According to Amazon, 69% of customer searches on Amazon don’t include a brand name. That means that most shoppers are still in the consideration phase and have not yet decided which product to buy. Of the shoppers that do use branded search terms, 25% do so for multiple brands while shopping, indicating that they have narrowed their list but are still in the consideration phase.
Amazon advertising is a powerful tool for reaching and winning these shoppers. Amazon advertising includes multiple ad types, and each serves a purpose in your Amazon marketing strategy. In this post, we’re going to focus on just two: Sponsored Brand Ads and Sponsored Brand Videos.
Sponsored Brand Ads are cost-per-click (CPC) banner ads that help generate brand awareness and heighten engagement. Sponsored Brand Ads appear at the top, middle, and bottom of the search results page. Like Sponsored Products, Sponsored Brands appear for seller-selected keywords.
While Sponsored Product Ads are known for being the highest converting ad type on Amazon, Kaspien has seen very promising results from Sponsored Brand Ads. On average, our Sponsored Brand Ads have a 14% conversion rate and a 7:1 return on ad spend (ROAS).
If Sponsored Brand Ads yield such strong results, why do Sponsored Product Ads still get the most attention? Even at Kaspien, we regularly recommend Sponsored Product Ads first, Sponsored Brand Ads second (though Sponsored Display Ads are also proving incredibly potent after a major update in late 2021).
It comes down to difficulty. Every search engine results page (SERP) offers multiple ad placements for Sponsored Product Ads, but only one Sponsored Brand Ad can appear at the top of the SERP. When Sponsored Brand Ads are the first thing that shoppers see on the SERP, and there’s only one placement available, you can see how this ad type becomes highly competitive.
Given the challenge and the potential, what are the best ways to use Sponsored Brand Ads?
Amazon’s algorithm favors products with high conversion rates for Sponsored Brand Ad placements. That fact, combined with the intense competitiveness of the ad type, means you’ll see the greatest success when you run Sponsored Brand Ads for products with low rank and high sales velocity.
What if you are launching a new product or expanding your brand to Amazon? Should you never use a Sponsored Brand Ad?
Not necessarily; it depends on your goals. If you want to drive conversions, you should promote your best performing products. In this case, you should bid on branded-keywords. This will place your ad in front of shoppers already interested in your brand and help pull them over the finish line.
If your goal is to build awareness for your brand or product, then Sponsored Brand Ads can certainly support, but they’ll do so with a lower conversion rate. In this instance, you should bid on non-branded keywords. This will place your ad in front of shoppers still in the consideration phase.
If launching a new product, pair it with two established products in a Sponsored Brand Ad to help it generate traction quicker. The established products will help the banner ad win placements, creating more visibility for the new product.
Generally, we recommend bidding on branded keywords because they have a higher ROAS. This is especially true in categories that have higher rates of brand loyal shoppers, such as the Pet Supplies category or Baby category.
In these categories, shoppers highly value brands that they deem trustworthy. Because the product will be used by a loved one and safety is paramount, shoppers research their options. Once they find a brand that they like, they can skip the research step and return to the trusted brand. When this happens, shoppers use branded search terms, and that’s where your Sponsored Brand Ads can step in to meet them.
Because Sponsored Brand Ads display three products, you can use them to display the breadth of your product offerings. This strategy can be particularly helpful in categories where shoppers expect to be able to purchase multiple product types from one brand, such as Electronics or Baby.
In the same vein as above, we also recommend pointing your Sponsored Brand Ads to your Amazon brand store. This enables you to show all your product offerings in a branded digital storefront, removed from the competition of the SERP.
Similar to Sponsored Brand Ads, Sponsored Brand Videos are CPC ads on Amazon that generate brand awareness and support conversions. These ads appear on the SERP for desktop and mobile. According to a survey by Wyzowl, 68% of consumers prefer to learn about products or services through video.
At Kaspien, we’ve seen very promising results from Sponsored Brand Videos, with our ads delivering an average advertising cost of sale (ACOS) of 9%. Amazon also reports that some advertisers see 55% lower CPC’s for Sponsored Brand Videos compared to Sponsored Brand Ads, which can be attributed to lower competition for the ad type.
Currently, Sponsored Brand Videos can direct shoppers only to the product page, but Amazon notes that advertisers will be able to point shoppers to Brand Stores soon.
Sponsored Brand Video strategy differs in several ways from Sponsored Brand Ads. You should still pick a top performing product if you want the highest ROAS, but if you have the budget, you can also use Sponsored Brand Videos to catapult new products to success.
Sponsored Brand Videos add clarity, excitement, and a wow factor to products, which makes them an ideal marketing lever for a competitive niche.
As you can see in the screenshot above, the coupon tag is visible in Sponsored Brand Video ads. Pairing sponsored ads with Amazon coupons is a great way to increase visibility and add an even greater incentive to click!
Amazon notes that CPC can be significantly lower for Sponsored Brand Videos compared to Sponsored Brand Ads. As such, you can afford to focus on building brand awareness, bidding on non-branded keywords to widen your audience.
If you go through the time and money needed to create a high-quality video, get as much mileage out of it as you can. Reuse the video in your product listing, social media, Google advertising (including YouTube), and your direct website.
If you’re asking yourself, “What video should I pick?” you’re not alone! Best practices for video selection may differ by category, but generally, videos should be informational, promote key product features, establish an emotional appeal, and be simple enough that the main ideas can be understood without audio. We also highly suggest including text overlay, enabling you to fully engage shoppers even with their device on mute.
In the below example from Arava, a girl uses their tear stain wipes on her own eyes before taking a separate wipe to use on her dog. This demonstrates that the product is safe and gentle enough to trust on your pet’s skin. Best yet, viewers can understand this product feature without turning on audio.
Amazon recommends the following do’s and don’ts for Sponsored Brand Videos:
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