Understanding Amazon Sponsored Display Advertising Campaigns

In today's e-commerce field, where over 61% of product searches in the US begin on Amazon, brands are constantly searching for ways to improve their visibility and sales. One effective method to achieve this is through Amazon's Sponsored Display advertising campaigns.

These campaigns enable sellers and vendors to reach a highly targeted audience on and off Amazon, making it a powerful tool for driving conversions and growing business.

In this blog, we'll explore what Amazon Sponsored Display is, how it works, and how you can make the most of it for your business.

What is Sponsored Display, and How Can it Help Your Business?

Amazon Sponsored Display advertising is one of the most popular tools available to sellers and brands looking to increase their visibility on Amazon. It enables advertisers to display their products in various locations across Amazon’s platform.

It displays ads on product detail pages, search results, and other parts of the Amazon ecosystem, on third-party websites.

These ads are designed to target customers based on their shopping behaviors and interests. This makes them highly effective for reaching potential buyers already in the purchasing mindset.

Unlike traditional display ads, which often target broad audiences, Amazon Sponsored Display ads allow advertisers to hone in on customers who are more likely to convert.

The Business Benefits

For businesses, Amazon display advertising offers several key benefits as mentioned below:

Broader Audience Reach: With the ability to target both Amazon shoppers and those browsing external websites, your products can be showcased to a much wider audience.
Increased Visibility: Sponsored Display ads help your products stand out in a crowded marketplace, allowing you to attract more attention from potential buyers.
Enhanced Targeting: With access to Amazon's vast customer data, you can target your ads based on browsing history, interests, and demographics, improving the likelihood of conversions.
Cost-Effective: Since the campaign operates on a cost-per-click (CPC) model, you only pay when someone clicks on your ad. This ensures that you're investing in actual engagement with your potential customers.

Now that we’ve discussed Sponsored Display ads and their benefits let’s first take a look at what these ads look like and how their design can help grab customer attention.

What Does a Sponsored Display Ad Look Like?

Amazon Sponsored Display ads come in a few different formats to match the context and layout of the pages they appear on. These ads are designed to be visually appealing and user-friendly, ensuring they seamlessly blend into the shopping experience.

Ad Formats

Here are the ad formats for Amazon Sponsored Display advertising:

Product Display Ads: These ads are typically shown on product detail pages and search results. They display an image of the advertised product, along with a title and price. This is the most common format and aims to drive immediate purchases.
Category Display Ads: These ads appear on the category or subcategory pages, offering more exposure to potential customers browsing specific product types.
Custom Display Ads: These are highly customizable ads that allow advertisers to choose different visual elements, such as banners, to make their product stand out more effectively.

Visual Appeal

The key to Sponsored Display ads is their simplicity and alignment with the user experience. They typically consist of a product image, a brief description, and a link that directs users to the product page for more details.

The overall design ensures that users are not distracted from their shopping journey, making it more likely that they will click on the ad and consider purchasing.

Now that we’ve covered the appearance of Sponsored Display ads, it’s essential to understand how they function and how they can help you target potential buyers effectively.

How Do Sponsored Display Ads Work?

Amazon Sponsored Display ads function similarly to other display ads in that they focus on targeting potential customers based on behaviors and interests. However, the strength of Sponsored Display lies in its integration with Amazon's vast data ecosystem.

Behavioral and Audience Targeting

Sponsored Display ads utilize Amazon's data to display your ads to users who are most likely to purchase. These ads can target the following:

Remarketing: This allows you to target users who have previously viewed your product or a similar product but did not make a purchase.
Audience Targeting: Sponsored Display ads can also reach specific audience segments based on interests or shopping behavior, even if they haven't interacted with your product before.

Automatic vs. Manual Targeting

You can choose between automatic and manual targeting. With automatic targeting, Amazon uses its algorithm to decide where your ads should appear based on the product you're promoting and customer data.

On the other hand, Manual targeting lets you specify which audience segments or products you'd like to target.

Once you know how Sponsored Display ads operate, the next logical question is: where exactly can you expect to see these ads appear? Let’s explore the different placements where your ads can shine.

Placement of Sponsored Display Ads

The placement of your Sponsored Display ads is key to their success. Amazon places these ads strategically across various locations to ensure maximum exposure.

Here’s where these ads typically appear:

In-Amazon Placements

Sponsored Display ads appear in the following places on Amazon:

Product Detail Pages: Ads can appear directly on a product’s page, typically below the product description or in the “related products” section.
Search Results: Sponsored Display ads also appear within Amazon's search results, usually above the fold or beside the organic search results.
Product Collections: These ads are shown within curated collections, which can help your product stand out in a group of similar items.

Off-Amazon Placements

Additionally, Sponsored Display ads can also appear outside of Amazon on third-party websites. These placements are useful for remarketing to potential customers who have interacted with your products but haven’t made a purchase yet.

With placement covered, let’s turn to cost—because effectiveness must also fit your budget.

Also, read Amazon PPC: Step-by-Step Guide to Sponsored Product Campaign

Pricing for Sponsored Display Ads

Sponsored Display ads follow a cost-per-click (CPC) model, meaning you only pay when someone clicks on your ad. This ensures that you’re only paying for actual engagement rather than just impressions.

For Sponsored Display Ads on Amazon, you can expect to pay, on average, $0.94 per click (CPC) per 1,000 viewable impressions (vCPM). Still, costs vary based on competition, targeting, and bidding strategy.

Bidding System

Advertisers set a maximum bid amount for each click, and Amazon’s system determines which ads are shown based on these bids. The CPC you pay will depend on the competition for the target audience and your chosen bid amount.

However, you can also control your budget by setting daily and campaign-specific limits, helping you manage costs.

Advertising success depends on competitive bids, but manually tracking and adjusting them is time-consuming and prone to error.

SellerMate's live ads feature empowers you to automate your bid adjustments, ensuring your ads maintain desired rankings while minimizing manual intervention. It allows you to intelligently optimize your bids, keeping you ahead of the competition and within your budget.

It lets you automate your bid adjustments and maintain desired ad rankings, as well as ensure your ads stay competitive with minimal manual intervention.

Now that we’ve covered the basics, you may be wondering how you can actually start using Sponsored Display ads for your own campaigns. Let’s walk through the steps to get you up and running.

How to Get Started with Sponsored Display?

Starting with Sponsored Display is relatively straightforward, even for newcomers to Amazon advertising.

Here's how you can get started:

Set Up an Amazon Advertising Account: If you don’t already have one, you’ll need to create an account with Amazon’s advertising platform.
Choose Your Product: Decide which product you want to advertise. You should choose high-performing products that have already seen some success in your store.
Select Your Targeting Options: Choose between automatic or manual targeting, and decide whether you want to target specific audiences or retarget users who have viewed your products in the past.
Set Your Budget and Bids: Set a daily budget and choose a maximum bid for your ad placements.
Create the Ad: Choose the format and design of your ad, making sure to include a clear call-to-action and relevant product images.

Once your Sponsored Display campaign is live, proper management is crucial for optimizing performance. Here, we’ll go over the key steps to keep your campaign running smoothly and efficiently.

Managing Sponsored Display Ads Campaign

Once your Sponsored Display campaign is live, it's essential to monitor and optimize it for performance regularly. This involves tracking key metrics such as click-through rate (CTR), conversion rate, and return on ad spend (ROAS).

Following are the key tips for management:

A/B Testing: Test different ad creatives, targeting options, and bid amounts to see what works best.
Adjusting Bids and Budgets: Monitor the performance of your campaigns and adjust bids or budgets to optimize your return.
Analyzing Performance: Use Amazon's reporting tools to analyze which ads are performing well and which need adjustments.

Finally, to ensure your Sponsored Display ad campaign delivers the best results possible, let’s look at five strategies that can significantly improve your ad performance. This will, in turn, help you achieve your business goals.

5 Ways to Improve Your Campaign Performance

To get the most out of your Amazon display advertising campaigns, it’s important to refine and improve them continuously.

Here are five strategies to enhance your campaign performance:

Use High-Quality Images: High-quality product images can improve the click-through rate and make your ads more appealing. Clear, detailed images help customers better understand your product and make informed purchasing decisions, which can increase conversions.
Optimize Targeting: Focus on the most relevant audience segments for better targeting and higher conversion rates. By refining your targeting based on customer interests and behaviors, you can ensure your ads are shown to those most likely to buy.
Utilize Remarketing: Retarget users who have shown interest in your products but haven’t completed a purchase. This keeps your brand top of mind and encourages potential customers to return and finalize their purchase.
Use Competitive Bidding: Research competitor bids to ensure you’re bidding competitively while still staying within budget. Understanding market trends and adjusting your bids accordingly allows you to maximize visibility without overspending.
Monitor and Adjust Regularly: Keep track of your campaigns and make data-driven adjustments as needed. Regular monitoring helps identify underperforming areas and allows you to optimize your campaign for better results.
Experiment with Ad Formats: Test different ad formats, such as product display ads and custom display ads, to see which ones resonate most with your target audience. Experimenting with various formats allows you to discover the most effective way to showcase your products and drive engagement.

These five strategies will help you increase your campaign ROI, increase visibility, and drive sales. By implementing these strategies, your business is all set for success on Amazon.

Wrapping Up

Amazon Sponsored Display advertising offers a unique opportunity for sellers to expand their reach, engage with potential customers, and ultimately drive sales. By understanding the ins and outs of Sponsored Display ads, you can harness the power of Amazon display advertising to take your business to new heights.

With strategic planning and ongoing campaign management, Sponsored Display ads can become an indispensable part of your e-commerce advertising strategy.

Tired of running ads that don’t work? SellerMate will help you turn your PPC campaigns into a profitable system. With our experience and expertise, you can create ads that deliver results. Book a demo today and take control of your advertising strategy!

FAQs

Q1. What is the difference between Sponsored Products and Sponsored Display ads?

Ans- While both are part of Amazon’s advertising suite, Sponsored Products focus on promoting individual products in search results and product pages, whereas Sponsored Display ads are more versatile.

Q2. Can I use Sponsored Display ads with other Amazon advertising products?

Ans- Sponsored Display ads can be combined with other Amazon advertising solutions, such as Sponsored Products and Sponsored Brands. This allows you to create a more comprehensive advertising strategy that targets customers at different stages of their shopping journey, from discovery to purchase.

Q3. Do I need to be an Amazon seller to use Sponsored Display ads?

Ans- To use Amazon Sponsored Display ads, you need to be a seller or vendor on Amazon. If you’re a seller, you’ll need an active Seller Central account, and if you’re a vendor, you’ll need to use Vendor Central to set up your campaigns.

Q4. Can I use Sponsored Display ads if I have a small budget?

Ans- Sponsored Display ads are flexible. You can set daily budgets and maximum bids to control your spending. You can start with a smaller budget and gradually scale your campaigns as you see results.