Amazon Ads – The Breakdown

The online retail industry has exploded in popularity in recent years. Annual retail E-commerce sales are predicted to surpass $5.5 trillion by the end of this year. And at the top of the list for E-commerce companies is Amazon. If you’re a seller on Amazon, you’re already off to a good start. But there is so much competition on the massive platform, it is difficult for brands to stand out. Luckily, there are various ways online sellers can grow their businesses and make a unique name for themselves on Amazon. One feature you’ll definitely want to take advantage of is ads. You can have fantastic product pages and optimized listings, but if consumers are not aware of your brand, this will only get you so far. Advertising gives brands increased exposure as well as a more professional image. Amazon offers a plethora of different types of ads and ad campaigns to choose from. How do you know which is the best for your business? Here we’ll break down the various types of Amazon ads and everything you need to know about them.

Sponsored Product

A basic type of advertisement on Amazon is the Sponsored Product ad. This is a cost-per-click (CPC) ad that markets specific product listings. These ads will appear in search results and product listings that bear similarity to your product. This is a great type of ad for beginners to utilize because it offers automated targeting, meaning Amazon will do the work for you and find the proper audience for your ad. And because Sponsored Product ads are cost-per-click, you only have to pay when a customer clicks on the ad. You can control how much you pay per click by setting a budget for your bid. Amazon uses an auction-style system for their cost-per-click ads. Meaning, sellers are competing against each other for ad space. So the higher your bid for a specific ad, the more likely your ad will appear when a customer searches for a relevant product.

Sponsored Brand

Similar to the Sponsored Product ad, Sponsored Brand ads promote your brand on relevant searches and pages. With a Sponsored Brand ad, you can use custom headlines, videos, and images to attract consumers. These ads are also cost-per-click and when customers click on either product images or categories in the ads, they are taken to your product page. Sponsored Brand ads allow sellers to be creative with imagery and graphics, increasing brand exposure and gaining web traffic on your page.

Sponsored Display

Sponsored Display ads are a third type of sponsored ad that will appear as a banner or image. These ads run automatically  and can appear both on Amazon and third-party sites. For Sponsored Display ads, sellers have the option to customize their ads with their own images, logos, and headlines or they can use Amazon’s generated image for the ad. These ads can be either cost-per-click (CPC) or cost-per-thousand viewable impressions (vCPM). With this type of ad sellers can use either Contextual Targeting or Sponsored Display Audiences. Contextual Targeting focuses on specific products and categories within a detail page on Amazon. Sponsored Display Audiences uses shopping signals to display your ad to relevant audiences. Both of these strategies can be combined as well to make for an even more effective advertising plan. 


Another way to advertise on Amazon is through the Amazon Storefront. The Storefront is a multi-page display for your business where you can show your products and create an engaging experience for consumers. Amazon Stores comes with already made templates and features that sellers can use. Business owners can add images, video, and text to present their brand. Creating an Amazon storefront is totally free and a great option for a beginner advertisement. You can link to your storefront on product detail pages or by directly providing customers with your store URL. 

Audio Ads

If you want to give shoppers a break from the screen, audio ads are another creative way to advertise your brand. Sellers can create audio ads between 10 and 30 seconds that will play on Amazon regularly. You can use music and get creative with audio ads to make your brand stand out. This type of ad requires working with an Amazon Ads account executive and typically spending at least $25,000. Audio ads are sold by cost-per-thousand-impressions (CPM).

Video Ads

Video ads are another way to advertise on Amazon to audiences while they are watching TV. Sellers can use video ads to reach audiences through various Amazon streaming platforms including FreeVee, Twitch, Prime Video, TV network and broadcast apps, and the news app on Fire TV. Video ads are a great replacement for traditional cable television commercials which have now become outdated. These ads give sellers the chance to reach audiences while they are engaged and watching something they love. Sellers can either manage their own video ad campaigns or work with Amazon ad consultants. Managing your own campaign typically costs at least about $50,000. 

Custom Ads

Custom ads are a comprehensive approach to advertising on Amazon. These ads involve working with Amazon marketing professionals to give your brand a unique ad campaign. Members of Amazon’s Brand Innovation Lab use the platform’s shopping data to place your ad in front of the proper audience, at the right time. The team advertises your business across several platforms, including Amazon’s subsidiary businesses. With custom ads, a seller’s ad can appear online, in Amazon stores, and even on the boxes of your products. Using custom ads, you can work with a team of professionals to enhance your brand. This is a great option for sellers who want to go all-out and create a professional ad that will reach a larger audience and give their brands a name. 

Amazon DSP

A final way to advertise on Amazon is through the Amazon Demand-Side Platform or DSP. This strategy allows sellers to use automated software that performs media buying. This means the software will automatically purchase slots for your ads and different types of ads on Amazon and other media platforms. With DSP sellers have access to Amazon shopping signals and insights to expand their reach. Sellers also have the option to fully control their campaigns or to work with Amazon consultants when using DSP.

As we have seen, with Amazon advertising there are a bunch of great options. If you’re new to advertising, a great place to start is with sponsored ads like the sponsored products, brand, and display ads. The Amazon Storefront is also a great beginner’s option as it is completely free for Amazon sellers. As you grow your business you can start utilizing more advanced ad campaigns and combining different advertising strategies to promote your brand. Now that you have all of the information, you can go and get advertising, good luck!

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