever you do for your own channels, you should be thinking about how to incorporate that into Amazon as well.” — Ekta Chopra, Chief Digital Officer at Elf Cosmetics
A brand’s Amazon presence doesn’t exist in a silo. It’s an extension of the way your brand presents across your owned channels and every other space you operate in, and your PDPs, brand store and advertising should reflect that. As brands look to engage new audiences, like Gen Z, Chopra emphasized the importance of making sure that your Amazon spaces communicate your brand purpose in clear terms.
“Make sure that when it comes to the measurement, everything doesn’t get measured on ROAS.” — Julie Weitzner, evp at Sellwin Consulting, Dentsu
Developing a sophisticated measurement system capable of capturing data at every point of contact along the sales funnel gives a brand sophisticated tools for tweaking its ad strategy at a granular level. Weitzner pointed out that each customer’s Amazon login is the key to a first-party data trove like no other, covering everything from buying patterns, delivery locations and search habits — offering brands insights that allow them to go far beyond ROAS.