Amazon Sponsored Products Ads, the pay-per-click campaigns that are keyword targeted and appear within search results on the marketplace, are playing a significant role in Amazon’s foray into digital marketing. During the first quarter of this year, Amazon reported $2B in “other revenues,” most of which came from advertising. For Sponsored Products Ads specifically, Amazon’s spend increased 96% year over year. On an upward trajectory as a whole, Amazon’s advertising business is on track to continue growing, with estimates of the e-commerce leader’s ad revenue being estimated at nearly $19B by 2020.
Amazon’s advertising arm, which is driven by data on what consumers buy across a combination of search, display, and video, represents a valid ability to potentially challenge Facebook and Google’s leading positions in the online advertising space. Advertisers are turning to Amazon more and more frequently in order to get their messages in front of engaged online shoppers and increase their visibility. In Feedvisor’s 2018 Amazon User Study, it was revealed that about one-third of Amazon users go straight to Amazon, ready to buy — revealing why marketers have started to see the value in putting their ads directly on the e-commerce platform.
Sponsored Products Ads, which only require retailers and brands to pay for the ads that shoppers click on, will show the relevant products only to shoppers who are looking for what is being offered and based on keywords entered. The ads run within search results and individual product listings. Amazon is in discussions with top brands and agencies about participating in a trial that would let these ads run across the Internet, not just within properties owned by amazon.com. The ads will be delivered to outside websites by retargeted customers who visit Amazon, when they visit those other sites. People who click on the ads will be delivered to brands’ storefronts back on the marketplace, which has potential to be a leg-up for the company as Amazon has the ability for the shopper to click through and make a purchase on the website, whereas Google does not.
In Seller Central, Amazon states that “Sponsored Products Ads [can be found] in a variety of places across Amazon to make it easier for shoppers to find your products. Additionally, Amazon continually tests new ad placements and designs to deliver the best shopping experience possible.” The ads not only aid those customers who know specifically what they are looking for and are ready to buy, but also instill shopper loyalty as the customer is able to find the product with ease. The Sponsored Products Ads are expected to begin running on sites outside of Amazon in the coming weeks.