Blog, Amazon Vendors, Briefing

Maximizing Amazon Sponsored Ads: The key to incremental sales

Learn how to optimize Sponsored Ads for maximum incremental sales by understanding the impact of high and low organic visibility keywords and leveraging the right tools.

Author:

Benjamin Weyrich

Main takeaways:

Identifying Incremental Sales from Sponsored Ads:

Understand the direct impact of your advertising efforts by analyzing sales that wouldn't have occurred without your ads.

Differentiating Between High and Low Organic Visibility Keywords:

Optimize ad spend by targeting keywords with low organic visibility to maximize incremental sales.

Utilizing Tools to Measure and Enhance Visibility:

Leverage analytical tools to assess and enhance your advertising strategy effectively.

Advertising on platforms like Amazon can propel your product visibility and drive sales, but distinguishing between direct and organic sales influenced by ads is crucial. Incremental sales, the additional customers your ads pull in, are the heart of effective advertising campaigns. Using the analogy of a lemonade stand, if a sign (your ad) brings in 5 new customers above your regular traffic of 10 customer, those 5 are your incremental sales, essential for assessing the effectiveness of your advertising.

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Assessing Organic vs. Paid Visibility

Let's delve into the concept of organic visibility on Amazon: If your lemonade stand is already the most popular on the street, putting up a sign might not draw many new customers because most people were already patronizing you. This scenario mirrors having high organic visibility for a keyword. Consequently, investing in ads might not contribute significantly to incremental sales since you're already the preferred choice.

But if your lemonade stand is new in a neighborhood where awareness is low, a sign can significantly impact attracting new customers. This scenario resembles having low organic visibility for a keyword. Advertising under these circumstances is likely to generate higher incremental sales, as the ads will introduce your product to consumers who wouldn't have otherwise discovered it.

Practical Advice for Advertisers:

Evaluate Organic Visibility:

Begin by assessing where your product stands organically for relevant keywords. Is it already visible without the need for ads?

Tailor Your Strategy to Visibility:

If your product ranks organically for specific keywords, consider moderating your ad investment for those keywords. Incremental sales potential may be limited here
For keywords where your product lacks organic visibility, concentrate your ad spend. This is where the prospects for gaining incremental sales are greater

By following these principles, you can make more insightful decisions about how to spend your advertising budget and maximize your ROI (Return on investment). It's about finding the perfect balance between leveraging your current popularity and reaching new customers who have yet to discover your offering.

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Leveraging tools for strategic insights

Tools like Catapult can be invaluable for advertisers. They help assess keyword visibility and potential for incremental sales, ensuring your advertising budget contributes to genuine business growth, rather than merely offsetting what would have been organic sales.

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Putting the pieces together

Understanding these nuances enables better strategic decisions and can be enhanced by platforms like Catapult, which provides real-time, integrated data views across departments, crucial for manufacturers operating in multiple countries. Our tool, crafted with input from Amazon vendors, features a centralized dashboard that automatically converts Amazon data into a clear, actionable perspective on your performance.