During this last month, the demand for online deliveries in the United States and Canada has surged, forcing Amazon to make an immediate 500 million USD investment to reinforce their staff with more than 175,000 workers. It is not the only change this marketplace has undergone: Amazon’s online advertising platform continues with its regular activity, although it is experiencing significant fluctuations in their data.
Analysis of the decrease in impressions for Amazon Sponsored Products
Since the end of March, Amazon advertisers in the United States have experienced a downward trend in the number of impressions for their Sponsored Products, this is because of recent changes the marketplace has made to the algorithms that regulate its advertising platform. It is essential to highlight that this trend only affects Sponsored Products; the behavior of other advertising formats has not altered.
Even though the impressions have decreased, the amount of clicks has remained constant, which has caused the CTR of these ads to shoot up, almost doubling the numbers reached by adverts before the update. This way, product traffic does not vary, and consequently, advertisers’ results have remained stable. However, a great part of the lost impressions comes from adverts placed in locations other than the top of the first search page.
The update of Amazon’s advertising platform has brought out to our attention the importance of bid distribution in Sponsored Products depending on their location within the marketplace. Currently, this is a determining factor in the design of campaigns in order to obtain greater control over an investment.
Pilar Martínez, Senior Digital Marketing Consultant at Labelium Group
How are the CTRs behaving by type of location?
The performance of Sponsored Products will greatly depend on its location within Amazon’s advertising platform. This way, ads placed in rest-of-search positions are registering a lower CTR rate when compared to those that are placed in the product page or top-of-search positions. In fact, if we contrast the latter with rest-of-search locations, ads’ CTR multiplies by twenty in the case of top-of-search instances and by three in the case of product pages.
The main features of each location are:
- Top-of-search: ads appear in the upper part of the first two search result pages of the platform’s search engine. This position has a higher price in the bids, since the best places are usually taken by the highest bidder. The products that appear in the first search page accumulate a CTR that is 67% of the marketplace’s total.
- Product pages: these refer to the Sponsored Products that appear in product description pages, as well as all the locations that are not related to searches. Normally, the performance of these pages is ten times lower than top-of-the-search ads, but this does not mean they are not interesting within campaigns designed in Amazon Advertising’s platform.
- Rest-of-search: these are the products that appear from the middle and lower parts of the second result page to the end. Amazon does not allow changing the results for this location, which is why the most intelligent course is to set the bid first and then modify the other two available places in order to adjust the results of the adopted strategy.
Optimizing by location in Sponsored Products campaigns
In light of the analyzed results after the decrease in Amazon Advertising impressions, we can conclude there is no reason for advertisers to be concerned. The drop in impressions leads to an increase of the CTR since click behavior remains stable.
Amazon’s advertising platform introduces changes constantly. Advertisers that take these into consideration in their campaigns sooner will achieve a substantial improvement in the results.
Pilar Martínez, Senior Digital Marketing Consultant at Labelium Group
However, advertisers must adjust their campaigns and be careful when it comes to optimizing their strategy by location: raising the investment to top-of-search is causing a greater click volume, and therefore, a greater cost.
Due to the current volatile situation, counting with a partner that is an expert in Amazon Advertising is a great help to ensure the campaigns in the platform achieve satisfactory results. In this sense, Labelium’s extensive experience as a global e-retail agency is a guarantee for the advertisers, thanks to their deep knowledge of the platform and their focus on results.
