On the 18th of July, our CEO & Founder, Sönke Hansen, was interviewed by the InternetWorld about Amazon Marketing Services and campaign planning. Ahead of the AmazonWorld Summer Camp, he shared some insights on the advertising business on Amazon.
Read the translation of the German interview below!
Amazon marketing has fallen into disrepute: recently, more than 30 retailers reported cutting their budgets sharply, without experiencing any loss of sales. Sönke Hansen, founder of the marketplace agency “ameo”, advises caution when planning your campaign.
Earlier this month, success stories of more than 30 Amazon retailers, who significantly reduced their marketing expenses without any loss of turnover, had been spreading like wildfire – yet the “Amazon marketing is severely overrated” thesis by Amazon expert, Christian Otto Kelm from Amalyze, is still heavily discussed by relevant dealer groups.
We have asked Sönke Hansen, founder and managing director of the marketplace agency ameo, and co-organiser of the AmazonWorld Summer Camp in Hamburg, for his opinion on the matter.
Mr. Hansen, your colleague, Christian Otto Kelm, recently told the OMR that “Amazon marketing is severely overrated”. Multiple dealers have also reported that their Amazon marketing expenses have gone down, without seeing any loss of sales. On the other hand, other experts advise against reducing advertising expenses too sharply. What are your thoughts on these matters?
Sönke Hansen: The discussion is nothing new – Henry Ford once said: “Half the money I spend on advertising is waste, and the problem is I do not know which half”. Today, we have much more control options in online marketing. However, Amazon is sadly not an easy field for data processing. In order to get the best possible results, one must export and match over a dozen reports a day. The data source is not only Amazon Advertising, but also the Vendor, or rather, Seller Central. This forces spreadsheet applications, such as Excel, to their knees – you need a powerful database and a way to visualise this.
Have any of the changes, which Amazon Marketing Services (AMS) have implemented earlier this year, helped in the evaluation and more targeted control of campaigns?
Hansen: With the attribution beta, Amazon is testing the possibility of allocating the origin of sales – even outside of Amazon. This would close a serious customer journey gap. We are also happy about the new control capabilities involving negative keywords in sponsored brands and product targeting. Another milestone was the start of agency certification through Amazon, which finally allows for more transparency when comparing agencies.
How can dealers professionalise their advertising business on Amazon using these tools?
Hansen: The goal should be to significantly reduce the share of advertising that does not work or that only cannibalises organic traffic. There should be more effective campaigns. For example, a manufacturer displays advertisements for his own brand. This campaign probably has great KPIs. Yet the sales figures might have been higher, if the brand was already dominant in the organic rankings. When these campaigns come to an end, the total revenue is unlikely to change, but the margin will increase. However, if a campaign does bring in a tremendous number of visitors and the product is not listed properly, organically speaking, it will cause a serious drop in sales. In order to distinguish between measures that work and measures that don’t, one should differentiate campaigns by purpose, as well as advertised products, on the one hand. On the other hand, one should create possibilities in order to better evaluate these campaigns.
How exactly are Amazon sellers controlling their ads today?
Hansen: In 2015, you could use a comparably large lever through SEO methods. Today, the bar has clearly been raised, as most dealers and manufacturers have now understood the importance of high quality SEO content. Many also use advertising efficiently. Although, the combination of all these methods is a hurdle for many larger companies. There is still a lot of potential here for structuring the numerous possibilities, offered by Amazon.
At AmazonWorld Summer Camp on the 29th of August, in Hamburg, you will be talking about “5 Quick Hits for Amazon”. Could you give us a little insight into what listeners can expect?
Hansen: For starters, I will give a brief overview of the different subjects. My goal is to ensure that everyone can take a “quick hit” to start off their day. Additionally, I will be discussing basic content indexation, brands, and advertising.
Do you want to know more? Contact us and we will help you discover what you can achieve on Amazon!