On Episode 1, Tess Barry talks with Apiary Founder, Karen Amundson, about the growing ad platform from Amazon–Amazon Marketing Services (AMS). Hear about top-level performance, testing opportunities, and Apiary’s thoughts on the value of marketing with AMS.
Full transcript (from transcription service)
Tess Barry: 00:00:04 – 00:00:28
Welcome to episode one of The Hive Is Alive: the digital marketing podcasts in the Apiary Digital media, collective. My name is Tess Berry and I will be your podcast host. Each month on the podcast you’ll have a new episode discussing a developing topic relevant to digital marketing. For first episode, I spoke with Karen, CEO and founder of Apiary Digital to discuss a bit about the advertising offering Amazon Marketing Services.
Tess Barry; Karen Amundson: 00:00:32 – 00:01:54
Okay, I am on the phone, with Karen from Apiary Digital media collective and I’m gonna let Karen introduce herself.
Hi, I’m, Karen, I’m the SEO and Founder of Apiary Digital. We are a collective of experience digital marketing professionals and we curate teams for our clients to help them grow customer acquisition.
Today, for our inaugural episode, we’re gonna be talking about Amazon Marketing Services. Karen is actually going to be interviewing me for today’s episode.
If you could just give us a little bit of an overview about AMS and ways you can market on Amazon.
Yeah absolutely. Amazon marketing started around 2012 and there are three different types of Amazon marketing available. The first one is AMG which stands for Amazon Media Group. This is a dedicated team within Amazon and they sell display ads ads through the Amazon advertising platform and also ads that show up on Kindle Fires and things like that. And that’s handled just within Amazon, and it has pretty high minimums to get involved. It’s but typically a bit more like traditional media.
Tess Barry: 00:01:55 – 00:03:40
The second group is Seller Central, and this is a bit smaller. Anyone who’s selling a product on Amazon can buy into these ads, and it’s really just a product display ad. It functions very similar to Google Shopping, pulling from your product feed and then the one that we’re gonna get into today and the one that’s kind of getting a lot of attention and growing recently is Amazon Marketing Services.
So Amazon Marketing Services functions similar to AdWords. This is where you can do queue were targeting category targeting, and these are the ads that show up with in search results with an Amazon and sellers from really huge name brands to pretty small brands are working on their as long as you have a Vendor Central set up and log in with Amazon already just to give us kind of a ballpark. You know in the context of AMS or Amazon Marketing Services. What is kind of a spend of a large client versus a small client in this context, hello thing about Amazon for Amazon Marketing Services. Is that whatever money you have, you seem to be able to spend it with an Amazon with the CPC is, are pretty low on average, so you could have a pretty small daily budget. I’ve seen campaigns for big brands with a hundred dollars a day and they’re still moving product, but you can spend as much as 30K in a month depending on your vertical. It really spans a pretty wide range, I mean and that’s to me actually sounds really low relative to pay per click. Advertising general me think about some of these brands that might be spending thirty KM month sounds like they’ve been there. That might be the same guys. Spending, you know a million dollars a month, an AdWords or something, for example.
Tess Barry: 00:03:41 – 00:04:34
Absolutely and I think that gets into the fact that it’s a growing platform for ads, specifically looking at other platforms like Google and Facebook in their ad revenue. The fact that Amazon is fairly new and starting to grow and they haven’t really marketed much of the fact that they have this advertising capability. I think a lot of brands are starting with test budgets or really minimal, always-on campaigns, and it hasn’t yet become the focus of many brands. Yeah I think that’s an interesting comparison and I guess when you look at where the more mature platforms like AdWords and Facebook, you know where they were when they were in their infancy. Do you see Amazon kind of A., R., M. S. on a similar trajectory of of gross says, or you know, do you think? Ten years from now, we’re going to this is going to be like the next adwords or Facebook or or how would you be thinking about this.
Tess Barry: 00:04:35 – 00:06:28
I think it definitely has the ability to be nearly as big they are really pushing to become kind of the behemoth of you, commerce. They put a lot of their money in focus and customer relationships, so the big drop for brands to use Amazon is that there’s a huge market there’s two hundred and eighty three hundred million active monthly users on Amazon, so the volume is there, but Amazon really hasn’t. Put in the effort like Facebook and Google have developing their ad platform in making it easy for brands to get on the platform, learn how to buy quickly, launched their ads and get understandings of their return at Amazon. Just hasn’t put the effort into that. Yet so I think, depending on the moves they make in the next months as they continue to roll. This out will really make an impact on how much they’re gonna make enough sales well, and that says a lot right there. You know that they haven’t really invested in the the ad platform and the advertiser experience, and you know they haven’t, made it easy for people to spend money on Amazon and yet they’ve already gotten traction in the billions and there’s so much more room for them. To take a slice of the pie, can you talk a little bit more I mean it sounds like. Obviously, the printer milling mean monthly active users is a compelling reason to be there and I’ll be right. Your customers are, but you talk about some of the other benefits of why advertisers would want to use M., S., yeah I. Think the biggest benefit is that it’s pretty bottom of the funnel so in terms of key were targeting. You can have a pretty limited brand keyword list and still see a lot of movement. The brands I’ve worked with doing on off tests to see whether we would have gotten you know. That’s all brand surgeons bottom funnel are the odds really gonna help people purchase? Are they gonna purchase anyway for my listing without having to pay, and we did see that the ads did increase the overall conversions and revenue for some brands that I’ve worked on before.
Tess Barry: 00:06:29 – 00:07:22
So I think that brands are seeing higher returns by advertising. I think it just really comes out of that, but it’s just working for brands and they’re making money and pushing more product yeah and that’s a pretty compelling reason. I I think when I look at you know the MS platform. One thing that stands out to me relative to previous ad platforms that came out you look at something like when Google shopping came out that used to be in a organic search. You know product listing and you don’t even have to pay per click and now we’re we’re in this much more competitive landscape. Where not only is this a a paper click play, but you know then you have to consider. Well then, advertisers are also then, once per someone makes a purchase, they’re paying a small fee to Amazon as well, so they’re getting that kind of up front, paperclip cost and then the back and cost when someone makes a purchase from there Ms onsite. This is a great model for Amazon.
Karen Amundson: 00:07:23 – 00:07:50
Yeah I believe there’s two different ways that you can sell on. Amazon one is a monthly subscription of about $40 for a vendor and the other Amazon charges $1 per product that you sell, so they’re not making much of their money. In terms of making brands be able to sell their products through their platform, I think they’re starting to really realize that you make money through selling ads and they’re trying to catch up with their services.
Tess Barry: 00:07:51 – 00:09:50
The other thing I wanted to mention as a draw for why a brand would purchase out specifically on Amazon is that if you’re not there bidding on your own brand terms, your competitors are probably they’re bidding on your brand terms. One thing about the Amazon platform that makes it difficult for brands and strategist like us to create campaigns is that there’s no key were tool or help that you can get from Amazon that helps you develop your campaign and know what people are searching for. Dave introduced now that, if you put in a queue where they tell you whether it’s low, medium or high volume, but that’s more directional than the stats were used to getting from Google or Facebook in terms of how how? Where money’s going in in who were reaching yeah and that’s a pretty that’s a pretty compelling reason and and I like the point, you brought up about also how labor intensive it is to get you know an am us up and running and and not having those tools in place that search, marketers media planners are typically used to I. Think that’s you know, and then, with the lower cost per click you can expect a lower adds spend. But then your your labor costs are going to be much higher and for me personally, as someone who’s growing marketing services, company and probably to a lot of folks out there who are building their in house marketing teams at cetera. One of the big questions is how much to invest in AMS talents- and you know, what’s the longevity of that, because Amazon and tech company does it seem likely that they’re just going to automate everything and what’s the need now in terms of filling out talent and what do you, what do you see the outlook in a couple of years from now I hope they get an automated pretty quickly, because I have someone who’s been working and search and social advertising. For a few years, I’ve I’ve only seen what’s been available since Google analytics credit crunch, a bunch of numbers super fast and make all these insights available to you pretty quickly to the point you can spend most your time creating strategies and understanding patterns and behaviors, but from my experience with them,.
Tess Barry: 00:09:50 – 00:11:24
Is on the capability of reporting is very, very small. They do not have any trended data charts available. Can’t look at your data from a certain time spans. You can’t just see, for instance, last week’s performance You can’t do any of that within the dashboard. What you have to do is download all the reports individually in order to look at everything and then how’s that date on your own and one of the biggest problems right now is that Amazon urges all of their data after sixty days. So if you have an always on campaign, you have to be continuously downloading your data housing it somewhere, where your excel isn’t constantly crashing In order to have those results to look back on and to optimize your campaigns, it’s also really interesting because they don’t have any automated book. Editing So when you go in, you have to manually change things, so I can see where brands don’t have the bandwidth on their teams for someone and just up and learn this whole platform and it’s a pretty steep barrier to entry yeah. That sounds like a very large labor investment to to get in there I mean it sounds like what you’re talking about no book functionality that to me means you’re. One buy one editing bids on every single key word am I understanding that correctly yeah absolutely and you have to download every single day of data individually It makes it kind of hard to get up to date. Spend results. It’s also interesting because they don’t have campaign type. It’s really just your ad campaign in your products.
Tess Barry: 00:11:24 – 00:13:05
You can’t group those in any larger sense and I know that as a best practice, Amazon ads perform better when you have your campaigns split out as minutely as possible, just breaking down your products into a smaller categories as possible. So you end up with a lot of campaigns and to do all of that manually. It’s it’s a lot of work. So, given the amount of work, let’s talk about the potential upside a little bit more and you know, is it worth it? What kind of performance in return have you seen from clients? In the past the brands I’ve worked on? We saw that Amazon was the best return on ad spend, because those CPC’s are still pretty low. Competition is there, but it’s not as high as somewhere like Google, where people have been on for a long time and because of that high barrier to entry. It also means they are a look somewhat fewer people, betting I think. The other thing, too, is that, especially for your con questing campaigns, it’s also really good impression, value, because there’s not much going on on those pages in terms of other forms of competition. There’s really only like one competitor showing up on a product page, so I think there’s a lot of opportunity there yeah. So some things that stand out to me are yeah exactly that brands looking to do some con questing competitor campaigns, market share takeover and just willing to invest effort in order to get the return versus willing to invest budget to get the return. Can you talk a little bit more about what kind of clients you think are a great fit for AMS and clients, for you would steer them away that maybe they’re not ready or it’s not against it.
Tess Barry: 00:13:06 – 00:14:20
I think clients, especially during holiday seasons or big promotional, pushes when you have a product to sell and say you’re a marketing manager, and you have a use it or lose it budget, and you just have to put it somewhere if you’re, already selling on vendor central setting up a brand campaign and an on brand campaign is a great way to spend your money and still be pretty certain you’re gonna get a good return on it, and then I would steer away clients who very strictly need to know their return like if your manager really needs to know the exact return on your platform, and that’s gonna be something it’s a little bit difficult to get out of Amazon. There was a time where your sales in your reporting included sales for third party resellers, in addition to sales directly from your brand so that made it really difficult to figure out exactly what we were getting back on the platform. Well, it sounds like given some of these limitations. You know advertisers should really be thinking about this, but as truly as a task budget at this point still and have low expectations about the level of visibility and- and you know, kind of knowing directionally that it’s.
Karen Amundson: 00:14:21 – 00:14:27
Performing above targets, but maybe not you know, having really clear specifics.
Tess Barry: 00:14:28 – 00:15:01
Yeah I think so it’s interesting. You don’t really know what’s happening on the platform, but you know that you’re getting a return. That’s pretty much! What I’ve learned on what I’ve worked on so far with the test budgets I’ve handled it sounds that sounds like an exciting adventure. Yeah. Can you speak up? Can you speak to some of the targeting capabilities? Yeah absolutely so, there are three ad units available within Amazon marketing services, R. M., S. and those focus on key word or categories. So.
Tess Barry: 00:15:01 – 00:15:50
The first two ad units are headline search ads, which are the ones that show up right at the top of a search results page. Then there are sponsored product ads and those are the ones that show up for it’s a it’s a product listing in the feed that sponsored and those are keyword based. So you can have a non brand campaign. A brand campaign and a competitor campaign is, is some structures I’ve done before. These third ad unit is a product display ad, and this is targeted based on you can do it actually based on a competitor or a different product, so could be a cross sell or could be a competitor’s product to do some con questing or you can target based on category or interest.
Tess Barry: 00:15:51 – 00:16:43
So you can mark for instance, you can click into the like health and beauty and then go down to the sub category of I, think I, think soap in M. hygiene products or something like that. However, Amazon categorizes different products, you can bet on that. category in the vertical and then your ads will show up on product pages for pages within that category, which is a great way, I think to have a. I would have purchased so you can talk to people and that interest category in a pretty broad way, something kind of parallel to do a little bit more impression based ad serving great. Is there anything else about Amazon and M. S. that you want listeners to know.
Tess Barry: 00:16:43 – 00:17:13
One thing I do want people to know. As we talked a lot about the reporting issues. Amazon has partnered with the platform Kenshoo it’s a place that you can centralize your reporting and do some of that bulk up uploading, an understanding of monitoring your data, and you can do some more quickstep, crunching through their platform, but they have platform minimums and it’s an added cost cool.
Karen Amundson: 00:17:14 – 00:18:03
Thank you for joining us on our first episode to discuss M. S. advertising. We will continue bringing you new episodes on such topics as messenger ads, intelligent tracking and much more. If you have thoughts about Amazon marketing services or if there’s a topic in digital marketing, you’d like to hear discussed on a future episode, please reach out to us. We are on Twitter at if you’re a digital or you can email us at podcast at digital dot com and don’t forget to subscribe to the show on your preferred podcast streaming service. The Hive Is Alive is produced by Apiary Digital media collective. Editing help from Holly Hilton. Our podcast is produced by Karnika Haridoss, myself Tess Barry, and Karen Amundson.
We’ll see you around the water cooler.