Amazon Product Ads: Good Idea? Bad Idea?

It never ceases to amaze me how much Amazon packs onto its product pages. In addition to the products it sells, Amazon product pages include banner ads, links to the product from other sellers (Marketplace), forum links, Listmania, more banner ads, Sponsored Links, Customers Who Bought Also Bought, Better Together, reviews, customer tags, Amapedia…

Add “Related Items from External Websites” to this list, which shows “related” product thumbnails and links to other sites participating in Amazon’s Product Ads program. Product Ads is a pay-per-click program that allows any merchant to advertise products (with thumbnail images – depending on which browser the customer is using) right on Amazon product pages. Details here.

According to Amazon’s Product Ads description, PPC placements may appear close to the cart button:

As you know, Amazon is continually testing – so I wouldn’t be surprised if I’m seeing different placements than others. Rather than the above, this is what I see when I’m on Amazon.com:

My concerns about this program:

1. Is this what customers want? “Product Ads is an advertising program designed to provide Amazon.com customers seamless access to products available on external Web sites.” Many customers choose Amazon for free shipping/Prime, the A to Z guarantee, they already have an account and the trust they have with this established retailer. When you roll over the related offer links, you can’t preview the destination URL, it’s an Amazon redirect which may confuse customers – they don’t know where they will end up, or they’re surprised when a new site opens up (yes, even if you mention “external websites.”

2. Right now, the recommendations are not very relevant. The above related items (candles and faucet) were suggested for this dog toy:

Irrelevant offers means lower click through rates for advertisers (yes, Amazon uses a combination of bid and click through rate to determine placement and final cost-per-click). It also means more confusion and clutter for customers. But I’m sure this will all improve over time.

3. These ads potentially take sales away from Amazon and Amazon Sellers in the marketplace. As a seller, I don’t appreciate Amazon pointing potential customers elsewhere.

Nevertheless, this is another traffic channel if you’re looking for a way to tap into Amazon’s gazillions of shoppers. I’d be interested to hear from any advertisers who’ve played with these ads. What’s the traffic quality? How does it convert compared to other PPC programs?

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10 Responses to “Amazon Product Ads: Good Idea? Bad Idea?”

  1. In my experience using Product Ads as a retailer, I did see good CTR and rather high ROI on this channel over other cost per click engines when used for top performing products. It definitely beats paying x% commission rate to Amazon for marketplace listings. Amazon is always testing the algorithms that display and relate products from Product Ads to regular Amazon listings. It seems to work best right now with hard product categories where UPC, MPN, etc are available. I think there is appeal to merchants with low margins to try Product Ads, and Product Ads also makes it easier for merchants to get exposure, traffic and sales from Amazon.

  2. As a data feed management consultant, I recommend testing Amazon product ads to those clients who do not have UPC/MPN data in their product data feeds and cannot get a UPC exemption. I also recommend it to those clients who would be placed in high commission/fees categories where Amazon can charge up to 15% commission. The CTR is good and the ROI can be good if you do your job right.

  3. [...] Explore new products – Facebook launched a new behavioral-based ad program. So did Google (they call it “interest-based“). Yes, opinions are split, with Mashable arguing in its favor, while GigaOM is more skeptical. But, the point is, lots of new opportunities exist to improve your marketing and have it produce results. Even Amazon has a new product ad tool. [...]

  4. Rob says:

    Amazon product ads is a total sham.

    Not only do they:

    1) Have a terrible ROI
    2) Refuse to refund credit cards that have been incorrectly charged, and instead credit accounts for MORE useless clicks

    But they moderate their forums so that no one can complain about it.

    Terrible company.

  5. Dani says:

    My experience with product ads so far, is this: I’m holding out hope for it, but in it’s present state, it leaves a lot to be desired. I do have a low profit margin product, so the product ads seemed like a perfect alternative to the much more expensive seller account.

    While the actual explanation of how to set up your product ad is unclear and cumbersome, help is only seconds away with Amazon’s ‘phone’ > “call me now” feature. No sooner did I click call me now, then my phone was ringing. The prompt response was very appreciated and easily talked and walked me through the technical details, but the biggest problem is that after an entire day of setting this up, I still can’t find my ads displaying anywhere on any highly related categories> products>> and keywords.

    My ad page is live, and I sent a few friends to the link and had them click through to my site. My cpc bid was set to 10x the minimum (minimum is $.15, so I set it to $1.00) and I was only charged the $.15, so that tells me the bid is high enough.

    Support could not provide me with any information regarding where my ads are being displayed, and so far, the only traffic I have, is the traffic I sent to it just to test the ppc bid to see if that was the problem, which it obviously wasn’t.

    I really want to see this program succeed, but right now, my experience with it indicates that it needs a lot of work before it’s worthwhile to me.

  6. Dani says:

    Woops… the cpc was $.10, not $.15

  7. hugh says:

    Product Ads don’t convert well. We used Google Adwords and Bing and Yahoo for years and have to say, Google wins, Bing comes in second and Amazon and Facebook come in way way last, even behind a flyer on a telephone pole. All of the platforms will take your money and are a substitute for old fashioned hard work, There are no easy ways to get customers and no silver bullets. Stop feeding the Billionaires now. You don’t get any value. Now we look for smaller operators who appreciate our money and don’t spend all night trying to figure ways to make us spend more unneccesarily. Minimum set bid prices on Amazon Product Ads is just another way to waste your money. Besides so many items on Amazon are sold below cost or have an inflated MSRP so when you get a visitor and you have normal prices they freak out and go back to Ebay or Amazon or the counterfit store leaving Robo-reviews everywhere they go. Amazon drove up the price of Adwords so high most bike shops can’t afford to advertise anymore. We tried an Amazon store twice and Product Ads once, Amazon always seems to end up winning.
    Moral of story….. try Product Ads and you’ll see high cost per conversion and you immediately begin to think of all the ways and all the people who could really use that money better.

  8. Jonf says:

    Not seeing any good reason to use this yet. People click and check the price and go away or maybe come back all before even thinking of buying from your ad. You will get clicks, yes, but that will cost you. You will get sales? Well that is what I thought but still just clicks and no sale..If you can’t get a sale before the free $75.0 is used up then well do you want to keep paying out of pocket for traffic that doesn’t buy?

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