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Amazon Marketing Services (AMS)Strategies and Guidance
EDITORSMARC AUFZUGDOMINIK BORS
MEMBER OF
Q1 2017
GO STRAIGHT PAST GO: MONOPOLY 2.0Why Amazon Marketing Services (AMS) is the new and improved Google AdWords, and how brands and manufacturers can secure the key competitive advantage.
ENG
Contact details
factor - a
The Global Marketplace Group GmbH
Brüsseler Str. 89 – 93
50672 Cologne, Germany
Telephone + 49 221 177 337 10
Email info@factor - a.com
TABLE OF CONTENTS
Preface ..................................................................................................................................... 3
About factor - a – The Global Marketplace Group ............................................................................ 4
About the Editors ....................................................................................................................... 5
About the Author ....................................................................................................................... 6
CHAPTER 1 AMS: Properties, Houses and Hotels ............................................................................ 7
CHAPTER 2 Amazon Marketing Services: Three Types of Advertisements for Maximum Success ........... 14
CHAPTER 3 How to Strategically Utilise AMS Advertising Campaigns .............................................. 23
CHAPTER 4 Tactical Tricks with AMS Products .............................................................................. 36
CHAPTER 5 The AMS Rocket ..................................................................................................... 43
Expert Interview ...................................................................................................................... 44
3
PREFACE
Amazon Marketing Services is currently the most effective
digital marketing tool.
Today, the greatest percentage of product searches on the internet starts
at Amazon, while Google increasingly loses ground. That makes Ama-
zon the #1 search engine when it comes to shopping. The majority of
Germans have an Amazon account and an ever - growing amount of on-
line shoppers purchase their products on Amazon several times a month
via Prime. If product searches are mostly conducted on Amazon and
Amazon concurrently attains the highest conversion rates, then the log-
ical conclusion is that sales and marketing budgets are most effectively
spent right there. Via Amazon Marketing Services and its various forms
of advertisements, manufacturers and brands present themselves exactly
where customers get their information about products – and purchase
them. At the same time, Amazon Marketing Services is still in its infan-
cy, like Google AdWords and other online marketing methods from the
early 2000s. Manufacturers who get involved right at the beginning and
position themselves professionally obtain a significant competitive ad-
vantage, secure the relevance of their brand and instantly increase their
e-commerce sales.
Go straight past Go! factor - a will show you how it works.
Yours truly,
Marc Aufzug,
Marc Aufzug, CEO of The Global Marketplace Group GmbH
Marc Aufzug
CEO of The Global
Marketplace Group
4
ABOUT FACTOR - A – THE GLOBAL MARKETPLACE GROUP
factor - a is part of The Global Mar-
ketplace Group GmbH (TGMG)
and councils manufacturers and
brands in every operational as-
pect of sales increase, brand lea-
dership and quality management
on Amazon. factor - a is the leading
consultancy firm in this field and
describes its own approach as
holistic, international and techno-
logy driven. Holism comes from
the synergy of product data and
Contact details
factor - a – The Global Marketplace Group GmbH
Brüsseler Str. 89 - 93 | 50672 Cologne, Germany
Telephone + 49 221 177 337 10
Email info@factor - a.com
Visit www.factor - a.com and www.tgm.group
content optimisation (MPO), mar-
ketplace advertising (MPA) as well
as the entire data-driven account
management (MPI). Operational
excellence across all three areas
leads to a genuine competitive
advantage and thus to a signifi-
cant increase in sales on Amazon.
factor - a offers all its services for
every relevant language region,
provided by native speakers on site
in Cologne. Additionally, factor - a
realises technological solutions in
the context of Amazon with its own
team of developers and thus gives
manufacturers and brands a head
start.
Under the umbrella of TGMG,
brand manufacturers can also
profit from specialised full-service
Marketplace Management on eBay
as well as on the Chinese online
marketplaces JD and Tmall via the
subdivisions factor - b and factor - c.
Nils Zündorf Head of Paid Advertising
Speak with the authorSchedule a free phone consultation today!
+ 49 221 177 337 10
info@factor - a.com
5
ABOUT THE EDITORS
Marc Aufzug is an executive director of The Global Marketplace Group
GmbH and a consultant for manufacturers and brands regarding operatio-
nal marketplace management on Amazon via the business division factor - a.
Marc has long - term entrepreneurial experience and expertise in the fields
of e-commerce and agency setup. By means of more than eighty successful
consultancy projects in the areas of Amazon content optimisation, e-com-
merce marketing (Amazon Marketing Services, among others) and Ope-
rational Excellence in continuous growth management, he and Dominik
Bors have established factor - a as the leading service provider in supporting
brands and manufacturers on Amazon.
Dominik Bors (qualified computer scientist) is an executive director of The
Global Marketplace Group GmbH and a consultant for manufacturers and
brands regarding operational marketplace management on Amazon via the
business division factor - a. Dominik has long - term experience and expertise
in the setup of software development teams, in the field of e-commerce and
in entrepreneurship. factor - a considers itself a technology partner with a fo-
cus on scalable and data - driven solutions for manufacturers and brands on
Amazon. The technology - based counselling process is the foundation for
sustainable growth in online marketplaces.
Marc Aufzug
marc.aufzug@factor - a.com
+ 49 221 177 337 10
Dominik Bors
dominik.bors@factor - a.com
+ 49 221 177 337 10
6
ABOUT THE AUTHOR
Nils Zündorf manages the Amazon marketing division of factor - a. For
more than ten years, he has acted as a consultant and specialist in
e-commerce, especially concerning the development and scalability
of paid advertising campaigns. Doing so, he interconnects the startup
culture with the corporate world, online with offline businesses and
new paths with established patterns. With his focus on online market-
ing and customer touchpoints, he pursues the objective of making the
most of every single penny – regardless of the available budget. With a
degree in Business Information Management, he is able to reinforce his
concepts with respective technological frameworks and thus can de-
monstrably achieve recurring and persistent successes for his clients.
He is particularly interested in the marketing channels and campaigns
which are continually optimised and fostered, like Amazon Marketing
Services and the Amazon Advertising Platform.
Nils Zündorf
Head of Paid Advertising
+ 49 221 177 337 10
7
CHAPTER 1 AMS: PROPERTIES, HOUSES AND HOTELS
What Amazon Marketing Services has in common with
the real estate industry
“They really made a good bargain
back then. Now their flat is worth
double what they paid!”
“I should have nabbed that place
when it was still cheap…”
“I know it’s too expensive, but we
had to buy it quickly before the
price went up even further.”
Who has never heard these sen-
tences in a circle of friends and
acquaintances? Real estate prices
are constantly soaring, for several
reasons: not enough properties
are available on the market, rent is
increasing and other investments
are not as profitable anymore.
More and more, the acquisition of
property is considered to be the
only reasonable option – even if
the prices are already steep. Con-
sequently, prices will continue to
rise even further, which will in turn
fuel the entire process. It is no co-
incidence that the media frequent-
ly utilises the metaphor of the
game of Monopoly in its myriad of
reports about the rising real estate
prices. If you take a look at the de-
velopment of Google AdWords,
a similar structure becomes appa-
rent: as Google soared to beco-
me the indisputable global mar-
ket leader of search engines in
the early 2000s, the competition
and thus the prices for Google
advertisements increased to the
same extent. Suddenly, classified
advertisements became highly
competitive for many keywords
and had to be bought due to the
ever - advancing cost per click. The
supply – in this case, the number
of relevant keywords for a specific
product, service or information
– remained constant despite the
increasing demand. Subsequent-
ly, the prices for keywords such as
holiday and life insurance were so
expensive that booking them only
made sense in a few business mo-
dels.
Nowadays, companies and
corporations – just like real estate
buyers in German metropolises –
must draw up huge budgets and
pay the proverbial heavy price for
Google AdWords campaigns. You
cannot blame real estate buyers
for wanting to turn the clock back
ten years. They wish they were
at the beginning of the 2000s
when entry level prices were still
affordable and they could build
a solid competitive position from
that foundation. The players long
for a situation that is similar to
that at the beginning of a game
of Monopoly, when properties are
cheap, income comes from rent,
property colour groups are attain-
able and the financial foundation
for building houses and hotels is
laid.
It is exactly this situation and
unique opportunity in e-commerce
and online marketing that is now
available for brands and manufac-
turers on Amazon. Search engine
marketing is the most promising
marketing channel because the
potential buyer is confronted with
a tailor-made advertisement in
the moment of a consumer’s max-
imum willingness to purchase. The
success of Google AdWords rests
exactly upon this principle. How-
ever, the ever-growing numbers of
product searches (or transactional
searches) are no longer conduct-
ed on Google, but rather direct-
ly on Amazon. Today, Amazon is
the #1 product search engine in
8
the US. When brands and manu-
facturers address their potential
customers here – in the search re-
sults on Amazon – the probability of
purchase is exponentially higher
and unmatched – neither by retail
shops nor by other e-commerce
platforms. Amazon SEO has sup-
planted Google SEO and Amazon
Marketing Services is supplanting
Google AdWords. The difference
is that the companies now hold the
cards: due to the similarities bet-
ween Google AdWords and AMS,
brands and manufacturers can an-
ticipate future developments and
avoid mistakes made in the past.
The cost per click within Amazon
Marketing Services is still consi-
derably cheaper than within the
Google Ads system. If brands and
manufacturers utilise Amazon
Marketing Services efficiently, they
will also achieve a better position
in the “free” organic search results
and thus procure the competitive
advantage in the long run. It is
almost like being able to buy rea-
sonable flats in Hackney, London
again.
Why AMS is going to become
the next Google AdWords
How can Amazon attack Google’s
supremacy in search engine adver-
tising (SEA)? The simple search
entry field below Google’s colour-
ful logo seemed to be the unrival-
led gatekeeper to the internet a
few years ago. It answered every
question one could think. It has
even become its own verb – “to
google”– which is used when look-
ing for information and content
on the internet. This is the cross-
road where a new junction has
been formed. While content and
information are still searched via
Google, Amazon is already the #1
player when it comes to product
searches. Customers have learned
that Amazon’s assortment is uni-
versal and it provides the most
comprehensive range of products
including information and reviews.
Amazon gives customers informa-
tion about whether a product is
available and which price range is
realistic.
Amazon benefits threefold
from this development. Firstly,
sales numbers increase because
Amazon’s assortment often has the
best value for money. Secondly,
modified search behaviour boosts
customer loyalty. Amazon shop-
pers have complete faith in the
site and have stopped checking
other offers. Lastly, this growing
supremacy gives Amazon the op-
portunity to harvest a new revenue
stream: the more Amazon is used
as a search engine, the higher the
value of the advertising spaces. For
advertising corporations, brand
manufacturers, as well as for re-
tailers, Amazon Marketing Services Where did online product searches start in 2015 and 2016: Amazon dominated 55% of product searches. Source: BloomReach survey, 2016
Where do online product searches start?
0%
40%
70%
2015 2016 2015 2016 2015 2016
Amazon Search engines Retailers
55%
28%
16%
44%
34%
21%
9
is emerging as a welcome and
attractive alternative to the simi-
lar infrastructure that helped Ad-
Words strike gold for Google.
Like Google, but more
powerful
Regarding structure and imple-
mentation, Amazon’s AMS is quite
similar to Google AdWords. Ad-
vertisements based on keywords
are displayed prominently above,
in between or under the organic
search results. Advertisers only
pay when customers click on their
ad. A budget is drawn up and
the advertising spaces are then
sold per keyword via a bidding
process. Although the process
sounds like Google’s, advertising
via AMS have at least one crucial
advantage: the majority of those
searching on Amazon already have
a clear disposition to buy, are regis-
tered users, and have had positive
purchase experiences on this plat-
form. Thus, the trail from search-
ing – via the search results – to the
shopping cart is considerably
shorter than it is on Google, where
customers might be led to an un-
familiar online shop and must first
register or create a new account.
The conversion rate, i.e. those who
actually make a purchase after their
visit, is considerably higher on
Amazon than with traditional Ad-
Words marketing and its respec-
tive online shops.
The Monopoly Venture:
act early
Amazon Marketing Services (AMS)
as a search marketing channel is
still in its initial stages of develop-
ment, but Amazon is pursuing a
leading role in paid advertising.
It was already deemed compe-
tition by Google’s former CEO,
Eric Schmidt, back in 2014: “Our
biggest competitor in search is
Amazon.” This game of Monopoly,
which becomes apparent in light
of the past AdWords boom, is still
up in the air, and the competition
for advertisements on Amazon is
still low. However, the game has
already begun. For the first time,
manufacturers and vendors can
be locked into a single corpora-
tion not only through sales, but
also through marketing activities
as well. This is due to the fact
that potential competitors – other
e-commerce platforms with mar-
keting ambitions – are choked off
by Amazon’s purview and infra-
structure, in the same way Google
outstripped Yahoo and AltaVista,
among others.
It is understandable that brands
and manufacturers intuitively hes-
itate at the idea of exposing them-
selves to this kind of market power.
At the same time, however, this de-
velopment is set in stone and from
the digital developments of the
past, one can draw the conclusion
that the perfect moment to deal
with issues has already passed.
The competition has already start-
ed gathering pace. Established
brand manufacturers who under-
estimate the importance of this
particular issue will have to accept
heavy losses later on, caused by
faster competitors and newcomers.
Presently, there is still precious el-
bow room: manufacturers and ven-
dors can increase their sales for a
relatively low price, and also bet-
ter their Amazon search algorithm
ranking and acquire strategic
know-how for the upcoming revo-
lution in e-commerce marketing.
In today’s e-commerce environ-
ment, scaling a company while in-
creasing profitability can best be
done through AMS. To use the
Monopoly analogy: the properties
are currently being sold and the
first rental income has been gener-
ated, which in turn is being invest-
ed to build houses and saved
for later use on hotels. In many
categories, Google has already
expended itself in terms of price;
Amazon, on the other hand, still
has lots of attractive categories
with affordable keywords and little
competition. Therefore, enormous
impacts can be yielded with very lit-
tle budget, especially when it comes
to new product line launches. Po-
tential shoppers are addressed
where they frequently search for
products and where their data is al-
ready on file. Another good reason
10
for acting now is Amazon’s increas-
ing growth rate, which is not likely
to subdue in the coming years.
Since a higher number of people are
using Amazon as a product search
engine, more customers translate
to an increase in sales.
The AMS Fund: visibility,
turnover and knowledge
How do I increase the visibility of
my products on Amazon? What
can I do immediately to have a sig-
nificant increase in sales? Which
keywords work especially well and
should be integrated into the con-
tent of my product? All these ques-
tions can be answered by using
What is ACoS?
ACoS (“Advertising Costs of Sales”)
is the proportion of advertising
costs for a certain campaign or key-
word and the Amazon sales gener-
ated with it.
Attention!
The costs of sales calculated by
Amazon (“Advertising Costs of
Sales” or ACoS) refer to the sticker
price (incl. VAT), not the purchasing
price Amazon pays the manufac-
turer. If manufacturers within the
vendor program do not take this
difference into account, AMS data
can appear distorted. (For more
information see Chapter 4, Step 2:
Analyse and continuously optimise).
Amazon Marketing Services. AMS
enables brands and manufacturers
to quickly resolve the most relevant
issues of their Amazon activities,
which is crucially important for
staying in the game. For one, ma-
nuf ac turers c an learn how to
precisely control their sales via
Amazon search ads. Secondly,
AMS users can become more in-
dependent of the organic search
results on Amazon. Brands and
manufacturers can still quickly
and signif icantly increase their
visibility in organic search results
through search engine optimisa-
tion on Amazon (“Amazon SEO”).
Even if content is the basis for
successfully selling on Amazon,
this alone will not be sufficient in
the future to differentiate oneself
from the competition.
Equally important is the edge
in experience and knowledge
that AMS provides: Corporations
which learn their lessons with Ama-
zon Marketing Services early and
optimise their budget according-
ly, will have already advertised
successfully and profitably when
competitors start using AMS. To
use the Monopoly analogy once
more: the capital for more dif fi-
cult times must be saved up early.
When all the properties of a colour
are sold, they can be built upon,
while late entrants pay high rents
and can only purchase single pro-
perties.
The Main Pillars in the Amazon
Marketing Mix: AMS and AAP –
the perfect instruments for an
increase in sales, visibility and
external traffic
As Amazon Marketing Services is
still a young marketing tool, corpo-
rations can currently increase their
chances and shares within a grow-
ing market for a relatively small
price. No other marketing tool on
Amazon has such a profound im-
pact on sales and turnover.
In addition to Amazon Market-
ing Services, Amazon provides
a variety of other marketing op-
portunities – from automatized
mailings to certain Amazon target
groups (Email Marketing) via dis-
play marketing campaigns control-
led by Amazon and individualised
shop websites (“Brand Shops”)
to the so-called Vine programme,
with which manufacturers and
brands generate customer reviews.
Another milestone in online
marketing, and the entire field of
media, is the recently launched
Amazon Advertising Platform
(AAP), which provides the oppor-
tunity to individually and specifi-
cally modulate display campaigns
and scope campaigns. Via AAP,
advertisers can access Ama-
zon-owned inventory, like the
Amazon platforms (i.e. amazon.
com), Kindle or FireTV, as well as
all relevant display networks wor-
ldwide. The revolutionary part of
1111
AAP is that media range relates to
Amazon’s anonymous user data.
No other company has better and
more accurate information on the
buying behaviour and interests of
online shoppers around the globe.
This opens up new horizons of ran-
ge and visibility in e-commerce and
will permanently change the who-
le media and display marketing
sectors. By relating media reach to
this data treasure, the efficiency of
display marketing campaigns can
be elevated to a whole new level.
Via the Amazon Advertising Plat-
form, brands and manufacturers
can specifically book marketing
slots to advertise to target groups,
thus driving external traffic to their
product detail pages on Amazon.
This simply means that media
budgets can be used much more
efficiently, measurably and directly
for the sale of products on Ama-
zon. The enormous potential that
AAP has to offer is still, like Ama-
zon Marketing Services, in its in-
itial stages of development. The
specific applications and functio-
nality of the Amazon Advertising
Platform will be thoroughly dis-
cussed in the next white paper.
The Objective: Quick first
steps and strategic setup
Amazon Marketing Services cur-
rently is to the e-commerce busi-
ness what urban districts like Kreuz-
berg, Berlin or Hackney, London
were to the real estate industries
at the turn of the millennium, a rela-
tively unknown area with enormous
potential. Today, real estate in these
districts is comparable to certain
keywords in Google AdWords:
The Amazon Advertising Platform (AAP) combines the full media range with Amazon’s user data. Source: Own illustration
Amazon Advertising Platform (AAP)
Access to premium content (Amazon and all other
premium content sources)
Exclusive Amazon first -party data and cross device ad targeting
Amazon Advertising Platform (AAP)
12
they are overpriced and thus far from
being efficient. At the turn of the mil-
lennium, some people recognis-
ed the charm and future value of
a flat in an old building in need of
redevelopment and jumped into
uncharted waters. The modest
prices allowed them to buy real
estate and to learn which were
profitable and where demand was
high. In the field of Amazon Marke-
ting Services, the relevant keyword
can only be bought temporarily.
Therefore, it is key to test and filter
out the most profitable options.
Testing search terms on Amazon
occurs currently within a relatively
keen market environment, which
translates into being able to take
on the competition with the advan-
tage in knowledge and optimised
listings.
Selecting the best keywords,
whose value will increase later on,
for a specific product is a multi-
layered process. Corporations
should keep an eye on how they
allocate resources to have the best
possible impact in the short term.
Even more important is setting the
course for being well-positioned
compared to one’s competitors.
When you own complete colour
groups in Monopoly, you can build
houses and hotels on them and
make your opponents pay up. The
same applies to AMS: worthwhile
investments are now being made
in the form of improved organic
search result rankings. If you have
the best performing keywords, you
can strain the competitor’s results.
Which strategy is best to start
with, what corporations should
keep in mind and which objectives
are realistic will be discussed in
the third part of this white paper.
Furthermore, success stories from
the field will be presented before
elaborating on tactics for the day-
to-day work with AMS. We will also
provide detailed tips and tricks on
how brands and manufacturers
can successfully integrate these
ideas. The following chapter will
comment on the various types of
ads included in Amazon Marketing
Services.
13
The positioning of Sponsored Products, Headline Search Ads in the search results and Product Display Ads on the product detail page (f.l.t.r.). Source: Amazon
CHAPTER 2 AMAZON MARKETING SERVICES:
THREE TYPES OF ADVERTISEMENTS FOR MAXIMUM SUCCESS
The Structure of Amazon Marketing Services
Amazon Marketing Services (AMS)
mainly consists of three different
display types, all of which fetch the
customer in various stages of the
search and buyer decision process:
• Headline Search Ads (HSA)
• Sponsored Products (SP)
• Product Display Ads (PDA)
Headline Search Ads are presented
to the customer at the beginning of
the buyer decision process and en-
able the advertiser to inform custo-
mers about the brand and to lead
them to a specific land-ing page.
One step further in the buyer‘s deci-
sion process, Sponsored Products
Ads are listed next to the organic
search results. They are the equi-
valent to classified advertisements
on Google and the only thing dis-
tinguishing them from the orga-
nic search results is the tiny hint
“Sponsored Product” or “Sponsor-
ed” above or below the ad. SPAs
are the most ef fective display
type when it comes to increasing
sales on Amazon, since the promi-
nent placement of a product can
be achieved independently of
the organic ranking. Both Headline
Search Ads and Sponsored Pro-
ducts Ads are based on keywords.
On individual product detail
pages – i.e. at the end of the buyer
decision process – Product Display
Ads can be utilised. These are ban-
ners which are mostly displayed
above or below the Buy Box or at
the bottom of the product detail
page. In this case, potential custo-
mers are not directly addressed
within the search process, but
rather immediately before the pur-
chase decision. This display type
is best suited for cross-selling and
up-selling within a particular pro-
duct range – or, alternatively, to
advertise your products on your
competitor’s product detail pages.
Whereas Sponsored Products
and Product Display Ads are linked
to a specific product detail page,
Headline Search Ads can lead to
three different pages: a product de-
tail page, a targeted selection of
14
products – i.e. a brand page or a
best-sellers list, or another web
page defined by the advertiser
inside of the Amazon ecosystem.
Thus, an individual list of search
results with in-house products, as
well as a brand page, can be hy-
perlinked. Moreover, customers of
Amazon Marketing Services (AMS)
can be directed to a specifically
designed campaign page, the set-
up for which is complimentary.
There are templates available
for presenting complete product
lines in a visually pleasing manner,
as well as text intensive options,
which are best suited for longer
brand and product descripstions.
Consequently, it is not only
important to completely com-
prehend the respective display
types within AMS and to apply
them purposefully, but also to link
the most suitable landing page
with its respective product detail
page. Corporations which want
to make potential customers awa-
re of their brand should choose a
combination of relevant keywords,
coordinated Headline Search Ads
and a visually appealing campaign
page. Companies which want to
drive the sales of a certain product
should, on the other hand, adver-
tise this specific product by means
of Sponsored Product Ads.
Best Practice
The landing page of the Headline
Search Ad (HSA) should be tailored
to the exact wording of its respective
keywords. HSAs booked on general
keywords like “Speedo” or “Lego
toy” should, for example, be linked
to an overview page, like the brand
or campaign pages.
Meanwhile, HSAs booked on more
specific search terms like “Speedo
bathing suit” or “Lego castle” should
at best drive customers to a page
with an overview of the respective
products or even to one specific pro-
duct detail page.
Display Types Sponsored Products Headline Search Ads Product Display Ads
CostsCost per click,
Auction principleCost per click,
Auction principleCost per click,
Auction principle
Display ConditionsBased on keywords or auto-
mated output by AmazonBased on keywords
Based on target groups, categories or ASINs
Ad locationAbove or beneath the
organic search results & on product detail pages
1 Ad above the search results page
Ad beneath or next to the Buy Box; banner on
the search results page
Customisable noLogo, title and ad copy; up to 3 product images;
landing pageLogo, title and ad copy
Ad Efficiency
Advertising-Sales Ratio (ASR)
AMS Display Types at a Glance
AMS display types at a glance – Sponsored Products have the best advertising-sales ratio (ASR). Source: Own illustration
15
This secures them a good rank-
ing while using a few important
keywords to guide the customer
directly to the respective product
detail page. A matrix of the most im-
portant strategic objectives and
the associated AMS activities will
be presented in Chapter 3. The
campaigns are sold by means of
an auction principle which is quite
similar to the one used by Google
AdWords: Advertisers place
a cost per click bid on a specific
advertising space. On the basis
of the chosen maximum bid – and
other factors, including relevance
and availability – Amazon decides
when and where the advertise-
ments will actually be displayed.
Campaigns can be set up starting
from a budget of 100€ or a daily
limit of 1€. We recommend a me-
dium four-figure budget, depen-
ding on the product category and
the range of goods, as a starting
point, which provides the oppor-
tunity to test and optimise diffe-
rent campaigns and thus to attain
the necessary knowledge about
the performance of isolated cam-
paigns.
Hereafter, we are going to take
a closer look at the three display
types. Plus, we are going to dis-
close best practice tips for the set-
up and adjustment of the individu-
al display types. It should be noted
that the optimisation of the product
data and the content should al-
ways precede the maketing activi-
ties on Amazon. Products that are
being advertised through AMS
should already have optimised pro-
duct titles, feature bullet points,
product descriptions, images and
keyword sets. Otherwise, enor-
mous potential and the advertising
budget are wasted. Another thing
that can increase the conversion
rate significantly is A+ content,
which is an enhanced product de-
scription with rich images, charts
and narrative copy. Likewise, you
should check customer reviews
and answer customer questions to
help shoppers make an informed
buying decision and to increase
your conversion rate. Poorly rated
and displayed products adverti-
sed within the context of AMS are
not very efficient and – at worst
– for nothing because customers
addressed via display ads are very
likely to turn away from a poor pro-
duct detail page. In these cases,
the conversion rate is very low and
the just campaign was for nought.
Headline Search Ads
Headline Search Ads are displayed
directly beneath the search bar
and above both the organic search
results and the Sponsored Prod-
ucts, which makes these ads the
high-end real estate of all the dis-
play types.
HSAs provide the opportunity
to select an image as well as an ad
copy of one’s choice. The ad copy
can be phrased according to a cer-
tain target group, which usually in-
creases the click-through rate (CTR)
significantly. Advertisements with
an extremely low CTR (ca. 1%) with-
in a certain campaign will be cut
off by Amazon and cannot be acti-
vated again. Headline Search Ads
are eminently suitable for brand
promotion and using them makes
the most sense in cases when the
shopper has not yet voiced their
preference for a particular brand.
When customers are looking for
“sunscreen,” they most likely do
not have a specific manufacturer
– much less a certain product – in
mind. Due to its prime location,
the prominent positioning of this
display type is best suited for draw-
ing the attention of the potential
customer.
Apart from a product image
and a brand image on the left side,
as well as a customised ad copy,
three products from the product
range can be selected to be dis-
played in the HSA.
Best Practice
The different AMS display types can
be booked for the same keywords si-
multaneously. Since the campaigns
within the same account do not
compete, one can easily experiment
which approach and which display
type yields the best results.
16
After clicking, the user is unre-
strictedly forwarded to a favou-
red landing page within the Ama-
zon cosmos. It is necessary for at
least three products to be fea-
tured. Otherwise, Amazon will not
allow you to start the campaign
or will stop it if less than three are
shown. This way the target is a
pre-filtered search results page,
a specifically designed campaign
page or an already existing brand
shop. Headline Search Ads, which
also display individual products, al-
low the advertiser to provide up to
four different links. Apart from the
link redirecting the customer to a
specific brand shop or campaign
page on the left side of the adver-
tising space, the user can get to the
product detail pages of every sing-
le product being promoted in the
respective Headline Search Ad.
HSAs can only be displayed for
specific long tail keywords or pre-
cisely matching search requests.
Unlike Sponsored Product Ads,
they cannot be automatically dis-
played by Amazon, which means
that advertisers have to custo-
mise their HSAs. On the upside,
Amazon does provide related
search terms with appropriate
search volumes in this format,
making the creation of a wide-
coverage keyword set quite easy.
Best Practice
Currently, Amazon disregards word
variants!
Thus, advertisers must enter varying
terms manually and possibly even
have to defer to common misspel-
lings within a product segment.
Apar t f rom the word “vacuum
cleaner,” it is worth including re-
gional versions like “ hoover,” as
well as terms l ike “vacuum” or
“vac” in the campaign.
Example: Headline Search Ad
The Headline Search Ad for the keyword “cat food” using the example of Whiskas – customised ad copy as well as three freely selectable products. Source: Screenshot Amazon
17
As mentioned, HSAs are very
popular and thus often on. There-
fore, keywords which do not
match the HSA perfectly can lead
to unprofitable campaigns. For
this reason, the start of a HSA
campaign should always follow
a detailed analysis of the imple-
mentable keywords.
The advertising spaces for this
display type come at a premium.
Consequently, Amazon cycles
through various campaigns, up
to four, at a time. Additionally,
Amazon provides an indicator
for the minimum bid price on the
most popular keywords, which
displays the correlation between
the bid price and the frequency
with which the advertisement is
displayed.
Brand manufacturers
in a tight spot
Headline Search Ads have strate-
gic significance for brand manu-
facturers. The prominent position-
ing of these ads creates fantastic
opportunity as well as the biggest
risk. Manufacturers are increasing-
ly compelled to create Headline
Search Ads for their own brands
and use product line keywords
before their competition has the
same idea. Apart from attracting
new customers and introducing
product innovations, this display
type is well-suited for protecting
one’s own brand. Manufacturers of
sunscreen can, for example, occu-
py brand-oriented keywords such
as “Nivea sunscreen” or “Garnier
sunscreen” to ensure that shoppers
looking specifically for that brand
are led directly to their own pro-
ducts without getting distracted.
Nonetheless, advertisers should
also increase their range by inclu-
ding occasion-related and brand-
oriented keywords. As a result of
the current negligibility of the
competition, cost per click bids of
only a few cents can already yield
enormous results. The current
cost-benefit-ratio of this display
type is very positive, especially
for high-potential niche brands
which still snatch an exceptionally
low ACoS for their respective se-
arch terms. Since sellers also have
their foot in the game by using
HSAs, the cost per click of this
display type will probably rise in
the future.
Sponsored Products
This is the AMS display type
which can be utilized by both ven-
dors and sellers. Sponsored Prod-
ucts is the crown jewel of Amazon
Marketing Services – or, to use the
Monopoly analogy again, it is the
most profitable short-term proper-
ty in the game. Of all the ad types,
this is the one that is displayed
most often. The great part about
these ads is that they are displayed
like the organic search results – the
only difference being an unobtru-
sive “sponsored” tag in grey let-
ters. Many users and customers do
not even realize these display ads
are advertisements. If the selec-
tion of relevant keywords fits their
search criteria, customers will un-
knowingly allow an advertisement
to influence their purchase. If ap-
plied correctly, Sponsored Prod-
ucts is certainly the high-selling dis-
play type within the AMS portfolio.
Sponsored Product campaigns can
be set up manually by the brand
manufacturer or automatically by
Amazon. In the case of automatic
campaigns, algorithms allocate
an advertisement’s respective
keywords. The manual control, on
the other hand, allows for a precise
displaying of the ads matched to
certain search terms. Both cam-
paigns can run simultaneously.
The likelihood of these ads
being displayed in the organic
search results can be increased
by adjusting the bid prices. Bid+
allows for additional bidding on
ads with the best positions above
the search results. In the real esta-
te industry, this is comparable to a
well-situated property in the prox-
imity of local transport and shops.
Another important location for this
display type is on the individual
product detail pages where Spon-
sored Products Ads are embed-
ded in the recommendations
(“Sponsored products related to
18
this item”). Analyses show that ads
on product detail pages represent
a significant part of the turnover,
especially when they are auto-
matically displayed by Amazon.
Great purview and intense
competition
When the price and the reviews of
promoted products are compel-
ling, Sponsored Product ads – with
their various possible positions
taken into account – provide an
enormous product presence with-
in the organic search results. Poten-
tial customers who are presented
products independent of a brand
are more likely to click on the ad
because they perceive it as an or-
ganic search result. This advantage
has its own drawbacks as it great-
ly influences the cost per click.
Sponsored Products is undoubt-
edly the AMS display type with
the most intense competition for
the hottest product segments and
Sponsored Products within the “pen” category. In this case, there are actually three Sponsored Products above the organic search results and several on the side. Source: Screenshot Amazon
Best Practice
The keywords won in automatic cam-
paigns can be integrated and further
optimised in manual campaigns.
Amazon then automatically and
autonomously takes over the basic
keyword research.
The respective search terms should
also be designated to the appropri-
ate product detail pages to increase
the relevance of these listings.
Example: Sponsored Product Ads
19
keywords, particularly since sellers
can also participate in the bidding
with attractive individual offers.
The best-placed bids (resp. Bid+)
should nevertheless only be tested
within campaigns with empirically
established figures to guide the
decision if an additional invest-
ment, based on reference values,
is worthwhile. In our tests, Bid +
always leads to better results
because the conversion rate of
the top placed products was sig-
nificantly better, which also increa-
sed the ACoS. Here, a bidding war
can be triggered very quickly, the
result of which nobody will like.
Similar to the Headline Search
Ads, Sponsored Products can be
utilised either defensively or of-
fensively. If you do not bid on the
relevant keywords for your brand,
remember that in many cases the
competition will try to steal your
potential customers by occupying
keywords relevant to your brands.
The grass is certainly greener on
the other side; however, keep in
mind that stealing customers away
from your competition by using
the same approach could actually
backfire. The extent to which this
is a profitable approach should be
evaluated in each case by means of
a potential analysis.
Sponsored Products Ads are
especially advantageous when it
comes to increasing sales of newly
introduced products or those with
long standing low rankings. Not-
withstanding new or previously
disregarded listings, this type of
display helps products reach top-
listing status, thus improving their
visibility and increasing their sa-
les. Moreover, it is a convenient
tool for finding the hidden top-
sellers in a specific product ran-
ge: if f ive products undergo a
Sponsored Product treatment
under equal conditions, some
of them yield better results than
others, even though they have
the same budget.
Within the scope of a so-called
twister, i.e. the bundling of sever-
al versions of a product onto one
product detail page, those pro-
duct versions can all be promo-
ted with a single advertisement.
Twisters increase the chance
that potential buyers f inding
their preferred produc t and
thus decreases the number of
users backing out of the purchase
process.
Best Practice
Defensive and offensive campai-
gns should be set up separately
from other campaigns so that the
Average Cost of Sales (ACoS) can
be evaluated according to its re-
spective objective.
Product Display Ads
The appearance of a Product Dis-
play Ad is extremely customisable
and enables advertisers to address
potential customers in a later stage
of the buying decision process.
PDAs are currently only available
to vendors, not to sellers. Nor-
mally, they are displayed directly
beneath or next to the Buy Box on
a product detail page, but a spot
under the navigation menu on the
search result page is also possible.
The strength of this display type
is that Product Display Ads draw
the interest of potential customers
already interested in the product.
Visitors to a product detail page
whose eyes are wandering towards
the Buy Box have clear intentions.
Since they are already planning on
buying specific product, shoppers
could also perceive these display
ads as a mere distraction and over-
look them completely.
Product Display Ads are the
only display type within the AMS
portfolio to provide the opportuni-
ty to address target groups inde-
pendently of their current online
search and the product detail page
they are momentarily on. There are
three options available: they either
address a previously defined tar-
get group (“interest-based target-
ing”), or a specific product (“pro-
duct targeting”) or target a whole
category.
20
For interest-based targeting,
Amazon uses the purchase history
as well as the general surfing be-
haviour of its users and visitors.
Thus, very nuanced target groups
can be selected and combined
when setting up a campaign. Un-
fortunately, these previously de-
fined target groups are a black
box, meaning that only Amazon’s
algorithm knows how visitors have
been allocated to the various tar-
get groups. Likewise, the surfing
and purchasing patterns of cus-
tomers on the website are also
kept secret. If matching segments
for in-house products are missing,
the Amazon Advertising Platform
(AAP), with its fine-grained modu-
lation options, may be the more
efficient alternative.
Product targeting is another
modulation option of Product Dis-
play Ads and works based on ASINs
(the article number used by Ama-
zon). The centre of focus changes
here from the customer to the
buyer’s decision process. The pro-
moted product either substitutes
or complements the planned pur-
chase. Typical examples of this are
the less-expensive generic prod-
ucts to brand name products and
vice versa, as well as commodities
and accessories which can be
advertised on the product detail
page of its matching main product
(cross-selling, up-selling). Compa-
nies that have a suitable product
in their range and want to create
campaign setups with low expen-
ditures can place an ad in related
categories. For example, it is pos-
Two types of Product Display Ads used for cross-selling which target the high traffic Apple iPhone. Source: Screenshot Amazon
Best Practice
Within this display type, the prod-
uct title can be customised and a
logo can be added. This has the ad-
vantage that longer product titles
which are often optimised in terms
of keywords can be exchanged for
shorter and more informative titles
without being curtailed.
Example: Product Display Ad
21
sible to run an advertisement for
cat food in the entire “cats” or “pet
supplies” categories without having
to check and choose every single
ASIN manually. Unfortunately, this
option has not yet been enabled for
all categories and products.
A blessing and a curse
For brand manufacturers who con-
sider product and brand aware-
ness a top priority, Product Display
Ads can be a very powerful tool.
Owing to the extremely wide pur-
view and the relatively low cost
per click, a high number of custo-
mers within a certain target group
can be addressed almost immedi-
ately. In this way, it is possible to
generate a few million impressions
very quickly.
Seeing as the buyer decision
process is almost at its end when
Product Display Ads are shown,
it is necessary to think about the
actual benefit of advertising the
specific product at this point
as well as about the matching
(customised) ad copy. It is also im-
portant that there is a clear refe-
rence in the working of the ad to
the product whose detail page
is used to display the advertise-
ment. This can be accomplished,
for example, by indicating that
the promoted product is a co-
ordinated accessory to the pro-
duct featured on the detail page.
When it comes to ink cartridges
on the detail page of a matching
printer, the connection is fairly
self-evident, but this is not al-
ways the case. For interest-based
targeting, the wording of the
ad copy influences higher click-
through rates.
Similar to other AMS display
types, the permeability of the Prod-
uct Display Ads is simultaneously
a blessing and a curse. Using exam-
ples from product detail pages of
well-known brand manufacturers,
it becomes clear that the com-
petition is attacking established
category leaders and popular
brands. Often an ad for a company’s
direct competitor appears below
the Buy Box on their page. Rever-
sing this process is possible th-
rough clever cross-selling campa-
igns which increase sales through
Product Display campaigns and
keep the competition away from
one’s own product detail page.
Another option to turn the tables
is advertising the brand product,
including extended warranty
and other service advantages,
on the product detail pages of
no-name substitute products.
Product Display Ads provide a va-
riety of opportunities, but cut both
ways. On the one hand, they en-
able advertisements on the pro-
duct detail pages of the competi-
tion; on the other hand, adverti-
sements for complementary pro-
ducts influence customers to buy
more. Every company can become
a victim – or an offender (see Chap-
ter 3, Strategy, “Defensive mar-
keting vs. offensive marketing”).
Moreover, Product Display Ads
can throw the lever for cunning
campaigns based on the pro-
found knowledge of certain tar-
get groups. If you know that the
owners of products A and B have
looked at product C and are very
likely to purchase D, you can
achieve the respective target
group accuracy. If your compa-
ny purchases ARA Premium (the
advanced analytics solution from
Amazon), you will get a lot of use-
ful data to build your segments
and targetings.
No matter how one looks at it,
Amazon simply has the best re-
turn on investment ratio. No other
means of advertising offers the
cheapest CPC ratio and the hig-
hest amount of precision in the Ama-
zon portfolio as Amazon’s Product
Display Ads. Just keep in mind that
Best Practice
Please note that Amazon deactivates
campaigns with a click-through rate
below 1% since Amazon labels any
below this rate unprofitable. Thus,
the relevance of the promoted prod-
uct for a certain target group has to
be obvious.
22
the target group needs to be
well-defined for maximum effect
– interest-based targeting can
result in much bigger scattering
losses than product or keyword-
based targeting.
23
CHAPTER 3 HOW TO STRATEGICALLY UTILISE
AMS ADVERTISING CAMPAIGNS
How to win the game of Monopoly
Anyone who has never played
Monopoly – or is just no good at
it – spends way too much money
early on by buying every property
landed on and losing control over
the budget and figures per square.
When it finally becomes possible
to purchase Park Place, the coffers
are empty. The same is true of AMS:
campaigns lacking a clear objective
are not efficient and do not provide
reliable data, the basis on which
vigour could be increased. Cur-
rently, experimenting with AMS
on a small scale while yielding
competent results is quite easy
and affordable, but exploiting the
whole potential of a campaign and
display type is significantly more
speculative. One of the most dif-
ficult challenges for international
brands is scaling large assortments
and sales reasonably with the right
campaigns.
A holistic AMS strategy for the
entire range of goods is not neces-
sarily mandatory. Depending on the
lifecycle of a product and the com-
petitive context, the differentiation
of campaigns on the level of the
assortment may be recommended.
Apart from the superior account
strategy, there are a variety of pos-
sible campaign strategies with dif-
ferent objectives. Possible objec-
tives of campaigns for specific
product lines include increasing the
market share, brand awareness, as
well as sales or margin-directed
objectives. In the following, various
campaign strategies and their re-
spective tools will be explained in
detail.
Campaign Strategies
by Comparison
Within daily business on Amazon,
event driven sales campaigns are
consistently foregrounded, which
makes corporations lose perspec-
tive. The superior objective of com-
panies selling on Amazon should al-
ways be to become as independent
as possible from the retail giant’s
search algorithm A9 as well as from
the competition to attain the best
possible ratio between marketing
costs and sales. The following chart
shows how diverse the approach-
es can be, depending on the cam-
paign objectives. For reasons of clar-
ification, the key features of most
campaign strategies are included.
Depending on the initial situation,
the budgeting and past results,
a slightly adjusted setup can be
more expedient. Thus, the setups
displayed in this white paper are
meant to be templates which can
be adjusted and built upon on a
case-by-case basis.
Increase in Sales
The classic objective of advertising
campaigns is increasing sales to ma-
ximise turnover. When having this
objective, concentration must be fo-
cused on the sales growth rate of the
promoted products. The respective
costs are limited by a fixed budget
or a maximum ACoS. Meanwhile,
focus lies on the keywords with
the greatest range, which should
have bids above the current market
standard. Apart from the manually
controlled Sponsored Product and
Headline Search Ad campaigns, the
automatic campaigns adjusted by
the Amazon algorithm should be
switched on. Amazon then covers
the longtail keywords to ensure the
largest possible range. This range,
in addition to the ROI, is continual-
ly optimised like within any other
campaign. The exact strategy for
this kind of optimisation is going to
24
be explained in detail in Chapter 4.
ROI driven campaigns also increase
sales, but here the focus lies on
doing so while spending as little
money as possible, thus achieving
a minimum ACoS. In practice, this
means gradually creating the ideal
ratio between range and sales from
experience with past campaigns or
with start bids below the market
standard. By optimising individual
bids and detailed keywords sets,
Campaign Objective
Keywords Bidding StrategyKey Performance Indicators (KPIs)
Display Types
Increase in Sales Generic + Automatic Aggressive Growth Rate SP, HSA
Return-Optimised Sales
Longtail Low and IncreasingReturn on Investment
(ROI)SP
Trademark Protection
Brand + Product Lines
Aggressive Auctions Won HSA, SP, PDA
Increase in Market Share
Competitors Aggressive Auctions Won HSA, PDA, SP
Cross-Selling/Up-Selling
Brand + Product Lines
Market LevelShopping Cart Size
+ ROIPDA, SP
Product Launch Generic + Automatic AggressiveRanking
ImprovementSP, HSA
Utilising Event Driven Effects
Combination of Event Keywords +
GenericMarket Level Increase in Sales HSA, PDA
Increasing Brand Awareness
Generic + Competitors
Low and Increasing Impressions + Clicks PDA, HSA
ClearingGeneric +
CompetitorsLow
Return on Investment (ROI)
SP
Keyword Research Automatic LowNumber of New
KeywordsSP
Comparative depiction of AMS campaign strategies (HSA: Headline Search Ad; SP: Sponsored Products; PDA: Product Display Ad) Source: Own illustration
25
the ROI continually improves and
sales increase with a steady bud-
get. The binary contrast between
the main focus of those two cam-
paign objectives shows why there
is no middle ground: Individual
products, assortments or brands
are adjusted to increase brand awa-
reness, ranking and ultimately sales
by intense and aggressive bidding.
The effect of every single dollar is
considered. In daily business with
AMS, these two campaign setups
occur in succession, which is an
extremely effective strategy for
new campaigns without previous
experience or product launches.
In this manner, you can improve
your products organic ranking in the
short run and then in the next step
support its steady advancement
sustainably.
Trademark Protection and
Increase in Market Share
Comprehensive knowledge about
the keywords relevant to your own
product is essential. You should
regularly check to what extent your
keywords are also being occupied
by your competitors. If your objec-
tive is protecting your own brand
against attacks from the competi-
tion, you have to utilise all display
types. Many people believe that
booking Headline Search Ads
for their own trademark name and
products is suf f icient to defend
themselves, but Sponsored Pro-
duct and Product Display Ads are
also indispensable tools for trade-
mark protection. For example, even
if Adidas manages to lead custo-
mers to the product detail page of
a specific pair of black sneakers by
means of Headline Search Ads and
Sponsored Products, competitors
still have the chance to advertise
another pair of black sneakers on
their product detail page near the
Buy Box, at the exact point when
customers are closest to putting
something in their shopping cart.
This aggres- sive approach yields
three main results: firstly, there is
the risk that Nike or any other com-
petitor might steal customers and
sales away from Adidas; second-
ly, Adidas invested resources that
no longer have an effect – apart
from helping the competition; and
lastly, the competitor’s product
has a better ranking since it was
purchased more often.
The Winner takes it all.
To keep using the example of Adi-
das sneakers, what can Adidas do
exactly to prevent these interven-
tions from happening? The defen-
sive approach, in this case, could
not be any easier: the respective
product detail pages should be oc-
cupied by Product Display Ads for
their own products. A customer who
gets to the detail page of those
black sneakers, but is still not en-
tirely convinced and is drawn to
an advertisement beneath the Buy
Box can instead be led to another
Adidas product – maybe a white
version of the same pair of sneakers.
Thus, the customer is shepherded
through Adidas’ product universe
until the perfect match is found.
Another option is the aggressive
approach, which can also intervene
much earlier in the buyer decision
process. Most notably, successful
brand manufacturers who have suc-
ceeded in occupying a whole prod-
uct category with their trademark
are endangered in the conversion
funnel. “BRITA” has become a syn-
onym for the term “water filter” and
is often typed in the search bar in its
place. If no-name brands, like BWT,
manage to occupy the keyword
“BRITA” with a Headline Search Ad
campaign, they can make customers
aware of the price disparity and put
themselves in an ideal position.
The same approach can be used
for Sponsored Products to address
customers searching for “BRITA”
with the respective no-name prod-
ucts. If those are cheaper and get
good reviews, they will appear quite
attractive to potential customers.
An added bonus is that they will
likely be perceived as “best search
results” by quite a few customers,
as described in Chapter 2.
Therefore, it is even crucial for
established brands and manufac-
turers occupy their own brand’s
keywords prophylactically. Defen-
26
sive campaigns should always be
prioritised to prevent giving away
advertising budgets on Amazon
to the competition. It is all about
consolidating the market position.
You can imagine the ideal setup as
a completely bought up colour
group on a Monopoly board – do
not give the opponent any chances
to gain a foothold and the game
has figuratively already been won.
Moreover, the individual squares
back each other. You can immedi-
ately charge double the rent when
an opponent comes across one of
your coordinated streets, and start
building houses and hotels. Trans-
lated into AMS language: if Adi-
das occupies many of the relevant
keywords for their own products
with display ads, they can protect
themselves against Nike, New Bal-
ance, etc., while also efficiently
cross-selling and up-selling. Why
not advertise the matching socks
with Product Display Ads on the
product detail pages? BRITA, on the
other hand, should use Headline
Search and Sponsored Product Ads
to consolidate their market posi-
tion within the search results on
Amazon.
Utilising Event Driven Effects
Like any other commercial enter-
prise, seasonal offers affect Amazon
as well, the consequence being that
the bidding war for the best adver-
tising spaces is most intense when
there is a seasonal event during
Christmas or Easter. Accordingly,
the cost per click is extremely high.
Normally, the higher bids corre-
spond with increased consumer
acceptance, but steeper demand
has to be kept in mind during the
planning of the annual budget.
The same applies to events created
by Amazon, like the Cyber Weeks,
Prime Day or Amazon Easter Week.
On those days, the number of visi-
tors on Amazon increases exponen-
tially. By means of an increased daily
budget, an infinitely greater number
of people can be addressed than
usual. But it should be kept in mind
that thousands of discounted pro-
ducts are used as crowd pullers
for those events. Thus, not only
the overall product environment
changes, but also the purchasing
behaviour of potential customers.
Perhaps products with the vigour to
generate sales all year long should
receive more advertising attention
during the offseasons to avoid the
pre-Christmas spike in ad prices.
This is definitely healthier for the
ACoS.
To clearly demonstrate how sea-
sonal offers and the positioning of
display ads impact the success or
failure of a campaign, typical Ger-
man “lederhosen” is the perfect ex-
ample. Those who advertise cheap
lederhosen in January on the pro-
duct detail pages of a shop called
“Buckskin Breeches” in the price ca-
tegory of 1,000€ or more, will have
thrown money out the window.
Similar to the keyword research for
manually adjusted campaigns de-
scribed above, realistic assessments
and common sense are key when
it comes to selecting the targeted
ASINs. Less expensive lederhosen
are predominantly bought in Sep-
tember right in front of the entrance
to Oktoberfest in Munich. Whoever
really wants premium leather shorts
in the beginning of the year from
the top price category is probab-
ly looking for high-quality leather
and is willing to pay top dollar for it.
Cheap advertising spaces are not a
tool for bending the laws of time,
space and fashion preferences. The
ACoS of the little sales generated
through this kind of strategy would
be way too high and the campaign
would hardly be a profitable inves-
tment. A much more efficient use
of time is utilizing Product Display
Ads on the product detail pages
of equivalent lederhosen to ad-
vertise them in mid-August. With
the addition of an accordingly
adjusted product title like “Per-
fect Octoberfest-Lederhosen,”
the product would be a hit.
Increasing Brand Awareness
Amazon is one the biggest display
marketers in the world and reaches
millions of users every day. The high
market penetration in the segment
of online shopping means that
27
AMS is also suitable for branding.
Although the basic objective of
every AMS campaign is to increa-
se sales, campaigns geared to a
target group can also be used to
incorporate the brand into a set
of potential customers. Regarding
the thousands of targeting opti-
ons for Product Display Ads, the
cost per click only varies by a few
cent values. In this space, millions
of users can be addressed within
a very brief time span, despite an
interest-based targeting scheme.
It must be noted that the more ex-
pensive positioning in the search
process with Headline Search Ad
campaigns can yield very good re-
sults when introducing a new brand
or product line. The ad‘s very positi-
on between the search bar and the
search results amplifies the brand
as well as the ad copy, which are
inevitably noticed by potential
customers. Thus, AMS can also be
an interesting approach for sup-
pliers of fast-moving consumer
goods with strong of fline sales
channels. However, those with
larger branding plans are recom-
mended to use the Amazon Ad-
vertising Platform (AAP) because
it offers more diverse advertising
options inside and outside the
Amazon shopping environment.
Clearing
A special but frequently occurring
campaign objective is the clearing
of in-stock products. These are
mostly outdated products for which
an updated version is available. In
these cases, the margin is quite low
for Amazon as well as for manufac-
turers because the market price has
probably significantly decreased.
That is why Amazon might not al-
low a promotion without Amazon‘s
purchase price being discounted
further. It is very important to know
up front if the listing is going to be
annulled or taken over by the mar-
ketplace sellers, or if the updated
version will substitute the old one
on that listing altogether. In the
former case, the focus is placed
on increasing sales to reduce
warehousing and depreciation
costs. In the case of the latter – when
the old listing continues with the
new version of a product – the cam-
paign becomes an investment for
future ranking and helps the launch
of the updated product. Thus, the
costs for clearing in-stock products
can be considered indirect marke-
ting costs for the new ones.
Keyword Sets and
Algorithm Effects
For a campaign which is focussed
on increasing market share, the first
step is the selection of relevant key-
words regarding the brand or a
product. Those keywords, as well
as their reasonable variations, are
booked manually, therefore having
knowledge about the market and
the products is key. Using infor-
mation about a product’s own ran-
king in connection with different
keywords sheds light on which
keywords are relevant. Creating a
suitable keyword set is laborious
and requires the support of spe-
cialised tools which help discover
the most popular search terms. Last
but not least, keywords from older
campaigns of similar products can
also be included.
Another way to reduce adverti-
sing costs is not to focus on specific
keywords at the start of the cam-
paign, but rather to take a broa-
der approach. For this campaign
objective, automatic campaigns
should be set up, which the Ama-
zon algorithm autonomously enri-
ches with relevant keywords. It is
important to advertise only a few
products with similar features in
these types of campaigns so that
a clear picture can be made of
which keywords work best for the
various products.
When advertising several prod-
ucts with the same keyword, auto-
matic campaigns do not provide
data based on SKUs – stock keeping
units. Moreover, one should start
with low bids in cent amounts be-
fore slowly increasing them. The
objective here is to let the Amazon
algorithm work its magic, which is
why it is not beneficial to start with
high bids. When this occurs, the
algorithm spends the daily budget
28
on the all too apparent and over-
priced keywords (see Chapter 4,
paragraph 2: Keyword Optimisati-
on). It is self-evident that cheaper
keywords are not the big sales dri-
vers, but one can identify the hid-
den champions – those keywords
which cater to exceptional sales
figures in minor investments and
simultaneously provide useful in-
sights regarding the best perform-
ing keywords – for manually booked
campaigns of similar products.
Knowledge of the search terms
is crucial for successfully using AMS
because the bidding war for the
most relevant keywords gets high-
ly competitive very quickly. The ad-
vertiser who knows the keyword
landscape can occupy large ter-
ritories secluded from the great
battle before it even starts. The shoe
segment provides another good
example: “running shoes” is a
keyword which attracts a lot of in-
terest as well as money from strong
brands such as Adidas and Asics.
This method is affordable for these
two brands, but not for the little
guy. Therefore, it is more efficient
for smaller companies to look out
for more specific keywords, such
as “marathon running shoes”, “trail
running shoes” or “Tough Mudder
running shoes”. These keywords all
correspond to different variations
of running which may be relevant
to the advertised product. These
longtail keywords often are the
only viable way for smaller brands
that cannot afford the main key-
words.
What does the opponent do?
Competition Analysis
If the campaign objective is an at-
tack on the competition, the first
step is to get as much information
as possible about them. To just
randomly bid on competitor‘s key-
words is counterproductive from
the viewpoint of the ACoS. You
can more effectively use your time
finding exactly which keywords can
be occupied with minimum effort
and maximum effect. The same
applies to ASINs: the competi-
tor’s ASINs, for which a suitable
replacement exists in your own
catalogue, should be identified as
well as the pages on which Product
Display Ads will be most effecti-
ve. Projected onto the Monopoly
board, the question becomes:
which street should I purchase to
deny the opponent the occupation
of a complete group of streets?
The analysis starts with tradi-
tional keyword research: which
of my competitor’s keywords are
ranked exceptionally well? Here
your own ranking and that of your
competitors should be compared.
Next, you should select keywords
for your campaign. It is of the utmost
importance to categorise keywords
into price ranges in order to decide
on which of the words will absorb
the largest part of the budget. After
that, the variations of and additions
to these keywords can be identified
in a process of elimination, which
can be prioritised as cheap alter-
natives to the main sales drivers. In
the end, you have a set of keywords
worth fighting for. You should in-
vest in these keywords aggressive-
ly since they are mostly popular
sales drivers. They can only be oc-
cupied by aggressive bidding –
provided that the previous analysis
was thorough.
Regarding this campaign objec-
tive, one question always remains:
how promising is such an approach?
Well, unfortunately, you cannot
evaluate the ratio between reve-
nues and expenses until the respec-
tive campaign has ended. However,
numerous indicators can be col-
lected and evaluated beforehand.
For example, the sales rank of the
competitors who occupy the same
keywords sheds light on what to
expect for one’s own campaign. A
more refined method is to set up
Product Display Ads on the product
detail page of the respective com-
petitor’s product: the number of
impressions gives a relatively clear
picture on how many potential cus-
tomers visit the product detail pages
of the higher-ranked competitor
in the organic search results. Lim-
ited in duration, such a push on the
competitor’s product detail pages
is certainly affordable and provi-
29
des a reliable impression of the ex-
pected magnitude. This information
is especially important to know in
advance, since a campaign which
is more successful than previously
expected quickly results in supply
shortages, which in turn can have
a negative impact on the ranking
within the organic search results.
Thus, an elaborate plan is needed
so that your competitor does not
profit from your mistakes when you
are trying to overtake their market
shares. In this fashion, one should
also consult external fee-based
tools to assess the potential sales
figures in case of doubt. Unfortu-
nately, the cost structure of campai-
gns with several targeted ASINs
cannot be itemised subsequently.
Thus, a clear groundwork and a de-
tailed itemisation are necessary.
- € 0 %
20,000 €4 %
2 %
6 %40,000 €
8 %
10 %60,000 €
12 %
14 %
80,000 €
100,000 €
120,000 €
Launch of a Product Line with AMS support
16 %
18 %
Jan Feb March April May June
Organic Turnover Turnover via AMS ACoS
The effect of a professional AMS campaign: an increase in sales (AMS and organic), ACoS optimisation. Source: Own illustration
30
TWO SUCCESS STORIES: BEST SELLER RANKINGS BY MEANS
OF TARGETED AMS SUPPORT
In the previous chater, we showed
why increasing your market share
is an extremely important campa-
ign objective when launching a
new product. Here we will pre-
sent two case studies. The first
is about the launch of a product
line, supported by Amazon Mar-
keting Service, in the highly com-
petitive “home & kitchen” category.
The campaign objective was to
establish oneself with the new
assortment in the best seller lists.
The second case study is about
how an already available IoT pro-
duct was made a best seller over
a longer period.
Case Study #1:
From 0 to 1: Product Launch
with AMS Support
The objective of the client was a
quick increase in sales with a new
factor - a contributed to these suc-
cess stories. Feel free to schedule
a consultation for more details on
how we can improve your compa-
ny’s success on Amazon via AMS.
product line of ten products wi-
thin a highly competitive market
niche. The elaborately optimised
and interconnected product de-
tail pages, which had already
been edited by our content spe-
cialists, served as the basis for the
campaign. Within the context of
the tool-based keyword research,
a specific keyword set with max-
imum range and relevance was
created for each of the ten prod-
ucts. Regarding the optimisation
of the conversion, a collection of
crucial reasons to buy the pro-
31
ducts was created for the client
by means of a content relevance
analysis. The titles, bullet points
as well as all other textual ele-
ments were finetuned to suit the
relevant search terms and equi-
valent products were grouped
together as the main product
and variants. factor - a emphasises
the importance of this preceding
step of content optimisation and
SEO because it is simply not
possible to conduct a successful
AMS campaign without laying the
groundwork first.
To increase the visibility of the
products from the start, numerous
AMS campaigns were set up. In
every stage of the buyer decision
process, the customer was made
aware of the assortment with
Headline Search Ads, Sponsored
Products and Product Display
Ads. Only two months after the
start of the campaign, two of the
new products were best sellers in
their relevant product categories.
Although the ratio between orga-
nic and Amazon Market Service
turnover was a bit inauspicious
in the beginning, the ACoS of
18% was still pretty good – and
in March it was tuned down to
12%. That is especially astonishing
considering that March was the
month with the highest propor-
tion of non-organic sales. These
results were possible due to con-
tinuous optimisation and thus the
reduction of unprofitable key-
words and display ads as well as
the expansion of high-performan-
ce keyword sets and display ads.
The increasing sales rank, reliable
delivery and positive customer
reviews also helped improve the
ranking in the organic search re-
sults, which in turn led to an in-
crease in sales. By following this
recipe for success, an ACoS of 8%
was reached within five months
by factor - a.
Even more impressive was the
jump in sales. The monthly turn-
over of the advertised assortment
increased from under 10,000€
to 110,000€. In June, already
80,000€ of the total turn-over had
been generated via the organic
demand. This specific AMS cam-
paign must be understood as part
of an upward spiral. In the begin-
ning, it helped draw attention to
new products which would have
otherwise been under the threat
of being lost in the masses of prod-
ucts on Amazon. Afterwards, the
campaign attained continuous im-
provements in sales – mostly via
highly efficient PDAs that aimed at
cross-selling and up-selling.
The other figures in this cam-
paign also speak for themselves.
Broken down to the single dis-
play types, one can see that even
Headline Search Ads, designed
for the general awareness of the
new assortment, catered to a turn-
over of 25,400€ with costs of only
3,600€. Thus, the ACoS of about
15% was, by all means, acceptable.
Within five months, the total invest-
ment of 13,660€ generated an
AMS turnover of 132,800€. Thus,
the average ACoS of 10.28% was
extremely low. Moreover, it must
be kept in mind that this specific
product niche was highly com-
petitive. Provided that other seg-
ments are not as competitive, the
costs would have been even less
in the respective categories. The
total organic turnover, which was
much higher than the pure AMS
turnover, could not have been
developed without this kind of
Nils Zündorf Head of Paid Advertising
Speak with the authorSchedule a free phone consultation today!
+ 49 221 177 337 10
info@factor - a.com
campaign. Now, clients want to
preserve this solid basis and fur-
ther reduce the ACoS. Of course,
they do not want to lose their
strong position within the organic
search results. This was achieved
by continuously advancing the
keyword sets, integrating new key-
words in the content as well as
timely occupying these keywords
with appropriate AMS display
ads.
Case Study #2:
From Zero to Hero
Our client’s product previously
underperformed in terms of sales
and turnover in comparison to
competitors and the rest of the
portfolio. The turnover stagnated
between 20,000€ to 30,000€
a month and it was clear that the
product would not emerge from
years of stagnation on its own.
The product was complex, requi-
red an explanation and was desi-
gned to be combined with other
products from the client’s assort-
ment, which led to customers
often misapplying or improperly
combining it with other products.
This led to customers giving cri-
tical reviews, which did not help
the cause. As in the first case stu-
dy, AMS setup took place after
the content optimisation. First,
we had to define twisters for the
assortment, so that all related pro-
ducts could be displayed on one
- €
20.000 €
40.000 €
60.000 €
80.000 €
100.000 €
120.000 €
Sep Oct Nov Dec Jan Feb March April May
Increasing Sales by Means of A+ Content and AMS
These two striking charts hint at what is possible with AMS and come from the case studies in Chapter 4. Source: Own illustration
Revision of Product Detail Pages with A+
Content
Start of AMS Campaigns
Optimisation of AMS
Campaigns
32
20,000 €
40,000 €
60,000 €
80,000 €
100,000 €
120,000 €
33
product detail page along with the
main product. This step is about
the pooling of the main product
and its variants. Another neces-
sary requirement was the creation
of A+ content to provide the po-
tential customer with a detailed
description of the product. After
these steps had been completed,
factor - a set up the AMS campa-
igns with the objective of cost-
effectively increasing sales on a
long - term basis.
The revision of the product
detail page in October alone ca-
tered to a significant increase in
sales: the sales in November had
already doubled since September.
After this first boost, the growth
rate slowed down and ended up
stagnating again. As it turned out,
the competition started fighting
for this market standing with a
massive advertising campaign and
attractive markdowns. After the
sales figures decreased between
January and February, targeted
AMS campaigns were set up in
March. In the meantime, the client
had launched two new accessory
items, one of which was also com-
patible with the competitor’s pro-
duct. Those lent themselves nicely
as bait with which customers could
be drawn back to the original pro-
duct. By means of the Product Dis-
play Ads and Sponsored Product
Ads for the accessory items on the
product detail pages of the compe-
titor’s products, factor - a was able
to drive the traffic by implementing
informative and attractively desi-
gned landing pages. These pages
presented the client’s assortment
which had been arranged around
the problematic main product. The
result: a considerable number of
conversions.
By May, the turnover created
with the main product had increa-
sed from a stagnating 50,000€ to
70,000€. Only one month later,
the client generated a six-figure
turnover with the product on
Amazon for the first time. The next
step for factor - a was to start the
optimisation of the campaign, dri-
ven by the return on investment.
This example shows clearly
how important an accurately de-
fined strategy actually is. It would
not have been reasonable to ad-
vertise the product with many
critical reviews and low sales fig-
ures via Product Display Ads as
the substitute for a bestseller. The
strategy was based on the optimi-
sation of the respective product
detail page(s) before attention was
drawn to the client’s assortment
by means of relevant accessory
items. Customers on Amazon have
a reasonable interest in accessories
when making their final purchase
decision and often perceive Pro-
duct Display Ads as a welcome
source for additional information
rather than as a disturbing display
ad. Thereby, the customer directly
encounters the broad assortment
available on Amazon and can be
reminded that Amazon provides
all one needs. Optimised and in-
terconnected product detail pa-
ges and brand pages help build
trust and eclipse potential com-
petitors.
Nils Zündorf Head of Paid Advertising
Speak with the authorSchedule a free phone consultation today!
+ 49 221 177 337 10
info@factor - a.com
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• Keyword Research and Content Relevance Analysis
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36
CHAPTER 4 TACTICAL TRICKS WITH AMS PRODUCTS
From square to square around the Monopoly board
In the previous chapter, we out-
lined several strategic approaches,
in which we showed how AMS can
be utilised to increase the market
share on Amazon, as well as the
return on investment, on a long-
term basis.
Now, with the turn of the page,
we will change to the tactical level
of campaigns, since even the best
strategies cannot take full effect
when the tactical implementation
is flawed. This chapter is about how
to set up campaigns, define key-
words, evaluate the results and
simultaneously maximise the ef-
fectiveness of the campaigns. It is
about having a cohesive strategy
and daily optimisation routines. In
the end, it is the minor details that
account for the competitive advan-
tage. To use the Monopoly analogy,
a player can occupy whole colour
groups and successfully build on
them afterwards when the game is
played systematically step by step.
Step 1: Structuring Campaigns
Generally, Amazon Marketing
Services display types consist of
the following elements: campaign
settings, products (ASINs) and a
key word set with appropriate
keywords.
Campaign:
On the top level, the maximum
daily budgets, as well as the total
campaign budget, are defined.
Here one can also decide if the
campaign shall run automatically
or manually. As we explained in
the previous chapter, you should
always have automatic campaigns
in addition to the manual ones for
the purpose of keyword research.
Furthermore, it is necessary from
time to time to set up temporary
The Creation and Optimisation of Campaigns
Structuring the product
portfolio according to campaigns
Defining the campaign objective
Keyword Research
Defining initial
keywords and bids
Scaling and Evaluating the Success
Adjusting keywords and bids
Adding keywords
drawn from automatic
campaignsThe process of creating and optimising AMS campaigns. Source: Own illustration
37
and specifically adjusted manual
campaigns (regarding the season-
ality of e-commerce, see paragraph
“Analysing and Continuously Opti-
mising”). And of course, the cam-
paigns and respective products
must be structured in a way that
the keywords match every single
product within a campaign.
Products and Keywords:
On this level, individual products
and keyword sets are defined. Ama-
zon automatically generates ads
for every product – Headline Se-
arch Ads and Product Display Ads
provide the additional opportunity
to adjust the ad copy. To achie-
ve the best possible impact or to
draw the attention of customers
to a specific product feature, this
feature should be used. For ma-
nually adjusted campaigns, the key-
words relevant to the respecti-
ve advertisement also need to be
defined. This step can be skipped
for automatic campaigns. While
there is no such thing as the per-
fect campaign setup or just one
typical seller or manufacturer on
Amazon, some campaigns are just
better than others: the structure
and organisation of efficient cam-
paigns are characterised by speci-
fic similar features.
Campaigns:
The Category Says It All
The division of a campaign into
parts allows for creating different
aggregations. Manufacturers and
brands can subdivide their assort-
ments in multiple campaigns of pro-
duct categories, product lines or, in
the best case, similar features. Let’s
look at another example: Lego can
divide their assortment into the
different product worlds: Castles,
Pirates and City. When doing so, it
is important to broaden the cate-
gory names past the main options
and go further into the appropriate
categories for the product lines
themselves. Grouping products
together which are searched for by
potential customers with the same
interests is of the utmost import-
ance. We recommend that you con-
sistently stick to one system while
structuring campaigns to avoid an
excessive assorted classification
of products in campaigns with the
same objective, which can worsen
scalability and cause one to quickly
lose track. Generally, a classification
across categories is not a problem
and may even be intended when
setting up campaigns for seasonal
events or when they accompany
offline campaigns. This practice
remains, however, the exception.
Another crucial factor to consider
is the naming of campaigns. You
should avoid using labels like “Cam-
paign 1” because they will cause
you confusion and lead to Amazon
users losing track of their accounts –
especially when it comes to analysis
and optimisation. It is better to use
expressive names, such as “Wireless
Speaker | Defensive”, “Wireless Spea-
ker | Offensive” or “Monitors | Com-
p e t i t i o n | AS I N s | B e s t s e l l e r |
Quality Ad Copy” and “Monitors |
Automatic Targeting.” The alloca-
tion of distinct IDs and a consistent
naming scheme across all campa-
ign types will make following your
campaigns much easier.
Product Grouping: Birds of
a Feather Flock Together
On the campaign level, each set
of products is connected to a
keyword set. Thus, it is important
that all products within a group
fit all keywords in the respective
set. Depending on the customers’
search behaviour, it is not shrewd
to group the products according to
product lines. Instead, we recom-
mend you assign, for instance, all
non-stick pans to one campaign
and then all stainless-steel pans to
Attention!
Products which are not profitable
for Amazon cannot be advertised.
Since this of ten also af fects best-
seller products, it is fruitful to check
beforehand which products can
be advertised and contact the re-
spective Vendor Manager in case
of doubt. Plus Products, as well as
Pantry Products, are also barred
from being advertised.
38
another. The grouping method for
larger assortments should be as
precise as possible to avoid cases
in which shoppers are looking for
“non-stick pans” but are presented
with the associated pots and casse-
roles instead. Consistency is once
again key regarding scalability and
evaluation of success, especially
when it comes to larger assortments
with complicated interconnections.
Step 2: Defining and
Optimising Keywords
The fact that the selection of key-
words, tailored to a specific prod-
uct, is the decisive factor for the
success of every campaign is obvi-
ous. If customers who are looking
for “men’s jeans” are presented with
„lady‘s pants“, they are not likely
to change their minds and buy the
other product instead. This is where
an advertiser can lose money. If
customers click on the respective ad
before noticing their mistake, the
advertiser still has to pay. When im-
portant keywords are missing from
a set, sales revenues are lost. For
example, if the term “men’s jeans”
is not included in the keyword set
for a Levi’s 501 campaign, quite a
few potential customers will not be
made aware of the product.
At this point, advertisers must
ask themselves the same questions
as in any other search engine mar-
keting environment:
1. How do I find the most relevant
keywords without excessive bur-
den?
2. How do I ensure that my ad-
vertisements are displayed in
accordance to matching search
requests?
3. How do I avoid my advertise-
ments being displayed with odd
search requests?
Apart from having sufficient know-
ledge about the assortments and
products, with the help of common
sense, there are a few tactical tricks
that can provide keywords that may
not be evident candidates from the
start – because the customer moves
in mysterious ways.
Specialised tools create key-
word sets and stagger these
keywords according to search volu-
me and relevance for the respective
products, but the supplier market
is still very fast-paced. The ideal
way is using Amazon itself because
its A9 algorithm knows best what
is happening in the market cos-
mos. Set up at least one manual
and one automatic campaign – si-
milarly structured – for the same
group of products and evaluate the
results after a few days or weeks.
After that, include the keywords in
the manual campaigns catered to a
high sales rate or an advantageous
cost-turnover ratio in the automatic
versions. We assure you, surprises
are usually in store!
Another very important step is
defining, preferably keen, maximum
bids for the automatic and manual
campaigns. If both campaigns bid
the same amount of money on the
same keywords, quite a few clicks
are going to be made with the au-
tomatic campaign, which otherwise
would have been generated by the
manual campaign as well. When the
budget in the automatic campaign
is curtailed, the algorithm will over-
bid on the most relevant keywords
and will be forced to broaden its
spectrum.
If some of the keywords inclu-
ded in the manual campaigns did
not generate impressions, i.e. were
not displayed at all, start the error
search. Here the relevance of the
display ads is extremely important
since Amazon makes more money
off selling the product than off ad-
vertising it. Amazon ensures the
relevance by featuring manually
adjusted display ad campaigns only
when the selected keyword is rel-
evant to the respective product.
The absence of impressions is con-
sequently a crucial indicator when
analysing the product descriptions
and harmonising them with the cam-
paigns. If conspicuous search terms
are not included, the content must
be revised. This also improves the
39
organic ranking of the products
independent of AMS. As we have
mentioned several times already,
optimised content is the foundati-
on of a successful AMS campaign.
If individual ASINs of Sponsored
Products campaigns do not gener-
ate impressions, the reason might
be that the advertiser has lost the
Buy Box for the moment. In these
cases, Amazon has deactivated the
advertisement in order to prohibit
an increase in revenue from another
seller. Attention: the same cannot
be argued for Headline Search Ads
and Product Display Ads.
Step 3: Bid Adjustment
When the keywords match the
search requests (or when the target
group or ASIN matches a Product
Display Ad), the bid on a potential
click is the defining factor on when
and how often an advertisement
is displayed. Furthermore, the bid
amount is crucial for the ACoS. Thus,
apart from the right keywords, the
bid amount is the most valuable
tool for success with Amazon
Marketing Services. The perfect
amount for a CPC bid is conten-
tious. On the one hand, a high bid
caters to an ads frequent display
and increased sales, as long as the
ad is coherent; on the other hand, it
occasions higher costs per sale. Ano-
ther factor is the campaign objec-
tive. For example, if an automatic
campaign is used to find new key-
words, sales become quite irrele-
vant and the cost per click (CPC)
should be as low as possible for
tactical reasons. Nevertheless, the
CPC should be adjusted upwards if
the product-keyword combination
is a known sales driver. Another
thing to keep in mind is the life cy-
cle of the product. If the objective
is a short-term push or temporary
product launch, the campaign will
not have enough impact without
high bid amounts. If the objective,
however, is securing an establis-
hed market position on a long-term
basis, the optimisation of the ACoS
has absolute priority.
To not get worn down by these
two extremes, clear and purposeful
goals for the marketing expenses
should be defined, based on strate-
gic decisions (see Chapter 3). Al-
though marketing expenses mostly
comply with the margin of the seller
or manufacturer, they still can vary
depending on the campaign objec-
tive. For short-term campaigns, the
cap is open: to increase brand awa-
reness, some companies are willing
to invest almost all sales revenue
back in marketing. It is questionable
if this is actually necessary when the
campaigns are well-planned and
implemented accordingly.
A few things to keep in mind:
• For the most part, new keywords
must be tested with market-con-
form cost per click bids so that the
respective display ads are clicked
on often enough to produce va-
luable data in a brief time. Key-
words with a high search volume
and an ever-changing competi-
tor can yield satisfactory results
on in the long term with a CPC
bid below the market standard,
but the respective display ad is
not going to be displayed at the
best possible position on the first
search results page.
• If the cost per sale is too high,
the CPC bid should be reduced
by a certain extent to assess to
which extent the ratio can be im-
proved. Deactivating keywords
should only be the last resort.
• If sales are too low, the CPC bid
should in turn be increased by
degrees to assess if the range
of the advertisement can be
improved without generating
Best Practice
Product Display Ads are not only
booked for keywords, but also for
ASINs and specific target groups.
If these advertisements generate
little or no impressions, the error
search should be started: does the
defined target group even exist? Is
there a relation to the chosen ASIN
(and is the product still available
for that ASIN)?
40
too many costs.
• If the average costs per click is
near the maximum bid, this is a
clear sign that the sales potential
is not being used completely.
All the same, depending on the
type of adjustment and the revenue
dimensions, it can take a few days
or even weeks for reliable results to
be provided. Keywords with a high
search volume but a poor ACoS
even after one or two months of
continuous optimisation should be
deleted from the respective cam-
paigns or be further constrained by
means of negative keywords. Espe-
cially larger assortments should be
managed with specialised tools or
by a professional marketplace ma-
nagement agency since reporting
exports mostly just provide raw data
which must be further rehashed.
Step 4: Analysis and
Continuous Optimisation
Numbers, figures and their analy-
ses are a superordinate issue with
Amazon. Although this white paper
is not the place to go into the report-
ings and evaluation of various data
sets in detail, we nonetheless want
to stress that the Amazon Marketing
Services campaign data should not
be read in a vacuum – thus, it can not
be interpreted correctly without re-
ference to other data sets. Your com-
petitor’s activity, process issues
within your own company, as well
as inexplicable upward and down-
ward sales outliers all affect the
pure AMS key figures.
Thus, regular Amazon data ana-
lysis routines are extremely im-
portant, and the best performing
products should be subject to daily
evaluation. Thereby, you can quickly
react to certain dangers such as
sudden price collapses or supply
shortages. Especially brands should
check their assortment regularly
because Amazon maybe has blun-
dered important content on the
product detail page, or another sel-
ler of the same products has latched
onto your brand product’s content.
Other problems might be that there
was a significant price reduction
on Amazon, or another seller has
dropped their price so drastically
that all the prices for that product
have decreased automatically.
From the perspective of AMS,
it is also necessary to regularly au-
dit the most relevant keywords on
the most important product detail
pages as well as on the search re-
sults pages. Are the ads as arranged
displaying your products or those
of your competitors? Apart from
checking figures, we also recom-
mend viewing your own product
detail pages as a mystery shopper.
Although Amazon’s statistics
and your own tool-based evalua-
tions have to be taken seriously,
they should also be understood
with a grain of salt. If figures vary
tremendously, you should definitely
find out why. Do the jumps in sales
comply with the actual deliveries
and revenues? Keep in mind that
Amazon is not really interested in
providing all the data – especially
since the corporation plays a double
role as marketplace and provider of
the respective advertising surface.
Thus, it is regarded as imperative
to regularly check the detailed
reportings by means of cross-com-
parison:
• Data must be exported regu-
larly from Amazon – either with
the help of tools or your own
spreadsheets and databases
because the information is not
stored infinitely and can only be
exported manually.
• Campaigns should be set up dis-
tinctly from one another because
important indicators are shown
in the data provided by Amazon
only for each campaign.
• Central indicators like the Aver-
age Costs per Sale (AcoS) calcu-
lated by Amazon cannot always
be trusted because they include
brand sales revenues from the
last 14 days. Only through a
cross-comparison to the actual
sales volume will the ACoS be
represented accurately. At this
41
point, you must keep in mind that
the ACoS is based on the net
price for the consumer, not on
the net price Amazon pays the
manufacturer for its products.
At worst, allegedly successful cam-
paigns run for months before their
grievances become apparent. This
is what happens when the data is
not checked regularly. We can
demonstrate the dangers of this
practice with an example from a
hastily conducted campaign ana-
lysis. The company based its cam-
paign solely on AMS figures provid-
ed by Amazon. Take a manufactu-
rer’s Headline Search Ad campaign
that leads customers to the prod-
uct detail page of a strong-selling
premium product. AMS instantly
manifests a very good ACoS and
everybody is happy. However, at
this point, it was not at all apparent
where the sales were generated
from since Amazon included all the
sales of the brand’s product from
the last 14 days into the ACoS of
Headline Search Ads, which also
included the sales of third-party
sellers. Not until after the stock at
Amazon had been checked with a
bit of delay, could it be seen that
although customers clicked on the
ad, they actually ended up buying
the cheaper offer from a third-party
seller instead. Thus, the product
sales had, in fact, not increased
while the campaign was running.
This was aggravated by the fact
that Amazon started purchasing
the product from other countries
because of an increased demand
shortly before the campaign was
started – which was indicated by
the absence of inventory changes.
Not until all these factors had been
considered was the actual ACoS
certain.
Thus, the ACoS figures must
be treated with caution: over the
period of some months, the ACoS
accurately represents the success of
a campaign and thus is indispens-
able for long-term analysis, but the
short-term ACoS figures are not
conclusive and should not be the
basis for Return on Investment (ROI)
decisions. It is extremely difficult
to get the ACoS for specific dates
since Amazon provides data on a
daily basis, yet includes all the sales
generated in the last 14 days. In
addition, there are different factors
affecting the daily figures, including
changes in the price of the adver-
tised product by Amazon, third-
party sellers adjusting their prices,
too many good or many critical re-
views for the advertised products
being featured; etc.
Additionally, you should mind
the seasonality of e-commerce.
Bank holidays, special events and,
last but not least, e-commerce-
specific phenomena like Cyber
Monday can distort the AMS figu-
res. Therefore, an accurate AMS
analysis has to be conducted regu-
larly over a long-term period until
you get a feeling for the halfway
normal from which you can evaluate
the individual figures.
These experiential values, to-
gether with the analysed data, must
be included in the continuous op-
timisation of AMS campaigns to
note sustained improvement – at
best, on a daily basis; at least, on
a weekly basis. Thus, it is regarded
as imperative to:
• Include well-performing key-
words from automatic campaigns
into the manually adjusted ones
• Adjust the CPC bids gradually
for the keywords already inclu-
ded according to the campaign
objective – always in due consi-
deration of the effects of the last
adjustment
• Delete underperforming key-
words (and include them in an
index so that they do not find
their way back into other cam-
paigns later on)
• Include negative keywords and
adjust the degree of correspon-
dence to reduce unwanted clicks
• Include well-performing key-
words in the content of the res-
pective products to improve the
organic ranking as well
42
Reacting to seasonal changes is al-
so part of the optimisation. Espe-
cially in the first months of working
with Amazon Marketing Services,
advertisers tend to underestimate
the effect that special events can
have on the sales on Amazon. When
you start your AMS campaigns in
January, you will be surprised how
fast the budget is exhausted in the
first few bank holidays of that year.
Amazon internal programmes like
Prime Day are also extremely im-
portant: when you increase your
budget by 150% for Prime Day,
you can reasonably expect a 150%
increase in sales – without having
to adjust the campaign any further.
Another reason for taking part in
those events is that sales tend to
decrease afterwards as many cus-
tomers already purchased their
desired products for a cheaper
price while the event was taking
place. Other common mistakes
regarding the budget include in-
sufficient limits that are already
exhausted before the day is done.
Although many customers browse
through Amazon during the day,
most sales are generated after
work. When campaign budgets
are prematurely exhausted, adver-
tisers have paid for the clicks wi-
thout generating any conversions;
at the end of their day, shoppers
click through other advertisements
until they reach their final purcha-
se decision, potentially for a com-
peting product. For this reason,
the performance of newly set up
campaigns also must be checked
in the evening when people are at
home shopping online.
You need to get to know the
effects that such an event can
have as well as the sector-specific
conditions and the buying beha-
viour on Amazon as quickly as pos-
sible. If you gather experience now
and optimise systematically, you
will be one step ahead of the com-
petition – and will have bought into
a promising residential area at the
right time when real estate prices
were still moderate.
Best Practice
Planning the budget based on the
calendar and one’s own experience
is key since the budget cannot be
adjusted for the same day. If you rea-
lise that the standard budget limit
is insufficient one day before Christ-
mas, you are too late!
43
CHAPTER 5 THE AMS ROCKET
What Amazon Marketing Services will have in common
with the real estate industry in the future
The opportunity to increase sales
by means of AMS can no longer
be ignored by big market play-
ers. Amid the complexity which
should have become apparent in
the previous chapters, the chan-
ces of growing by means of AMS
are excellent. That being said, es-
tablished brands, in particular, are
in danger of turning their backs
on this issue and suffering heavy
losses later. Advertisers who act
quickly and understand how early
they can overtake their competition
via AMS, with little budget but a
great amount of energy and moti-
vation, hold the winning hand.
Likewise, the danger that com-
petitors establish themselves quick-
ly on Amazon is real. To reference
Monopoly once more, if whole
colour groups are bought up and
built upon with houses and ho-
tels, it gets very hard on the board
for those who come too late. The
much-cited example of the elec-
tronic retailer “Anker” shows how
that works. If you are looking for
“external battery pack” on Amazon
today, you will probably see lots
of Anker products ranking better
than the equivalent products by
Samsung, Sony, etc. Although the
latter are also available offline, they
have been overtaken by a start-up
company on the most important
online market place in the world
– as well as in the perception of
many customers. The situation
is even more severe when you
search for the latest new topics
like “Bluetooth headphones.”
You will not find products by the
established brands at all on the
first search results page. Brands
and manufacturers who do not act
quickly will miss their chances of
being part of a fast-growing mar-
ket. In the same way that the sen-
tence “I should have scarfed up on
that place in Hackney” became
the litany of a whole generation,
many marketing managers will ask
themselves in a few years: “why
didn’t we start earlier with AMS?”
The Amazon Marketing Ser-
vices environment will become
more and more complicated and
uncomfortable within the next few
years. When Headline Search Ads
and Product Display Ads can be
utilised by sellers as well, there
will be a spasmodic increase in
the necessary amount of CPC
bids, which is precisely the rea-
son Amazon is going to open
that flood-gate sooner rather than
later. When that happens, even
more know-how and even better-
optimised campaigns will be ne-
cessary to be able to address cust-
omers succesfully and efficient-
ly. The rapidly growing importan-
ce of Amazon as the #1 product
search engine creates a paradigm
shift and, ultimately, a budget shift.
After Google SEO came Amazon
SEO. Amazon Marketing Services is
the successor of Google AdWords.
Currently, we are witnessing one
of the most radical changes in
online marketing since Google Ad-
Words hit the market in 2000. Ac-
tively help shape your marketing
environment on Amazon now – for
your products and especially for
the future relevance of your brand!
44
LEDVANCE, with its headquarters in Garching near Munich, Germany is
an international company for lighting products and networked light ap-
plications that evolved from the divestment of OSRAM Licht AG in July
2016. It combines traditional lighting products with modern, pioneer-
ing lighting technologies. The company employs around 9,000 people
in 120 countries around the world.
Klaas Heinrichs is the Sales Director eTail EMEA at LEDVANCE and
is responsible for the Online Marketing sector within the LEDVANCE
e-commerce Unit. In this role, he has defined and organised market
place activities and online marketing campaigns since February 2016.
In doing so, LEDVANCE pursues ambitious sales and internationalisa-
tion targets.
How long have you utilised AMS
and how would you describe your
experience with it?
Was LEDVANCE able to increase
its sales via AMS in the long run?
We at LEDVANCE have utilised AMS since February 2016 in four coun-
tries. So far, I have had positive experiences with it, baring its constraints.
The performance, as well as the increase in market share, have proven
positive, but we as a company still struggle with the AMS processes
and the maturity level of the tool.
Definitely: yes. By means of the respective strategy and continuous
optimisation, AMS draws the attention of potential customers to our
products – exactly when they have the intention to purchase them.
Klaas Heinrichs
45
Would you recommend AMS to
manufacturers who want to launch
new products? What is your expe-
rience?
In which countries do you utilise
AMS, and are there any differences
between the markets?
Do you have any advice for col-
leagues who have just started with
AMS?
AMS is extremely effective for products that are not (yet) best sellers. The
tool enables the highlighting of underperformers and the launching of
new products and assortments. AMS improves the visibility of our smart
home assortment and addresses potential customers with the oppor-
tunity of smart lighting technologies for their homes. We also push our
new design-oriented filament assortment so that customers see the va-
riety of our products. AMS, however, does not provide sure-fire success.
It requires holistic knowledge about the Amazon cosmos, and a weak
product without potential or reviews is not going to be a top seller just
because of AMS.
We use AMS in Germany, USA and UK and we are a part of the Ama-
zon pilot project in France. Bid prices differ from country to country and
depend on the competition. Anyway, a strong brand awareness improves
the performance, but the AMS strategy should be adjusted to the market
and the brand conditions of each country.
A coherent AMS strategy and the integration of AMS into the bigger
picture is key, which means that AMS is not a stand-alone solution, but is
complementary to all online and Amazon strategies. Moreover, I recom-
mend a clear structure of the AMS account and a focus on efficiency and
scalability, especially for international companies. It is also advisable to
get professional AMS support from the start.
NOTES: