Advertising on Amazon

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Amazon Advertising on Amazon

Published on 04.02.2020 by Stephan Lamprecht, journalist

The battle for the “buy box”, the prime spot on Amazon’s product pages, is tough. Amazon Advertising enables merchants to increase their visibility on the platform.

The most coveted space on an Amazon product page is the spot known as the “buy box”, the small area where consumers can add the product to their shopping basket. That said, there’s no guaranteed way to be listed there. Apart from the availability of Prime shipping and of course a low price, “soft factors” such as the retailer’s reputation also play an important role.

But the “Amazon Advertising” programme provides retailers and brands with a tool to increase their visibility on Amazon Marketplace.

Retail media, Amazon-style

As BloomReach discovered back in 2016, Amazon has overtaken Google when it comes to product searches, which is why it’s in every retailer’s interest to be listed in a prominent spot there. And that’s exactly what Amazon Advertising seeks to do, with its concept based on the “retail media” strategy.

Amazon Advertising allows companies to place adverts on the product pages in Amazon Marketplace. Like Google Ads, the programme is based on a “pay per click” (PPC) model. In other words, payments are due only when a customer actually clicks on the advertisement.

Click prices can vary between a few cents and two to three euros. The programme is open to retailers and manufacturers on Amazon Marketplace. Those wishing to advertise on Amazon must therefore join the relevant seller programme or be a registered brand.

The mechanism for placing ads is widely known. Each merchant places a bid for a click. The placement of the ads is determined by an automatic auction, where the highest bidder wins the ad position while also paying the highest price.

The “sponsored products” format appears in the following two positions on Amazon:

  • Search results: at the top, middle, bottom or to the side of the search result
  • Product pages: ad carousel on product pages

The benefits

There are several advantages for advertisers when using Amazon Advertising. These include:

  • Advertised products rank higher in search result listings more often. This ensures greater visibility compared to simple product listings.
  • Since sponsored products are more visible to customers, there’s an opportunity to increase sales volumes of advertised products.
  • Advertisements can be used to specifically draw attention to clearance items or underperforming products.

In order for retailers to get the most out of this form of advertising, they should optimize their product detail pages. The price per click would be wasted if the customer didn’t receive the expected information or if the product presentation was unappealing.

Stephan Lamprecht, journalist

Stephan Lamprecht has been following e-commerce developments in Germany, Austria and Switzerland for two decades as a journalist and consultant.

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