Don’t Get Left Behind: Amazon SEM is Essential

Brands rely on SEM Managers to drive traffic and maximize ROI for advertising campaigns. To do this, SEM Managers are tasked with tracking, reporting, and analyzing pay-per-click (PPC) analytics from paid search campaigns, identifying trends and then acting on them. Though the job may differ from brand to brand one thing is constant: Google Adwords is going to represent the bulk of the paid search they work with.

For consumer brands, however, Google Adwords is no longer the one-stop solution for paid advertising. The rise of Amazon as a search engine and its position at the bottom of the sales funnel has now made Amazon SEM an essential component of any competitively paid search initiative.

Amazon SEM

Google Adwords: Leading the Pack in Paid Search Advertising

Taking up over 77% of the US market share in 2016 and bringing in more than $100 million a day, Google dominates paid search advertising. By using sophisticated algorithms utilizing keywords, location, language, and more, Adwords allows brands to target searchers in specific ways at different points throughout the shopping journey. It also serves a wide variety of companies, with both B2B and B2C companies depending on Google Adwords to drive site traffic.

Most commonly, Adwords advertising is seen by customers at the top of the sales funnel. These customers are actively looking for product information before making a decision to buy. Google ads can be placed on any sites within the vast Google Network, reaching roughly 90% of people on the internet.

Because of their widespread visibility and dominance in paid search effectiveness, Google Adwords understandably generate vigorous competition, resulting in higher CPCs for brands. Regardless of the high price tag, the effectiveness of Adwords and omnipresence of Google makes the service the cornerstone of any SEM Manager’s initiatives.

Don’t Ignore Amazon SEM

In recent years, Amazon has transcended its role as the world’s top online retailer to become one of the most used search engines as well, with 38% of consumers starting their product searches on the site compared to 35% on Google. And unlike searches on Google, Amazon searches happen closer to the bottom of the sales funnel, where it’s easier for customers to buy once they’ve found the information they’re looking for.

Because Google ads are likely to be seen at the beginning of the search process and Amazon ads closer to the end, Adwords campaigns generally have a lower Return On Advertising Spending (ROAS) and higher keyword CPC than ad campaigns on Amazon Advertising (formerly known as Amazon Marketing Services).

These competitive rates allow smaller companies with sound advertising strategies to compete directly with well-known brands: driving traffic to product pages, boosting conversions, and improving product placement and search rankings. Newer brands can use Amazon ads to effectively raise brand awareness, as well. Bai Beverages coordinated their Super Bowl advertising efforts with concentrated Amazon Advertising and saw their impressions jump to 1.5 million a day.

Amazon Advertising offers an “autopilot” setting for ad campaigns that allow brands to have a hands-off approach but carefully managed Amazon SEM campaigns to reap the biggest returns. When Newell Brands tasked content26 to restructure 31 existing campaigns, they saw their ROAS increase 3X and CPCs drop from $1.24 to $0.44.

The Rise of Amazon as a Marketing Force

Though Amazon Advertising is quickly becoming essential, it doesn’t yet carry the name recognition or sense of importance as Google Adwords, which is great for brands that still haven’t integrated Amazon SEM into their initiatives. And because the service is still somewhat new, the competition for keywords is still relatively low, making the service a viable option for brands of any size.

This isn’t going to last forever. Amazon is only going to get bigger. And as their dominance of the online marketplace expands, so will their importance in the world of paid search. Getting familiar with Amazon ads is essential for any SEM Manager who doesn’t want to get left behind.

Editor’s Note: On September 5, 2018, Amazon rebranded its advertising platform. Amazon Marketing Services changed to Amazon Advertising and Amazon Advertising Platform changed to Amazon DSP, among other changes. This blog post was changed on October 5, 2018 to reflect those changes.