There are three types of lies: lies, damned lies, and statistics.
– Mark Twain
The cardinal sin of Amazon Advertising is to blend the performance of brand advertising and non-brand advertising when making bidding and budgeting decisions. It is absolutely critical for brands to purchase Sponsored Product and Sponsored Brand ads on their own brand terms. However, the value of this activity and one’s ability to influence it is different than the value of buying ads on category searches (e.g. Harry Potter Toys) or competitor searches (e.g. Lincoln Logs). As a Marketer you can make people search for your brand term more often by doing amazing holistic marketing (tv ads, display ads, social campaigns, PR etc..) it’s much harder to get people to search for your category of products. On the other hand, the incremental value of serving an ad to someone already looking for you by brand name is far smaller than that of putting an ad in front of a brand-agnostic shopper searching for your category.
Here’s how we think about this at Teikametrics:
Due to these differences, we always recommend that our clients look at brand, category and competitor search advertising as three completely separate marketing channels – each with different goals and expectations. Unfortunately, it can be incredibly cumbersome to appropriately segregate the performance of brand vs. non-brand vs. competitor searches within Amazon Advertising and to therefore gain the necessary controls over bids and budgets to truly execute this strategy until today.
Brand vs. Non-Brand Advertising on Amazon
The true “incremental” value of branded advertising is far smaller than non-brand advertising – as in many cases users who search for you by brand will find you even in the absence of an ad. However, branded advertising is particularly valuable on Amazon as it enables you to merchandise new product to loyal shoppers, pin highly rated products with your best images to the top of the search results and reinforce your brand message/promise at a critical point in the consumer journey. Brand advertising on Amazon is essentially a necessary evil – you need to do it but the success of doing it should not be attributed to the cost of the search ads – it should be attributed to the cost of other forms of advertising (PR, non-brand search ads, facebook ads, TV ads, Radio, Print, Out of Home etc..). On the other-hand, the incremental value of category search advertising is often higher than even the direct ad-attributed ROI would indicate. Who is a better target for advertising than someone who is turning to the largest eCommerce website in the world and directly asking companies in your category to sell them? These ads are where excellence in advertising execution can really accelerate business growth. As a third segment, the incremental value of competitor search advertising is the absolute highest but the cost can be prohibitive as well. This is a critically important tactic when launching a new product, when you’re focused more on customer acquisition than wallet-share or if you operate in a category where market share is heavily concentrated on the top players and as a result search behavior is heavily branded (e.g. Kleenex).
Teikametrics Flywheel Supports Automated Search Term Filtering
Teikametrics Flywheel now supports automated and intelligent search term filtering to enable friction-less execution of strategies across these important lines. To discuss this powerful new feature with a member of our team click here to start a conversation.