At our Transformation of Search Summit earlier this month, we heard a fan-favorite session on Amazon Advertising.
In this session, John Denny (formerly of Bai, currently Cavu Venture Partners) and Luis Navarrate Gomez (LEGO) gave real strategies for how they leveraged both paid and organic search on Amazon to grow their companies.
Bai grew from a small niche brand to the number one beverage on Amazon. They were named “Vendor of the Year” by Amazon in 2015, and they were later sold to Dr Pepper Snapple Bottling Group for $1.7 billion.
Why Amazon Advertising?
In 2012, Amazon surpassed Google as the top destination for US online shoppers, and 55% of consumers turn to Amazon first when searching for products online.
Despite its popularity among consumers, Amazon Advertising is still in its early stages. As John and Luis mention, many buyers liken AMS these days to what it was like running Google search campaigns in 2005.
While there are certain hiccups, Amazon is increasingly being recognized as a viable competitor to Google search. Particularly for ecommerce, many marketers are moving budget from Google to Amazon.
And it seems those investments can pay off: In the spring of 2015, awareness of Bai was around 7%. A year later, it had tripled to 24%. At the beginning of 2018, it had passed 60%. Quite rapid growth for a beverage brand, not typically famed for skyrocket successes.
Bai is a quintessential example of a CPG company diving into digital and search marketing, finding that traditional top dogs in those categories haven’t yet done so, and being able to claim those high-ranking spots.
In this session, John and Luis divulge seven strategies they used on Amazon to get their brands to the top.
Tip #1 Go all in on Amazon Ad programs versus organic search
The paid positions are multiplying. All the “fair organic listings” are not as viewable to consumers as they seem. Many are drowned out — especially on mobile — by new categories like “Top-rated from our brands,” which features private label brands from Amazon.
They quoted an observation that “While [Amazon’s] digital shelf was originally a shelf democracy, it’s becoming more and more an advertocracy where you have to pay to exist and survive.”
Most advertisers are focused on Amazon search. Moving budget to Amazon search from Google. But Amazon’s key ad programs include both search and display (Amazon DSP).
#2: Winning brands on Amazon know organic brand impressions drive success
“Customers who bought this item also bought X” — this spot is a huge deal. Bai was able to appear organically in that position even when consumers searched for their competitors.
A study on earned brand impressions found that layering in display on top of search increased organic brand impressions by 90%.
At this point, they move past the “basic course” and into the expert.
#3: The Pulsing strategy
By using a strategy called pulsing, Bai was able to generate revenue that looked like this:
Essentially, they chose specific days and times of year to increase / pulse their ad spend, and found that the ROI on those days was significantly higher.
They continue with four more expert insights — but we’ll leave those for the full-length video.
Other highlights:
- “A lot of executives hear about ads on Amazon and say, “great, let’s rock and roll! But the reality on Amazon is you can’t rock and roll anywhere if your product is out of stock.”
- Amazon works very differently in different markets. For instance in France, Amazon provides detailed guidelines for how to write product names and descriptions, and restricts their results accordingly
- People trying to game reviews on Amazon, and how Amazon is reacting
- Pros and cons of using vendor vs seller relationships on Amazon
They also were able to get 50% of their subscription revenue to be monthly auto-replenishment orders.
Watch the full session
Whether you currently use Amazon Advertising or are thinking of adding it to your search game, these are some excellent and practical growth tips.
Here’s the link to their session, “Tips from insurgent brands: How to success hack Amazon Advertising.”
John Denny is VP Ecommerce & Digital Marketing at Cavu Venture Partners, and Luis Navarrete Gomez is Head of Global Search Marketing at LEGO.