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Amazon Advertising

Founder and Managing Director at Marketplace AMP, Amazon Advertising Agency

Why is this interview interesting?

  • Amazon ad formats
  • Growth in CPC on Sponsored Display and DSP
  • Who Amazon is taking market share from
  • Why Facebook could be under pressure
  • How Walmart is looking to roll out their own ad platform

Executive Bio

Matt Anderson

Founder and Managing Director at Marketplace AMP, Amazon Advertising Agency

Matt is the Founder and Managing Director of Marketplace AMP, a leading UK-based Amazon digital agency. Marketplace AMP focuses on allocating advertising spend for grocery, food, and health brands across Amazon, Walmart, Ocado and has experience on Facebook and Google for other brand categories. Matt has been working with Amazon Marketing Services for over 11 years and is one of the most experienced Amazon advertising specialists in the UK.Read more

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Interview Transcript

Disclaimer: This interview is for informational purposes only and should not be relied upon as a basis for investment decisions. In Practise is an independent publisher and all opinions expressed by guests are solely their own opinions and do not reflect the opinion of In Practise.

Matt, can you open with some background about your current business?

My name is Matt Anderson and I am the MD of Marketplace AMP. We are an Amazon specialist agency; one of the leaders in the UK. We focus on grocery, food and drink, pets and health and beauty brands, in the UK, EU and USA. I’ve been working on Amazon for the last 11 years.

What is your split in your total ad spend from your clients, between the major platforms of Amazon, Facebook or any of the other digital platforms?

About 80% of our spend is through Amazon. We work with other marketplaces, such as Ocado, Walmart and eBay.

Let’s say that I am a large CPG or food-product brand, what different formats are currently available on Amazon, for me to advertise?

Amazon advertising is vast now; there are a number of different formats you can use to advertise there. Let’s just roll back and look at a traditional paperclip version; people that have worked at Google will understand how that works. There are sponsored products, so you can make your products stand out – health bars, for example – and that is just a product ad or a banner. You then roll out into types of display targeting, as well.

Across the customer journey, in the buy box and on the product page, it is getting more and more sophisticated with being able to target consumers who used similar products in the last 30 days or interest groups, as well. You can start rolling out sponsored brand videos, for targeting consumers.

It differs from Google because, rather than just looking at the key words, you can target specific ASINs or specific SKUs of your competitors, for example. It’s quite a cutthroat world on Amazon. Over the top of that is a demand side platform, for which we have got a seat, as an agency. Basically, for every consumer, Amazon will put you into buckets of interest and what products you have been in the market for and which products you have bought before. It builds up a vast number of data points about consumers, across the Amazon platform, across the app, across Alexa, across Amazon Go. We build up a profile of consumers who have got the highest propensity to buy.

DSP is slightly more sophisticated because it uses machine learning to understand that you are more likely to buy football memorabilia on Amazon than me, because I prefer rugby. It will learn over time, so the output is quite sophisticated. It can learn what types of interest groups and demographics are best suited for your brand. Then we can actually follow that consumer across the web – as you can with Google – by laying hundreds of different news sites, Food Channel, Discovery and so on. You can really drive vast amounts of traffic into the listings, as well.

It’s a complex beast and I think one of the reasons why it is accelerating so rapidly because, over the last three or four years, it’s gone from quite a rudimentary and clunky platform to a very sophisticated one. They have clearly been investing a lot of money in it.

How have you seen brands evolve, in the way they use the sponsored brands format?

The sponsored brands format is the banner ad at the top. A lot of brands got quite focused on branded search. I understand that because when marketing directors search for their brand, they want to be able to see your products and your ads. But 77% of people on Amazon go onto Amazon to be inspired about brands to buy and will search generics. They won’t search for a toilet roll brand, but they will search for toilet roll, or whatever it may be.

What we are trying to educate customers about is that if you want to really grow your piece of the pie, you want to be focusing on generic search. The way it has evolved is looking higher up the purchase funnel. For example, if you are looking for cleaning products, you might be looking for bleach, you might be looking for surface cleaner. But you want to be inspired by a storefront that shows you the whole range of products, rather than just a specific one. Now they have got a video format and there is a spotlight format, as well. Consumers can navigate through the store, on a mobile format, in a very sophisticated way, to aid their buying mission.

How do you see video changing the return on the sponsored ad format?

I’ve been in digital for over 20 years. When you are looking at social or anything on the web, video will outperform everything from a glanced view to clicks and so on. We’re seeing that in a similar fashion, on Amazon. The click-through rate is much higher; the engagements are much higher on video. It is a cheaper cost per click format, but I don’t necessarily think that’s the format; I think that’s because less brands have enough video to deal with that so there is less competition.

Do Amazon help the brands with the creative, around video?

That is an issue for point of entry but yes, they do. They have a video creative build up, which is quite rudimentary and has a stock motion element to it. It doesn’t look highly polished but it can help you do that. That said, there are loads of different types of ad format or agencies that can help. There are a lot of stock video libraries – such as Shutterstock – that can help you with that video, as well. But Amazon do provide a rudimentary format although, to be honest, a lot of our clients don’t really find that it provides a high enough quality video experience to be on brand, as such. But if you are a seller, for example, and you are launching a brand, it’s good enough.

How has the pricing changed, over the last few years, for those banners on the key products?

When we first started talking about Amazon, I think about 46p a click was the average in the UK. Now, we’re at 90p plus. Over the last three years, there has been about a 100% increase in cost per click. You are going to find that with any platform. I think more and more competition is going to drive those prices up.

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Amazon Advertising

July 12, 2021

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