Today we have Brian Johnson of Sponsored Product Academy (& PPC Scope) to talk to us about PPC and the REAL reason for the end of Amazon incentivized reviews.
This is a guy that has been in ecommerce industry for years. He started out selling banking equipment on eBay for seven years before a friend pulled him into Amazon. He began launching his own private label products. This was about three years ago when Amazing Selling Machine launched.
Soon after that he got in touch with a large company that was struggling on the Amazon platform and needed help. Brian slowly shifted into doing more consulting work once he saw the demand there. He found that the greatest need came down to visibility.
He needed to do more marketing which meant Pay-per-click Amazon ads. Once he began researching Amazon PPC, he found that there simply wasn’t enough information out there. He decided he had to teach himself. Like many entrepreneurs, his success came about solving the problems he faced.
In October of 2016, Amazon announced the end of Amazon incentivized reviews. Sellers could no longer give products away in exchanged for a review. This was a major change because, until that point, incentivized reviews was the biggest ways for Amazon sellers to launch new products. In their press release, Amazon cited the reasons as wanting to improve the user experience. Which makes sense because so many reviews were fake.
This started a bit of a frenzy among Amazon sellers. No one really knew where to go from there. It soon became clear that the best way forward was to focus on Amazon PPC. Sellers began to turn their attention, and their sole attention, to Amazon ads in order to drive traffic. It didn’t take long for Amazon PPC costs to begin to rise. Brian did some research and realized that the cost increase began about a week after Amazon’s announcement. It became quite clear that this was the new norm and not simply temporary spike. Amazon sellers began seeing advertising costs increased by as much as 5-10%.
For Free video training from Brian, click on the video image below:
It may have not been Amazon’s main intention for the end of Amazon incentivized reviews, but they did see a major increase in profit because of it. In the course of his research Brian saw that you were still able to use Amazon Vine. This is Amazon’s programme for paid reviews. Instead of using a third party option, you could pay to use Amazon’s program which starts at $2500 a product. Brain also found that Amazon makes a lot of money from PPC. Over a billions dollars a year. With PPC costs rising by 5-10%, that’s a lot of money Amazon made by eliminating Amazon incentivized reviews.
You don’t want to get swept up in the Amazon PPC craze. Everyone is moving to PPC, they are flooding the market, and driving up costs. You need to figure out how to sell in a 2017 Amazon.
Don’t listen to seller support. One of the biggest mistakes Brian is seeing is following the wrong advice. They call up Seller Support which tells them to run one campaign and increase their bid. These reps are not trained property and they simply give bad advice. They don’t understand how the platform works.
This works well for Amazon. They make more money and can quickly clear out their support tickets. It doesn’t work well for sellers that can afford to waste a lot of money by throwing it away in Amazon ads.
Amazon PPC is a complex system. There is not one size fits all. Each product is different. They have different customers, different click through rates, so you have to run a solid PPC campaign.
Not only does Amazon look at your products, but they also look at the customers. Sometimes they will show your ads to audiences that are related to your products. These tend to be very inefficient. It used to be that you could just run negative keywords and block the search terms from displaying you ads. Now you have to be more hands-on.
As sellers we tend to be lazy when it comes to our Amazon audience of shoppers. Amazon does such a great job of bring the correct shoppers to us, that we tend to focus solely on the products rather than who is buying our products. This is a mental shift that we all must make.
One thing we do as sellers during product research is that we focus on what our competitors are doing and misinterpret why they are successful. We see that they have a keyword in the title and assume they are doing well because of that. That is ignoring the fact that every product is selling based on dozens of different keywords. No product will rank for just one keyword.
We have to do a better job understanding our audience, and the search terminology that brings them to our products. We spend all this time focusing on one keyword, and then learn, through PPC, that it’s not a converting keyword for our product. PPC is a great marketing research tool we have to use. It’s the best way of determining who the audience is, and what converts.
Proper campaign structure will give your product individual exposure to an audience. One thing to ensure is to never lump together several products in one ad group. Separating them out will allow you to determine, according to the Amazon reports, who the audience is for each product, rather than a group of products.
One thing to keep in mind is that Amazon sponsored ads don’t necessarily behave in a logical manner, especially if you’re coming from Google Adwords. Adwords has more options to fine-tune your ad. Much more than the four we have on Amazon (which include broad, phrase and exact match).
The logical idea is to start broad with your ads, and narrow down to an exact match. It’s logical to think that you’ll have better conversion rates. That’s how it works with Google Adwords. That tactic doesn’t always work with sponsored products because Amazon has all the buyer data. This allows them to show ads in different situations based on the buyer’s shopping history. You can’t just throw your keywords into exact and be done. You have to test in all match types so you can find which keywords work for which match type for your product.
There are good way of testing, and bad ways of testing. The important thing to remember is that you have to test. Even if the test go against conventional wisdom. You won’t know for sure until you test it. One mistake sellers often make is splitting their match types into different campaigns. They will have exact match as a different campaign than their phrase match. It reduces the efficiency of the PPC algorithm.
One super important point:
There is a different algorithm for sponsored positioning than for organic positioning.
So a classic mistake is taking what works for organic results, and using them with sponsored. Organic results ranking rely heavily on relative conversion rates – how many units are you selling compared to other product in the niche.
Sponsored ads rely much more on how the advertising campaign performs and its ability to bring customers into a product listing. Amazon is looking for people to click on the ads which you then pay for and Amazon makes money. So Amazon rewards your campaign with better positioning, if it generates more clicks.
This is all about the customer experience. The worst thing for Amazon is to have customers get confused, not find what they’re looking for, and leave the site without buying anything. The best thing is to show the customer what they’re looking for as quickly as possible, which leads to higher close rates. The better we are at advertising our own products and getting the customer to click on our ads, the more likely the customer is to convert.
There are many reasons why Amazon might not even show your ad. On top of that, Amazon’s algorithm determines whether or not they will consider showing your ad. If they don’t, if you are filtered out, it’s usually due to one of two things:
The first one: the product doesn’t qualify. Maybe it doesn’t have the buy box, or it’s not allowed to run ads, or it’s not allowed to run ads on a specific keyword (for example trademarked terms like “Nike”).
The second pass/fail is relevance. Is the product in a sub-category that is relevant to the search term? And does it match the keyword the seller is advertising for?
The best place to get more info is in Brian’s free training at Sponsored Product Academy. There are 4 free videos about this whole area. Just click on the video image below to access that:
The Academy full course itself It is very in-depth training. It’s about a 5-week course. It’s the best place to start if you want to dominate your competitors in advertising. But start with the free videos and take it from there.
For a complete list of free resources, please visit amazingfba.com/brianj