Amazon Launches Sponsored Display Advertising

On Thursday last week, Amazon launched a new advertising campaign type for Vendors and professional Sellers on Amazon: Sponsored Display.

According to Amazon’s announcement, “With this launch, advertisers are able to access Product Display Ads audience and product targeting features within Sponsored Display. All Product Display Ads campaigns are now part of Sponsored Display without any additional action required.”

The new ad type addresses a big gap in Amazon’s pay-per-click advertising suite: the ability to retarget Amazon shoppers. Retargeting is a popular feature for retail brands in particular, and has been long available on display ad networks, Facebook, and Google. It’s also a feature that has been available on Amazon’s programmatic media solution, its Demand Side Platform (DSP). But the DSP requires significant monthly spend in order for advertisers to access it, and ideally also a skilled media professional to effectively manage the channel.

Sponsored Display however is open to millions of Amazon sellers and vendors, and setting up campaigns is simple. You could think of it as “DSP-lite” for advertisers who find the full-fledged programmatic solution out of reach.

But simplicity on the front end does not always translate into immediate return on investment, which is what most smaller brands and advertisers are chasing.

While testing the beta version of the program with a couple of clients, my agency found that Advertising Cost of Sales (ACoS) was generally higher than the account average. But this is expected since it targets people browsing off Amazon as well as those who are actively navigating the site.

This highlights one fairly substantial downside: a lack of customization for audience targeting. Amazon says that audiences are based on shoppers who “showed interest in categories related to your promoted product” or for campaigns that target customers off Amazon, “[customers] who previously viewed your product detail page but haven’t yet purchased.” Advertisers can also target specific products or product categories on Amazon to display their ads on.

Amazon’s full DSP system gives advertisers much more control over their audience, such as targeting shoppers  to target based on specific actions like shoppers who viewed a brand’s products but didn’t buy; or those who recently viewed competing products.

It’s not just audience targeting that is locked down – advertisers are very limited in both where the ads display and the creative that is used. If a brand can’t control which third party sites its ads display on, for example.

Creative – or what text, images, and call-to-action is shown in the ad – is also determined by Amazon and there is no customization ability.

The default bid is listed as $2.00 and the default campaign budget is $100, which is definitely on the high side for PPC campaigns – so be cautious when setting up and reviewing these campaigns as spend can quickly get out of control when using those defaults.

Challenges and unknowns aside, this is still a great addition to Amazon’s performance marketing suite, especially for brands that aren’t large enough for Amazon’s more robust DSP system.

Amazon also makes clear that the solution will expand “Advertisers will soon see additional Amazon Advertising display metrics, such as detail page views, Add to carts, and new-to-brand metrics, that demonstrate how Sponsored Display can further help grow your business,” says the Sponsored Beta information page. The targeting options also have the capacity to improve over time, giving advertisers more control and better results.

[“source=forbes”]