The Top 5 Amazon Ad Formats to Boost Your Sales in 2023

Struggling to choose the right Amazon Ad formats to help your business? This article will help you out.

It’s no secret that in recent years more and more customers prefer online shopping. According to Statista, the statistics portal for marketing data, by 2024 there will be more than 273 million online shoppers in the United States alone. This opens up more opportunities for businesses to interact with potential customers online. Especially on the Amazon marketplace.

Amazon advertising has become an important channel for brands and sellers to reach consumers on the platform. As of 2021, Amazon’s advertising business has grown rapidly, with revenue reaching $22.4 billion in 2020, an increase of 52.5% from the previous year. Amazon’s advertising platform offers a range of ad formats that cater to different advertising goals, such as driving product sales, increasing brand awareness, and promoting customer engagement. 

Some of the popular ad types offered by Amazon include Sponsored Products, Sponsored Brands, Sponsored Display, and Amazon DSP. Choosing the right format for your advertising campaign is critical to the success of Amazon advertising. Advertisers need to consider their goals, target audience, and budget when selecting an ad format.

For example, if the goal is to drive brand awareness, Sponsored Brands and Sponsored Display ads may be more effective, whereas if the goal is to increase product sales, Sponsored Products may be the better option.

In this guide, UAWC will explain the various ad formats on Amazon and provide you with tips on how to use them best.

Table of Contents

1. Sponsored Products
2. Sponsored Brands
3. Sponsored Display Ads
4. Video Ads
5. Amazon DSP
6. Conclusion

Sponsored Products

Sponsored Product ads are the most popular type of Amazon advertising format. According to Jungle Scout research, 77% of Amazon sellers use it to promote their goods and increase sales. It’s a powerful tool even for newcomers who have never created an Amazon Ads campaign. Sponsored Products generates ads from seller’s product listings and offers automatic targeting. There is an option for manual targeting too, so advertisers can decide which option to choose. 

In terms of ad placements, Sponsored Products appear in search results and product detail pages and are denoted by the “Sponsored” label.

Sponsored Products work on a pay-per-click (PPC) basis, where advertisers pay only when someone clicks on their ad. Advertisers bid on specific keywords related to their products, and the higher the keyword bids, the more likely the ads are to appear in relevant search results.

1. Sponsored Products allow advertisers to reach customers who are actively searching for products similar to theirs. This means that the ads are displayed to customers who are already interested in the type of product being advertised, increasing the likelihood of conversion.
2. They provide advertisers with a high degree of targeting precision. Advertisers can choose specific keywords to target, and can also choose to target customers based on factors such as geographic location, gender, and age.
3. They are easy to set up and manage. Amazon provides a user-friendly platform that allows advertisers to create and launch campaigns quickly and provides real-time data and analytics to help advertisers track their performance and optimize their campaigns.
4. They have a strong track record of delivering results. According to Amazon, advertisers who use Sponsored Products experience an average increase in sales of 50%, making it a highly effective ad format for driving sales on the platform.

Many successful campaigns are using Sponsored Products on Amazon. One of them is LIPPS, a large Japanese franchise for men’s hair care and styling products. In 2019-2022, the company used Sponsored Products to help generate sales. With unique keyword strategies, and regularly fine-tuning product images and videos which contribute to their products’ appeal, the company saw a 2x to 3x growth in sales. Its brand awareness has also improved.

What can you do to optimize Sponsored Products campaigns? Here are some best practices: 

• Research relevant and high-performing keywords to target in your campaigns. Use tools like Amazon’s Keyword Tool or third-party tools to identify relevant keywords. 
• Choose manual bidding. Monitor your bids and adjust them based on performance data. Increase bids on keywords with high conversion rates and decrease bids on keywords with low conversion rates. This will improve conversions while keeping the advertising cost the same.
• Use product targeting to target specific products that are similar to yours. This can help increase the visibility of your products and drive sales.
• Organize your campaigns by product category or type to make it easier to track performance and optimize bids.
• Create compelling ad copies and use high-quality images to showcase your products. Make sure your ads are relevant to the keywords and products being targeted.
• Monitor your campaigns regularly and make adjustments as needed to improve performance. Use Amazon’s data and analytics to identify areas for improvement and make changes accordingly.

Sponsored Brands

Sponsored Brands is an Amazon advertising format that allows sellers and vendors to promote their brand and products at the top of Amazon search results. These ads feature a custom headline, a brand logo, and multiple products, and are denoted by the “Sponsored” label.

1. Sponsored Brands can help increase brand awareness and visibility on the Amazon platform. By featuring a brand logo and custom headline, advertisers can showcase their brand and differentiate themselves from competitors.
2. They also help increase product visibility by featuring multiple products in the ad. This allows advertisers to promote a range of products within a brand and increases the likelihood of customers clicking on the ad.
3. This format often has higher click-through rates (CTR) than other Amazon ad formats. This is due to their prominent placement at the top of search results and their ability to showcase multiple products.
4. Amazon provides advertisers with a range of targeting options for Sponsored Brands, including keyword targeting, product targeting, and audience targeting. This allows advertisers to reach specific audiences and increase the relevance of their ads.
5. There are also detailed performance metrics for Sponsored Brands, including impressions, clicks, and sales. This allows advertisers to track their performance and optimize their campaigns based on data-driven insights.

Nature’s Path, one of North America’s popular organic breakfast and snack food brands, has been selling in the Amazon store since 2007. To increase brand awareness and loyalty to the company, they used animated video creatives and lifestyle photography of their top products and integrated them with their Sponsored Brands campaigns. With bidding strategies and expanding their product category targeting, Nature’s Path reached a 2x increase in click-through rate (CTR), a 1.5x increase in ROAS, and a 50% decrease in CPC.

Here are some best practices to optimize Sponsored Brands campaigns:

• Use a custom headline that accurately reflects your brand and product offerings. This can help increase brand awareness and make your ad more relevant to customers.
• Use high-quality imagery and product descriptions to showcase your products and make your ad visually appealing. Make sure your ad creative is consistent with your brand messaging and reflects the value proposition of your products.
• Use relevant targeting options, such as keyword targeting, product targeting, and audience targeting, to reach specific audiences and increase the relevance of your ads. Monitor your targeting options regularly and adjust them as needed based on performance data.
• Monitor your bids and adjust them based on performance data. Increase bids on keywords and products with high conversion rates and decrease bids on those with low conversion rates.
• Ensure that the landing page for your ad is optimized for conversions. Make sure it is relevant to the ad creative and provides a seamless user experience. Consider creating a custom landing page for best results.
• Monitor your campaigns regularly and make adjustments as needed to improve performance. Use Amazon’s data and analytics to identify areas for improvement and make changes accordingly.

Sponsored Display Ads

Sponsored Display Ads is a format that allows advertisers to display ads to potential customers both on and off the Amazon platform. These ads can be targeted to reach customers who have previously interacted with a brand or shown interest in similar products or categories.

1. Sponsored Display Ads allow targeting customers off the Amazon platform. This can help advertisers to reach potential customers who may not be actively searching for products on Amazon but have shown interest in similar products or categories elsewhere on the internet.
2. Sponsored Display Ads also allow for remarketing campaigns, which target customers who have previously interacted with a brand or its products on Amazon or off. This can help increase the relevance of the ads and improve the likelihood of conversion.
3. They offer customizable ad creative options, including custom headlines, product images, and brand logos. This allows advertisers to showcase their products and brand in a way that is consistent with their messaging and value proposition.
4. They also offer advanced targeting options, including product targeting, interest targeting, and audience targeting. This allows advertisers to reach specific audiences and increase the relevance of their ads.
5. Sponsored Display Ads are often more cost-effective than other Amazon advertising formats. This is due to their lower cost-per-click (CPC) and the ability to reach potential customers off the Amazon platform, which can lead to increased brand awareness and customer acquisition.

In 2019, Bagail, the travel and home accessories company, decided to start using Amazon Ads to help improve the visibility of their best-selling products and increase the discoverability of newly released items. Using the “optimize for reach” bidding option for Sponsored Display with other Amazon Ads solutions, from 2021 to 2022 the company doubled the discoverability of its brand name and products. Their ad-attributed sales for Sponsored Display campaigns have grown by 100%.

Here are some best practices to optimize Sponsored Display Ads campaigns:

• Use relevant targeting options, such as remarketing, product targeting, interest targeting, and audience targeting, to reach specific audiences and increase the relevance of your ads. Monitor them regularly and adjust them as needed based on performance data.
• Don’t forget about ad creativity to showcase your products and make your ad visually appealing. Make sure it’s consistent with your brand messaging and reflects the value proposition of your products.
• Ensure that the landing page for your ad is optimized for conversions, relevant to the ad creative, and provides a seamless user experience.
• Monitor your bids: increase bids on targeting options with high conversion rates and decrease bids on those with low conversion rates.
• Monitor your campaigns regularly and make adjustments as needed to improve performance. Amazon’s data and analytics can help you with that. 
• A/B testing: test different ad creatives, targeting options, and bidding strategies to identify what works best for your audience and optimize your campaigns accordingly.

Video Ads

Video Ads on Amazon are an advertising format that allows advertisers to showcase their products or services through engaging video content. This type of advertisement appears on Amazon product detail pages, mobile app placements, Fire TV, and others.

1. Video Ads offer a highly engaging format that can capture the attention of potential customers. They allow advertisers to showcase their products in action and provide a more immersive experience for the viewer.
2. Video Ads increase conversion rates and drive sales. They provide a more interactive and persuasive format that can help customers make purchase decisions.
3. This format can also help improve brand awareness by creating memorable and engaging content that resonates with viewers, builds brand recognition, and increases customer loyalty.
4. They offer a variety of targeting options, including interest-based targeting and retargeting. This allows advertisers to reach specific audiences and increase the relevance of their ads.
5. Amazon provides advanced analytics for Video Ads, allowing advertisers to track metrics such as views, engagement rates, and conversion rates. This data can be used to optimize campaigns and improve performance over time.

Bombay Shaving Company, the fast-growing personal care and grooming solutions brand, is a great example of Video ads format success. From June to October 2021, the company ran three one-day campaigns on Amazon Fire TV. As a result, the company achieved a CTR of 0.58%, which was more than 65% higher than the maximum CTR in the consumables category. The brand was able to reach relevant audiences at an optimal cost on Fire TV which was 42% lower than the cost per click for other streaming services.

Here are some tips for creating good Video Ads on Amazon:

• Create short videos that are engaging, informative, and entertaining. Keep the video length between 15 to 30 seconds to hold the viewer’s attention and deliver your message effectively.
• Showcase your products prominently in the video to create product awareness and drive sales. Use visuals that clearly show the product’s features, benefits, and value proposition.
• Use high-quality video and audio to create a professional and polished look. Ensure that the video is clear, crisp, and visually appealing. Poor quality video or audio can reduce the viewer’s engagement and negatively impact the campaign’s performance.
• Test different creative elements such as the video format, messaging, visuals, and call-to-actions. Use A/B testing to identify the most effective creative elements and optimize your campaigns accordingly.
• Use interest-based targeting and custom audiences to reach your target audience effectively. Use Amazon’s audience data to target shoppers who are interested in similar products or brands.
• Use performance data such as views, clicks, and conversions to optimize your campaigns. Adjust your targeting, bidding, and creativity based on this data to improve performance and ROI.
• Use Amazon Attribution to measure the impact of your video ad campaigns on sales and conversions across Amazon’s entire ecosystem. This will help you optimize your campaigns based on actual sales data.

Amazon DSP

Amazon DSP (Demand-Side Platform) is a programmatic advertising platform that allows advertisers to reach audiences both on and off Amazon through real-time bidding. Here are some benefits of using Amazon DSP for programmatic advertising:

1. Amazon DSP allows advertisers to reach a wide range of audiences, both on and off of Amazon. Advertisers can target specific audiences based on factors such as demographics, interests, and behaviors.
2. Amazon DSP offers a high degree of flexibility, allowing advertisers to run campaigns across a range of formats, including display, video, and audio. Advertisers can also choose to run campaigns programmatically, meaning that the ads are purchased and placed automatically using algorithms.
3. This format uses advanced algorithms and machine learning to optimize campaigns in real time. This means that the platform can automatically adjust bids and targeting to ensure that ads are served to the right audiences at the right time.
4. Amazon DSP provides detailed reporting and analytics, allowing advertisers to track the performance of their campaigns and make data-driven decisions. The platform also offers integration with third-party measurement tools, making it easy to track campaign performance across channels.
5. Amazon DSP prioritizes brand safety, ensuring that ads are placed in appropriate environments and avoiding placements on low-quality or unsafe sites.

One of the best examples of a successful campaign is the one for Sulwhasoo, a South Korean beauty brand that has been available in the Amazon US store since 2022. Sulwhasoo wanted to grow Streaming TV and display ads impressions, month-over-month purchase rate, purchases coming from new-to-brand (NTB) customers, and increase overall US sales. Using Amazon DSP insights and measurement tools, such as audience insights reports, overlap reports, and others, the company reached all its goals in less than 2 months. Streaming TV impressions exceeded Sulwhasoo’s goal by 30%. NTB purchases among US audiences scaled with a 21% month-over-month increase in May 2022, 111% in June, then hitting 258% in July. Sulwhasoo’s overall sales in the Amazon US store increased 174% between the first and the second quarter of 2022.

Here are some tips to make your Amazon DSP ads successful:

• Use Brand Logos & Headlines to make your ads recognizable as your brand so consumers know exactly who and what they are getting:
• Use Responsive E-Commerce Ads – it’s a new creative type that allows you to advertise multiple ASINs (Amazon Standard Identification Number) in a single creative. It automatically builds out all of the sizes for each ASIN, saving you a lot of time and energy;
• Use audience insights to help you gauge the relevancy of an audience for your brand and determine the kind of reach you can achieve;
• Use overlap reports to take a specific audience you are already using successfully, search it, and receive 30 audiences that fall into the same consumer profiles;
• Use Amazon Recommendations to optimize campaigns.

Conclusion

Amazon Ads open up wide opportunities for sellers. With various ad formats, you can increase brand awareness, product visibility, brand loyalty, promote customer engagement, and increase your sales.

This is evidenced by a lot of cases of successful advertising on Amazon, as you can see from the examples in this article. Each of the advertising formats has its advantages and benefits. Knowing all of them and skillfully combining formats for building an advertising strategy, you will be able to significantly improve performance and achieve the desired results. 

So don’t hesitate to give these ad formats a try and see the difference they can make in your Amazon advertising campaigns.

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