Understanding Amazon Advertising Sales is a bit tough for many people out there, so what actually does Amazon Advertising Sales mean? Continue reading to get familiar with the term.
Amazon has had its hand in advertising for a long time. In the early days of its e-commerce business, Amazon began as an advertising reseller, partnering with third parties to place ads on its site. With over 540 million monthly active users, and a constant stream of new user data that it can tie to each customer’s individual account, Amazon is no longer just a retailer but also a highly valuable advertising partner. Today, Amazon is one of the largest digital advertising partners for brands, publishers, and advertisers alike. Understanding what makes Amazon such an attractive partner for brands and publishers can help you get more value from your partnership with them.
This article will give you everything you need to know about how Amazon uses advertising as partner. You will also know more about Amazon's Advertising strategy as well.
How Amazon Makes Money from Advertising
Amazon makes money from advertising in two ways. First, it earns a small portion of the ad spend by selling ads directly to advertisers. Amazon takes in a little bit of revenue from each purchase made through the ad. In addition, the company also earns a cut of the revenue generated by the click-throughs or impressions that its ad network generates for other sites. Advertisers typically pay a specific rate per thousand impressions (CPM) to have their ads shown to a particular group of people. For example, if an advertiser wants to reach women aged 25 to 34 who are interested in cooking and have an annual income of more than $40,000, they might pay $12 per thousand of impressions.
Why is Amazon Advertising Successful?
Amazon is not only a E-commerce giant but also an Advertising Behemoth. Amazon attracts advertisers because it has a large, engaged audience that is willing to click on ads. As many E-commerce platforms continue to grow, there is a huge potential for Amazon's Advertising Business to become much more prominent. Amazon's Advertising Arm is eight times larger than Snapchat's entire business and nearly seven times as large as Twitter's. If you’re an advertiser looking for high return on investment (ROI), Amazon is an attractive option. Because of the sheer size of Amazon’s audience and the amount of time people spend on the platform, advertisers get a lot of exposure on Amazon.
Amazon claims its ad network delivered 2 billion ad impressions worldwide in a single day. A study from Marketing Land found that the average Amazon click-through rate was 1.18%, compared to 0.08% for a banner ad on a publisher’s website. Another study conducted said that Amazon's Advertising Revenue was close to being larger than that of Microsoft, along with other challengers like Pinterest and Snap.
Interesting Point– Amazon's Ad Business Generates more Revenue for the company compared to its physical stores and its own subscription services.
Types of Amazon Ads
Amazon offers several kinds of ads to suit different kinds of advertisers. These include product display ads, sponsored product ads, headline search ads, and sponsored brand ads, Product display ads. Product display ads are used by advertisers in the B2B and B2C industries. The ads can be created with images, videos, and information about the products and can be targeted to specific audiences. Sponsored product ads. Sponsored product ads are used by advertisers in the B2C industry.
They allow advertisers to promote their products on Amazon, and the ads are only shown to visitors who have searched for items related to the product. Headline search ads are used by advertisers in the B2B industry who want to show ads to people who have searched for certain topics or keywords. Sponsored brand ads are used by advertisers who want to increase their brand awareness and drive traffic to their websites. The ads are shown in categories related to the brand and feature the brand name and logo.
Audience Targeting
Because of Amazon’s massive reach and the amount of data it has about its users, Amazon offers a variety of targeting options that aren’t available through other digital advertising channels. For example, Amazon allows advertisers to target audiences based on their website visitation. This means brands can target customers who have visited their website, but may not have purchased anything. Amazon also offers demographic, behavioral, and interest based targeting. The demographic targeting allows advertisers to target people based on their age, gender, and household income. Behavioral targeting allows advertisers to target based on past website visits and what they search for. Interest based targeting allows advertisers to target based on specific likes and interests.
Product Display Ads
Amazon’s product display ads are meant to increase brand awareness and drive foot traffic to a seller’s store. The ads will show up on Amazon’s product pages and in search results on Amazon. These ads are designed to give Amazon sellers a chance to show off their products on the marketplace. They appear just below the “also bought” section and are designed to make a product look more attractive. An example of a product display ad on Amazon.
Sponsored Products
Sponsored products are an ad format that drives traffic to Amazon products. These ads are shown on the Amazon marketplace, as well as external websites. Amazon’s sponsored product ads display a product image and description, and include a “buy” button below the image. These ads are meant to entice customers to buy products directly from Amazon. Another ad format created for Amazon sellers is product comparison ads. These ads allow you to create two images and descriptions, and then let Amazon’s system automatically rotate between the two. This is an effective way to highlight the advantages of your products over others in your category.
Bottom line: Understanding Amazon Advertising Sales
Amazon is a great partner for brands looking to advertise their products, services, and websites. It has a massive reach and brings in a constant flow of new data that can be used to refine targeting options. The Ad Revenue Business of Amazon is also comparable to the advertising revenue of the entire global newspaper industry. Amazon’s data-driven ad platform makes it easy for advertisers to target their ideal customers. If you’re looking for a way to drive traffic to your website or sell more products online, Amazon’s advertising platform can help.