October 2019 Bezos Bulletin: Artificial Intelligence, Conquest Marketing, & Amazon Advertising

Sarah Davis Content AuthorPublished October 2, 2019

Artificial Intelligence & Amazon Advertising

Artificial intelligence (AI) is one of the biggest buzzwords around right now – and for good reason. With the ability to analyze large amounts of data and lower marketing costs through automation, AI has the potential to greatly benefit ecommerce brands.

One way that AI is entering the playing field for marketers is through bid optimization. Calculating the most effective bids to place can be a major challenge for brand strategists. Between keyword traffic, cost-per-click, click-through rates, advertising cost of sale, and more, the number of factors to take into consideration when trying to optimize keyword bids on Amazon can easily become overwhelming for a human.

Advanced AI tools for Amazon advertising can quickly take all sorts of metrics into account, put them through dozens of different algorithmic models, and decide whether to lower or raise bids and by how much.

Still, AI has its limitations. For example, a crucial element that AI lacks in paid search is the human ability to executive unconventional tactics that go beyond KPIs. Because it can’t consider your high-level, qualitative marketing goals, it should be limited to making optimizations. It’s also not great at responding to long-tail terms because it needs enough search data to learn from – it’s most effective in campaigns with at least 15 conversions per day. This means it won’t be much help in targeting new customers with niche interests.

Even as artificial intelligence permeates our existence as marketers more and more, the most efficiency and value will come from combining AI and automation tools with nuanced human knowledge.

Conquest Advertising on Amazon

Amazon has become the perfect platform for conquest marketing, a form of advertising where brands place their products directly next to competitors’. Sponsored product ads are the perfect example of this. Consumers may search for one specific product, but see ads for a different, but similar product.

And it isn’t limited to branded searches. Broad searches like “running sneakers” or “laptop computers” are highly valuable to new and established brands alike because they provide the opportunity to advertise at the very top of search results before shoppers even see the organic results. That being said, these placements are highly competitive and the difficulty involved in locking into them shouldn’t be underestimated. No matter how you go about it, advertising your product to shoppers who have previously bought from your competitors or searched for related products can be an extremely effective way to convert new customers.

Now that more product searches begin on Amazon than Google, brands are beginning to treat the platform more like a search engine that allows them to advertise their product. Additionally, since 80% of Amazon customers use the platform as a way to discover a new product or brand, conquest advertising provides you with the perfect opportunity to snatch a sale – especially if your product has strong reviews and is available at a lower cost than your competitors’ product. Amazon’s capacity to introduce consumers to new products will only increase as Gen Z shoppers, who are very open in terms of brand preference and have grown up with the ability to search for products on their phones, continue to gain more buying power.

 

Looking for additional Amazon content? You can find our previous Bezos Bulletins below:

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