By John Lincoln, MBA, co-founder and CEO of Ignite Visibility and one of the top digital marketing consultants in the industry.
Have you ever wondered what percentage of the e-commerce market Amazon has a hold over?
The answer is 45% and growing, according to Statista.
For companies looking to expand their presence on the ever-growing platform — ultimately increasing conversions and boosting revenue — you need to know the latest Amazon marketing best practices.
1. Invest in A+ Content.
If you’re in it for the long game, content will be your greatest marketing weapon.
But it’s more than just a trend, and you need to take it seriously. This means developing content you’ll be proud of now and down the line.
You can get started by logging onto your Seller Central, visit the “Advertising” section and clicking “A+ Content Manager.”
When it comes to Amazon marketing, you can use content of all kinds to make your customers a part of your community. Email is one of the primary ways to do this. Welcome emails are probably your greatest chance at conversions, bringing in 320% more revenue than other types of promotional emails.
Using affiliate marketing to bring your Amazon products to a wider audience can help you generate impressive revenue. This is a type of influencer marketing, whether you use verified social media figures as your throughline. (For example, Minimalist Baker’s preferred ice cream maker page has been around for a while, but I can personally attest that it’s still making conversions.)
Whatever the content, you want to stay front and center for the right audience — not just any audience. Add the A+ Content Manager to your docket to enhance your content’s reach.
2. Scale your ads based on advertising cost of sales.
You can attribute advertising cost of sales (ACoS) to your Amazon advertisements.
This metric is a percentage that helps you figure out what you should bid for a particular ad placement. Specifically, it tells you how much money you spend on advertising for every dollar of revenue you make.
To get your ACoS, take your total ad spend and divide it by your total sales. If your resulting number is 0.25, your ACoS is 25%. In other words, you’ve spent $25 on every $100 you made.
This number includes your total ad spend, but it doesn’t include other expenses like the cost of goods sold and Amazon merchant fees. A “good” ACoS is average, around 30%. A low ACoS means higher profitability, but it’s not the end of the world if you don’t reach it.
Whatever helps you achieve more sales is a good thing, even if it means spending a few extra dollars on Amazon marketing. In short, there’s nothing wrong with a benchmark-level ACoS.
When it comes to Amazon pay-per-click advertising, ACoS is everything. Once you have your percentage, determine how to approach your Amazon marketing moving forward. After all, it should be a dynamic process rooted in key metrics like this.
3. Look at your competitors’ offerings and beat them.
In order to outrank your competition on Amazon, you need to know who you’re up against in the first place. This means taking the time to define your competition and analyze their performance.
Ask yourself a couple of questions in particular. What keywords are your competitors ranking well for? How can you target those keywords and slide up in ranking yourself, ultimately beating them out with your own retail offering?
Amazon Sponsored Ads lets you track your competitors’ keywords. Once you know which keywords you’re dealing with, you can target them with your Amazon marketing ads.
But it’s not just keywords you should be paying attention to. You’ll also want to look at Amazon reviews and ratings. Analyzing your competitors’ reviews will help you understand if you need to improve your deliverable and, if so, how you can go about it. You’ll be able to determine demand for the product as well as the buyer persona you’re looking to target. Performing these analyses at scale will go far in your Amazon marketing strategy.
4. Take advantage of Fulfillment by Amazon and win the buy box.
The Amazon buy box is the “Buy Now” option that Amazon users see on a product listing. This allows people to bypass the option to consider seller options and instead go straight to purchasing.
As for which seller gets the deal, Amazon rotates between eligible sellers.
They haven’t publicly listed their determinants for eligibility, but Amazon marketers can assume that merchants who use Amazon fulfillment centers (Fulfillment by Amazon, or FBA) are more likely to win the buy box. You can also get brownie points for using Seller-Fulfilled Prime (SFP). However, you need to hit certain performance quotas to be eligible for SFP.
You don’t necessarily have to have the lowest price, but your shipping time, stock availability and customer response time all likely have a say.
The buy box is a huge win for merchants. Last year, nearly 83% of Amazon sales came through the buy box. You definitely want to focus on getting your shipment performance in tip-top shape in order to become eligible for the Amazon buy box.
Amazon Marketing Will Be More Competitive In 2021
A growing e-commerce industry means stiff competition for retailers looking to sell on the web’s largest multimerchant platform. However, there’s a major opportunity for anyone who can commit to quality offerings and service.