Advertising

Winning On Amazon - The 4 Parts Of The Iceberg

Bobsled Marketing is a full channel Amazon agency. What does this mean exactly?

Unsurprisingly, this is a question we hear a lot. Amazon is becoming increasingly important for thousands of brands and there is a lot of mystery surrounding what it takes to effectively master the channel.

We thought it would be useful to break down our approach to Amazon management aka “The 4 Parts Of The Iceberg”.

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Our Credentials

Before we dive in, here’s a little background about Bobsled:

  • Established in 2015 by Australian entrepreneur and former commercial banker Kiri Masters
  • Headquartered in New York City
  • As of July 2018, we manage the Amazon channel for 55+ brands on Amazon North America, Europe and Australia
  • Our clients include third-party sellers (Seller Central), vendors (Vendor Central) and “hybrid” sellers (Seller Central & Vendor Central)
  • We represent branded manufacturers and retailer private labels across all of Amazon’s product categories
  • Proud member of Amazon’s official Solution Provider Network
  • Accredited agency for the Amazon Media Group  (AMG) display ad network
  • Official Amazon content contributor on Forbes.com

Every Amazon account is unique, and our extensive experience has taught us that there isn’t a one-size-fits-all approach.

However, there are specific areas of Amazon management that every seller or vendor needs to be on top of. It doesn’t matter if you’re selling makeup, jewelry or toys; you will simply not succeed on Amazon if you don’t manage certain aspects of the account efficiently.

 

The 4 Parts Of The Iceberg

A picture paints a thousand words, so without further adieu, here’s a visual representation of how we view Amazon account management: 

As you can see, the iceberg is broken down into four different sections; Operations, Brand Protection & Customer Service, Organic Marketing and Paid Advertising.

In this post we’re going to break down exactly how we manage each chunk.

 

 

Part 1 of 4: Operations

Day-to-day operational management forms the backbone of every Amazon presence. This section sits at the very bottom of our iceberg as the tasks involved are typically behind-the-scenes. But such tasks are incredibly vital as they keep the entire account afloat.

At Bobsled we define Operations as maintaining excellent Seller and/or Vendor metrics. This is perhaps the easiest part of Amazon account management as Amazon will help you track all critical metrics, and if there’s an issue you’ll receive a performance alert.


Third-party sellers (Seller Central) have different operational metrics compared to brands selling to Amazon in a wholesale capacity (Vendor Central). Here’s a brief checklist of the main operational metrics we look for on Seller and Vendor:
 

Vendor Central

  • Incomplete or pending shipments
  • Product Submissions page to track approval status of new products
  • Problem Receive Rate %
  • Vendor Operational Performance alerts for any issues
  • Chargebacks and vendor returns
  • Case Log, assess the status of any existing disputes
  • Purchase Order submissions and confirmed quantities
  • Customer Packaging Ease Of Opening and Protection Ratings
  • Invoicing issues


Seller Central

  • Performance notifications
  • Respond to Buyer Messages
  • Check Account Health status
  • Inventory review
  • Case log updates
  • Incoming-FBA shipments status
  • Stranded inventory
  • Unfulfillable units
  • Catalog review
  • FBA fees
  • Inventory management
     

It’s important to note that some tasks needed to be completed daily, whereas others should happen on a weekly or monthly basis. For example, Sellers should look for Performance Notifications every day because if you miss an important notification, such as an A-Z Claim, it could lead to an account suspension.
 

Inventory Is Key

The greatest challenge from an operational point of view is typically inventory management. Ensuring that you have Prime-eligible inventory available at all times is a simple and effective way to grow Amazon revenue.

Sellers have more control over their inventory levels compared to Vendors. This is because Sellers can decide exactly how much inventory to make available on Amazon, whereas Vendor inventory levels are determined by Amazon’s wholesale PO’s (Purchase Orders).

Shoppers love the convenience of Amazon and if your product is unavailable they will likely go with a competitor or an unauthorized third-party seller. Analyzing YOY data and closely tracking sales velocity are two things every brand should be doing to help accurately project required inventory levels and avoid costly stock-out situations.

Here is more information about Bobsled’s recommended inventory management strategies.


Part 2 of 4: Brand Protection & Customer Service

Due to Amazon’s growing market share in the eCommerce space, protecting your brand and providing exemplary customer service is of extreme importance. Once again, a lot of the work is “back-end” heavy, but completely necessary due to the dog-eat-dog manner in which Amazon functions as a marketplace.

We define brand protection and customer service on Amazon as:


Controlling Buy Box Threats

For every unique product on Amazon there is only one product listing. This means that if your product is sold by multiple sellers, they will all be competing for the same Buy Box.


Every brand has a slightly different policy when it comes to other parties selling their products on Amazon. Here are the three most common scenarios:
 

  • Scenario 1 - brand has complete control over distribution, and no other parties sell their product line across any other channels. Such brands generally don’t have to worry about other parties trying to win their Buy Box on Amazon.

  • Scenario 2 - brand has select authorized resellers who are allowed to sell their product line on Amazon. Such brands need to ensure the authorized resellers respect the MAP agreement on Amazon to preserve pricing integrity across all online channels. It should also be noted that authorized resellers may on-sell large quantities of inventory to other parties who may end up becoming unauthorized Amazon sellers (unless there’s a specific clause in the agreement preventing the authorized reseller from engaging in this activity).

  • Scenario 3 - brand sells to multiple other parties, and has no authorized Amazon resellers. As a result a brand in this situation will likely have to contend with a huge number of unauthorized resellers competing for the Buy Box on the Amazon marketplace.
     

In our experience, prevention is always better than a cure when it comes to dealing with Buy Box threats. Carefully vetting wholesale partners and creating watertight agreements can save you from numerous headaches further down the line.

This issue unfortunately impacts both Sellers and Vendors. Amazon wants wide selection and fierce price competition on their marketplace so it’s up to the brand owner to control the Buy Box on each product listing.
 

Responding To Customer Questions & Product Reviews
Promptly With Helpful Information

Failing to respond directly to Customer Questions and Product Reviews can have huge ramifications for your brand.

On your own ecommerce website you completely control the shopping experience. Amazon is a little different. You control the product listing content for your own branded products but customers can leave feedback right on the page. If this feedback is negative or inaccurate it can impact conversion and revenue negatively.

For Bobsled clients we respond directly to this type of feedback in order to preserve the integrity of product listings under our management.

 

Part 3 of 4: Organic Marketing

Many brands have great content but it’s simply not optimized for the Amazon marketplace. Organic marketing is about giving both the A9 algorithm and the Amazon shoppers all the right information about your brand and product line.
 

Ensure That All Your Product Information Is Correct

Often times product listings on Amazon have been “hijacked” by other third-party sellers. Or perhaps there are counterfeiters selling fake versions of your product line. There is often misleading information floating around on Amazon, particularly for brands with large catalogs that sell across multiple channels.

It is your responsibility as the brand owner to review the catalog and update any false information.


Are Your Product Listings Designed To Convert?

The first step is starting with the framework of the product listing; back-end search terms and metadata, product title, images, bullet points and product description.

Secondly, Sellers and Vendors should be considering boosting the quality of the product listings with EBC (Enhanced Brand Content) and A+ Pages. These enhancement features offer a great way to differentiate your products from competitor offerings.

Finally, brands should be considering ways in which they can offer more value to shoppers with Promotions. Simple offers include Percentage Off, Free Shipping (if you always Merchant-fulfill) and Buy One Get One promotions. If you want to get more advanced, Product Bundles and the Subscribe & Save program might be ways in which you could edge out the competition. We’ve published a blog post on Amazon Promotions, you can check it out here.


Part 4 of 4: Paid Advertising

In our iceberg graphic we put Paid Advertising at the very top. Once you’ve built an account with solid foundations, you can use PPC advertising to drive more awareness to your brand and product catalog.
 

Do I Really Need To Advertise My Amazon Products?

Every Amazon marketplace is becoming more and more crowded with each passing month. Therefore, it becomes more of a challenge to rank organically (even for established brands) due to the increased competition across every product category.

By utilizing Amazon’s paid advertising tools a brand can rent pieces of prime real estate across the ecosystem in an attempt to gain more impressions, clicks and conversions. By not investing in PPC you are giving competitors an opportunity to eat into your market share.
 

How Do I Allocate Spend & Track Performance?

There is no simple answer to this question due to the fact that each Amazon account varies so wildly. Some factors that should impact your paid advertising strategy include; Amazon fees, inventory levels, seasonal trends, state of listing optimization and competitiveness of your product category.
 

It Starts (And Ends) With Profit Margin

At Bobsled, our starting point for ascertaining the recommended PPC budget is always profit margin on a SKU level. Amazon is a great channel for exposure, but if you’re aren’t turning a profit then what’s the point?

Once we have a ballpark idea of what the ad spend level should be, our advertising team builds PPC campaigns and begins to track performance. Our ultimate goal is to reach the point of diminishing returns across the catalog. This means spending just the right amount on advertising to see the most optimal results overall.

Check out our blog post “How Much To Spend On Amazon PPC In 2018”.

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Conclusion: When We Say Full Channel, We Really Mean It

Bobsled’s full channel Amazon management service is a complete package. In a nutshell; our clients ship inventory, and we handle everything Amazon related on their behalf.

This service overview is just the “tip of the iceberg”. To learn more about how we can help your brand scale on Amazon please schedule an appointment with a Bobsled representative below.

How Much to Spend on Amazon PPC in 2018

The verdict is in; Amazon PPC advertising is something that every brand selling on Amazon should be taking advantage of in 2018 (and beyond). But, this isn’t exactly a new revelation. In fact, we already wrote about it here, and here.

So why write about it again? In the world of ecommerce, or digital advertising technology, the world changes very quickly, and 6 months is a long time. If you created your Amazon PPC campaign 6 months ago and haven’t touched it since, now is the time to panic. Your campaign is probably outdated and under-optimized, but keep that panic in check for a minute while I guide you through the here and now of Amazon PPC in 2018. 

So how ARE your campaigns doing? Do you know if they are meeting or exceeding industry averages? How do you tell if they are underperforming? Let’s take a look.

 

Know Your Costs and Margins Before Spending a Penny

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In order to properly optimize a PPC campaign you’ll need to determine your profit margins. Without these numbers you could over-spend on PPC without really realizing it until you take a look at your long term balance sheets. So, start looking at those balance sheets now to determine your unique formula for a successful campaign. 

One of our previous posts discusses 4 different methods for determining your ideal ad spend. If you’re new to this territory, or if you just feel like your methods aren’t working for you, I recommend giving the post a read. Additionally, if you are on SC and taking advantage of FBA, Amazon has a great revenue calculator that will do a lot of the legwork for you.

There’s more to it than averages though. Each brand still needs to consider the competitiveness of their category when determining their ideal ACOS and share of overall sales driven by PPC. Add that to the calculations you did to determine your profit margin and you start to get somewhere.

 

Know Your Industry and Product

The 25/25 rule and other methods for determining ad spend are great in theory, and often even in practice, but they can sometimes fail to factor in the nuances of various industries and your unique product. 

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If you’re regularly over-spending on PPC you could be in a highly competitive category, up against some big brands that don’t mind dropping whatever it takes to get the clicks.

More detailed and niche ads and keywords are generally better than the wider search terms. For example, when you search for “Mascara” on Amazon.com it returns over 700 listings for this single and very identifiable item. Change your search to “Waterproof Mascara” and suddenly the listings number drops down to 270. If your product has a unique identifier you can take advantage of (that is still an accurate product description) you may be able to save yourself some cash on bid prices and reach a more targeted audience.

However, if you take a look at your advertising reports and see that the majority of your sales are coming from the most expensive keywords it wouldn’t be a great idea to abandon those any day soon. Instead, try making small changes to your campaign in order to make your ads and keywords as relevant as possible.
 

Learn from History

Learning from history is always a good thing, but in order to properly do this we need to be paying attention. Amazon PPC campaigns can be really easy to set up and walk away from, but while it’s possible to do that and still gain sales through PPC, it’s definitely not ideal.

If you’ve been running Amazon PPC campaigns for a little while now it’s worth your time to compile and analyze reports. These reports can then help you shape your new campaigns or optimize your existing ones.

For brands that have been running Amazon PPC campaigns for at least a year it’s beneficial to analyze the entire previous calendar year to help you get the most out of your PPC campaigns in 2018. Looking at the entire year will help you to see seasonal trends or correlate bad performance to a specific ad or product that you were testing over a period of time.When you look at these reports in depth you can better optimize your campaigns from month to month.

Unfortunately, there are some limitations to Amazon’s reporting, where you can only look back at 60 days at a time, so if you were inconsistent in downloading reports in 2017 you should take this opportunity to make sure you have a plan in place to regularly download reports in 2018.

 

How long should I wait to see results?

Changes in your PPC campaigns won’t work their magic overnight. You need to take into account the habits of shoppers and how buying trends will change over time. 

If you sell outerwear you’re going to see an increase in clicks during an unseasonal snow storm, but those clicks will likely drop off again after the immediate need passes. If you just look at data from that week you won’t get a good overall picture of how the campaign performs outside of a buying trend.
 

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You want to know how your campaigns perform over a larger portion of time, but you don’t want to wait forever before making changes if you feel it could be optimized further. I think that 4-6 weeks is a good amount of time to allow a campaign to run before analyzing results and making changes.
 

Are there better ways to spend my money?

If you are happy with your ad spend and results, but have a little more budget to allocate for 2018, maybe just hold onto it for a little while longer. Amazon has been investing a lot back into their seller platforms and new entities like Amazon Media Group, so in all likelihood, we can expect to see them bring more advertising offerings to Amazon brands in the near future.

If 2018 is the year your brand is looking to become more profitable on Amazon, Bobsled Marketing is here to help you optimize your Amazon PPC campaigns. Contact us to discuss the options.

Headline Search Ads: 4 Conversion-Boosting Strategies

Carving out opportunities for exposure is a highly necessary step for Amazon sellers. After all, brands are often competing against dozens (if not hundreds) of sellers offering similar (or even the same) products. As an Amazon seller you’re likely looking for new ways to convert Amazon shoppers, and Headline Search Ads is one of the methods you should consider.

So how do you stand out from the competition? Obviously you need to present a quality product with as much emphasis as possible on the benefits of the product, but once you’ve nailed that down you need to tackle the issue of being seen as much as possible, in the right place, at the right time. 

One of the ways you can stand out is by using Headline Search Ads. These ads appear above the search results, displayed based on keyword relevance. These ads are top of the funnel advertisements geared toward converting shoppers, so if your brand wants a full funnel they are a great opportunity to get that attention of more potential buyers.

There is plenty of research that points to search advertising as being a highly effective method towards increasing conversions. Research from Forrester states that, “Amazon in particular is increasingly demonstrating its value as a search engine. Consumers in the US and Europe are much more likely to discover the brand of a recent purchase from Amazon rather than from a traditional online search engine.”

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Understanding Amazon Headline Search Ads

So what exactly are we talking about when we refer to Headline Search ads? As previously mentioned, these ads appear above search results using keyword targeting. Up to three different products can appear in a headline banner, depending on the availability of relevant ads.

Headline Search ads can also be customized by the brand. They can be optimized with engaging headlines and links to unique landing pages; both elements that will help with discovery and getting shoppers into your funnel. Some of the biggest benefits brands can experience by using Headline Search Ads are:

  • Prime Real Estate: Show up first on target keywords.
  • Feature Multiple Products: You can advertise up to 3 ASINs at one time.
  • Upsell: Grouping similar or complementary products can result in sales of multiple products when a consumer was only searching for one.
  • Custom Brand Experience: Provide shoppers with a unique experience by customizing headlines and landing pages.

As you can see, Headline Search Ads come with a wide array of benefits and are a great way to convert shoppers who are already in the market for the type of products your brand sells. Think of it as having a stand-out display of your cleaning products to greet shoppers in the aisle of their supermarket where they came specifically looking for cleaning products.

 

Who should use Headline Search Ads?

Most brands can benefit from the use of Headline Search Ads. The only time we would suggest not using them is if a brand carries less than 3 products, but this is a rare occurrence. 

Even if a brand has ads on other platforms, such as Google or Facebook, Amazon Headline Search Ads have significant benefits due to the shopper intent. Just consider the fact that the shopper is already on Amazon searching for a specific type of product, and if your product is a match you are able to place it in their path and shorten the time to conversion.

These ads are quite different from banners on social platforms or search engines because of the shopper’s intent. While you might use a social platform to create awareness for your brand, Amazon Headline Search Ads have a much shorter path to conversion.

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4 Conversion-Boosting Strategies for Headline Search Ads

So now you know why you should be using Headline Search Ads, but you may be wondering how you can make the most of your ad dollars spent on this platform. Here are 4 ways you can optimize your ads to convert shoppers:
 

1. Speak Directly to Your Audience - Determining and addressing your target shoppers’ needs is step 1. Do you know what your number one value proposition is? Now you need to write effective ad copy that points out that value proposition and addresses what the shopper is searching for. 

Try creating formulas and using power words to influence clicks, and always keep in mind the natural language shoppers use to search for your product. For example:

  • Our (product) is (multiple)x(desired outcome) - Our Batteries Last 5x Longer
  • You (target user) will be (adjective) (desired Outcome) - You will be amazed by how clean your house smells.
     

2. Find the Best Keywords - A large part of why Headline Search Ads are so effective is that they appear above the listings for a product the shopper is searching for. It doesn’t get more relevant than this, but you need to make sure you are using the right keywords when you create your ads to make sure you are reaching the right audience.

You can find helpful keyword data in the Search Term Report (located under Advertising Reports) to understand the natural language of your customers and to group effective search terms with associated products. Amazon will even present you with a list of suggested keywords as you start entering your own, complete with a traffic identifier next to each one. This identifier will let you know if that keyword receives high, medium, or low traffic. Naturally, the highest traffic keywords will have the highest bids, so selecting keywords that are more niche with lower traffic can be a great strategy for attaining lower bid prices.

      Image Source: amazon.com

     Image Source: amazon.com


3. Create Highly Relevant Campaigns - Relevance is a key component for successful Headline Search Ads. If you sell dish towels this isn’t the platform for converting people looking to buy paper towels. In order to optimize your ads you should create tightly knit ad groups that don’t allow for ambiguity. This is where your unique value proposition comes in. Make sure shoppers know why your product is different (and better) than the other options available.

For example: a gourmet food brand conducted a headline test with branded vs. non-branded headlines. They ran a campaign with the headline just “Grilling Spices Set” vs “{Brand} Grilling Spices”. In this case, having their brand name in the headline had a 2x increase in click-through rate, showing that shoppers were searching for their particular brand.


4. Test and Optimize Continuously - Amazon allows you to customize your Headline Search Ads, so you should take advantage of this by testing multiple campaigns simultaneously and periodically changing ad images, headlines, and the ASIN order or mix. Amazon suggests changing only one variable at a time and running it for a minimum of two weeks to determine its effectiveness before making additional changes.

For example: a personal care brand conducted an image test by creating ads with their logo vs. product image. On the ads where they used their brand logo there was a relatively low volume of sales & traffic with an $8 Spend resulting in $160 Sales. When they used a product image they received a higher volume of traffic and more engaged customers, resulting in $507 Sales from $44 in spend.

 Image Source: amazon.com

Image Source: amazon.com

Ready to get started?

Now that you know the benefits of Headline Search Ads and how to optimize them to your biggest advantage as an Amazon Brand, are you ready to create your first campaign? If you want to grow you Amazon funnel, and therefore, Amazon sales, we highly recommend implementing this strategy.

With almost 40% of online spending happening through Amazon, it’s a platform that your brand can’t afford to leave unoptimized. Headline Search Ads are a great way you can optimize your conversions on the Amazon platform.

If you’re looking for help with Headline Search Ads, and Amazon PPC in general, request a consultation with our expert team and see how Bobsled may be able to help drive more traffic and conversions on your Amazon product listings. 

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