The problem: brands on Amazon want to grow sales, but deciding which marketing and advertising levers to pull can be tricky. And simply dumping budget into every tool without a concerted strategy can be expensive, drastically impacting the profitability of the Amazon channel.
The solution: align your promotions and PPC advertising to get more bang for your buck.
Developing an intelligent promo strategy that aligns with your PPC ad campaigns will lead to an increase of sales on Amazon. In today’s blog post, Bobsled’s Ivana Lekovska has shared her insights and best practices regarding how brands can boost their signal and revenue by employing this approach.
Why should brands use Promotions and PPC in tandem?
PPC ads allow brands to put their products in front of shoppers across the Amazon marketplace. Promotions offer shoppers some form of discount e.g. a 20% off coupon.
There is a psychological aspect to promos that contributes directly to their effectiveness:
- Discounts create a sense of urgency because most are time-sensitive
- Shoppers tend to respond more strongly to loss aversion as they don’t want to miss out on the product while the promo is still running
Put simply, promotions offer potential customers an extra incentive to buy your products. The greater the number of shoppers who view your promotion, the greater the number of successful conversions you will achieve. And a perfect way to boost the signal of your promo is via targeted PPC advertising.
💡 Check out Which Amazon Promotions Work Best?
What Promotions help PPC performance the most?
The Bobsled team agrees; coupons are generally the most effective way to get more visibility for your product on Amazon, and they will help convert a higher number of people that land on your listing.
Another great option is Lightning Deals. However, this type of promo requires sellers or vendors to offer a big discount and a minimum number of units, so Lightning Deals are simply too costly for some brands.
How should I split my marketing and advertising budget between Promotions and PPC?
Firstly, it’s important to understand what your main goals are if you want to allocate your budget appropriately. Broadly speaking, every brand competing on the Amazon platform has two core objectives:
- Brand Awareness – getting your product in front of eyeballs
- Sales – encouraging those eyeballs to buy your product
Therefore, your ideal marketing and ad budget ratio will depend on your immediate priorities. If you’re struggling with brand awareness, consider bumping up your PPC budget so that your products can be found in more places across the Amazon marketplace. If you’re struggling with sales, consider experimenting with more promotions to try and boost your conversion percentage.
Don’t forget that this ratio should always be in flux. Inventory levels, competitor activity, and seasonality are just a few factors that should be taken into account when mapping out your promos and ad campaigns for the upcoming quarter. Looking into historical performance and continuing to test and tweak is imperative if you want to stay ahead of the game.
What are some best practices in terms of aligning
Promotions and PPC?
To achieve optimal growth, implement the following best practices:
- Create a separate subpage on your Storefront for active promotions and launch Sponsored Brand ad campaigns that send qualified traffic to this subpage
Above: Example of a ‘DEALS’ tab on Evergreen’s Amazon Storefront
- Target competitor product listings that are in a similar price range with your products that have active promotions running. When a potential customer sees that your product has 5-25% off compared to the competitor’s product, this may persuade them to go for your brand instead
- Keep a close eye on your competition. If they run any promotions you may want to consider matching their offer in some way
- Always test what discount type works best for your brand: dollar off or percentage off coupons
- Include any products with active promotions in your Sponsored Display campaigns. This ensures savings badges will automatically appear on any new or existing products
Come Together, Right Now!
Adding promos to your PPC strategy while building efficient campaigns with Sponsored Product Ads, Sponsored Brand Ads, and even Amazon DSP retargeting can help boost sales and increase the visibility of your products line. Not only will this approach grow revenue, but it will improve your channel profitability too.