How to Set Up an Amazon Custom Ads Campaign

There are two distinct types of custom advertisements available from Amazon, both offering unique, creative, and effective ways of marketing products or businesses. While both services utilize Amazon’s wide-reaching data pool and eCommerce experience for a tailor-made service, they remain two very separate resources in terms of method and outcome.

Amazon Custom Ads is an original, bespoke marketing service that is intended to promote a business or product in engaging and creative ways, both on- and offline. This service has seen some of the most remarkable marketing campaigns of recent years and is perfect for small businesses looking to increase brand awareness in a big way.

Amazon Native Custom Ads is less of a high-impact, high-reward scheme, and is more suited for companies looking to increase their revenue without expending large amounts of company resources. Native Custom Ads are part of Amazon Advertising’s Affiliate Program, which allows sites to increase earning by displaying product ads.

While the overall outcomes of these two forms of advertising are very different, they both work to appropriately engage target audiences while using Amazon’s data analysis to their advantage. It is this combination that makes both Amazon Custom Ads and Amazon Native Ads vital tools for businesses.

This is a guide that will help further your understanding of how Amazon Custom Ads can be used to promote growth. It begins with an outline of the potential for custom advertising as an effective way of marketing to target audiences, noting the particular advantages Amazon has over its competitors. Then, it turns its focus to Amazon Custom Ads, demonstrating their versatility through case studies. Thereafter, attention is turned to Amazon’s Affiliate program, specifically Native Custom Ads. The article finishes with a list of key industry terms, to help any reader sound like an advertising pro.

Why are Custom Ads so Important for Small Businesses?

To fully understand the effect custom advertising can have on the success of smaller businesses, one needs first to consider the impact that properly identifying and engaging with a target audience can have.

For those who aren’t aware, a target audience refers to a specific group of people a product is being marketed to. To find a target audience, a company might break down the market into individual segments, often by age, gender, education level, income, marital status, or geographic location, or by identifying a particular ‘personality type.’

Knowledge of the intended target audience then informs the specifics of an advertising campaign. For example, a recent study has found that millennials and generation X are more likely to seek out products that are labeled organic, GMO-free, and hormone-free, as opposed to older generations who appear to pay less attention to this style of wording. Knowledge of this will help a company employ further methods to stand out to the appropriate generation and give them an edge over the competition.

Ultimately, effective engagement with a target audience is all about establishing relevance. If the business profile and products match audiences’ preferences, they are much more likely to become a customer, whereas if the customer being targeted is ‘everybody,’ it leaves a business less able to connect at a deeper level. The more connection is made between a business and customer, the more long-term loyalty there will be.

What Gives Amazon its Edge?

It won’t be news to any business owner that implementing a successful internet marketing campaign can determine the long-term success of a company. The majority of internet marketing strategists focus on two main areas: Search Engine Optimization and Social Media. While both these techniques are very important, focusing only on these limits the way a customer is able to interact with the brand.

While Google and Facebook have long been seen as having a duopoly over the internet advertising market, Amazon is rapidly challenging their leadership. There are two main reasons for this.

Firstly, Amazon has over 300 million active customer accounts worldwide –  in other words, Amazon’s share of the eCommerce market is at 49%, which is more than its three biggest competitors combined (eBay at 6.6%, Apple at 3.9%, and Walmart at 3.7%).

It is not simply the enormous number of customers Amazon has that provides its edge, but rather, how this translates into a large bank of data. This data provides Amazon marketing with everything it could need to predict, model, and target customer behavior to ensure marketing is personalized and relevant. This is why Amazon has a higher customer conversion rate than, say, Facebook: not simply because it is an eCommerce site, but because of the data that it provides.

What is Amazon Advertising?

Amazon Advertising was established in 2018, a rebranded form of Amazon Marketing Services. Initially only offering its services to vendors selling onsite, it is now open to any business.

It can be difficult, to begin with, to understand how Amazon’s advertising techniques differ from those of Facebook and Google; after all, they all use pixel-based targeting to track and capture users’ behavior. The difference lies in the particular data they have access to. While Facebook and Google have to use examples of what people are interested in to interpret the most appropriate ads, Amazon is able to see what and how people shop, taking a lot of the guesswork away. The data Amazon will have on a customer can include what they buy, when they buy, what books they read, what films they watch, and what questions they ask their voice-activated devices.

Once this data has been gathered, it is inputted into a Collaborative Filtering Engine, which interprets a very large amount of an individual’s data points, creating a user profile. Next, Amazon systems will compare users with similar profiles to create an even more complete impression. An example of a completed niche is: employed males between 18 and 45, living in a rented house with an income of over $30,000 who enjoy foreign films.

While these profiles are already predicting customer behavior with impressive accuracy, they are only going to become more successful. As the number of patterns and data that Amazon collects grows, the more effective its prediction becomes. It gives brands the ability to target customers who have made similar purchases. This is only the start of the potential of targeted ads. A user only needs to exhibit behavior that hints that they might want your product for Amazon’s analyses to be able to make an informed suggestion.

Amazon Advertising has some of the most extensive data analysis on the market. When used in the custom ad format, it allows for some of the most effecting targeted marketing possible.

Which Type of Ad Campaigns are Available?

Since Amazon’s Custom Ads is a completely bespoke service, it can incorporate any or all of the other advertising packages offered. To show just some of the potential that can come from the custom service, as well as to inform a better understanding of what might suit a particular company best, understanding all forms of Amazon advertising is important.

Amazon’s marketing packages can be broken down into two different forms: pay per click and demand-side platform (see the key terms for more information). Within these categories, there are different types of advertising forms on offer.

Amazon PPC Amazon DSP
Does the company have to sell on Amazon? Yes No
Where are the ads shown? On the Amazon site, as well as third-party websites and applications On Amazon devices, Amazon-owned websites and other sites On video content or part of Amazon display ads
Who can use the service? Amazon vendors and sellers Amazon DSP clients who have a budget exceeding $35,000 and who want to
work with an Amazon Advertising Consultant.
Or brands who are willing to work with a qualified agency to access Enterprise Self-Service.
Where will the ads direct the user? Amazon pages Any page off or on Amazon
How are the ad placements charged? Pay Per Click Pay per thousand impressions
What are the options for targeting? Keyword, ASIN, brands, and categories Behavioral, Lifestyle, Contextual, Remarketing, Advertiser Audience

Key Industry Terms:

Here are some of the most important industry terms to know before embarking on any advertising campaign. While some are exclusive to Amazon, others are widely used.

General Advertising Terms:

  • Attribution: this term refers to the advert or adverts responsible for transforming a viewer into a customer.
  • Consumer purchase journey: this refers to the experiences a shopper will have when interacting with a company; it is often used when looking for the best ways to improve this interaction.
  • Keyword: a word or a phrase that is the focus of digital content, used to attract a relevant target audience.
  • Placement: the position an advertisement appears, online, in print, or, for example, on a billboard.
  • Programmatic: this is a word used by those in the digital advertising industry to refer to the automated buying and selling or advertising inventory.
  • Demand-Side Platform (DSP): a software used by advertisers to buy mobile, search, and video ads from marketplaces on which is listed advertising inventory.

Targeting: the way in which advertising services match potential customers with ads relevant to their interests.

Financial Terms:

  • Budget: the financial limit for any money spent.
  • Bid: this is the maximum amount a company is willing to pay to when a shopper clicks on their ad.
  • Cost-Per-Click (CPC): this is the average charge from someone clicking on an ad. Amazon calculates the number by dividing the amount of money spent on an ad by the number of clicks it received.
  • Cost-Per-Thousand-Impressions or Cost-Per-Mile: this is the average cost paid for 1,000 impressions of an ad.

Terms Regarding Advertising Campaign Results:

  • Advertising cost of sales (ACoS): this is a term used almost exclusively by Amazon, defined as: ‘A metric used to measure the performance of Sponsored Products and Sponsored Brands campaigns. ACoS represents the ratio of ad spend to promoted product sales (Sponsored Products) or overall brand sales (Sponsored Brands). It is calculated as ad spend divided by attributed sales.’
  • Brand lift: this is a way of identifying the effects an advertising campaign has had on increasing interaction with a business. It is usually used to show a positive shift in customer perceptions.
  • Click-through rate (CTR): this is another way of measuring the success of an online ad campaign. The term refers to the ratio of users who have clicked on a link versus those who have looked but not clicked through. The common method to work out a click-through rate is the number of clicks, divided by the number of impressions, times 100.
  • Conversion: this refers to the transformation of a business’s visitor (whether online or in-store) to a customer.
  • Impressions: the number of times that an ad appeared on a page or device.
  • Reach: the total number of people shown an ad.
  • Return on Ad Spend (ROAS): the amount made versus the amount spent on an ad.
  • Return on Investment (ROI): a measurement of the net profit earned on the money spent.

Amazon Advertising Packages:

Amazon Advertising Packages
  • Sponsored Products: these are self-service, pay-per-click ads that show individual product listings and will appear in the shopping results or on specific product pages. The objective of these is to increase sales and to attract traffic to product pages.
  • Sponsored Brands: another self-service, pay-per-click ad tool. This time for brands, it can appear in shopping results or feature a ‘custom headline brand logo.’ Working best with registered Amazon sellers, these ads can include three or more products, a brand logo and a custom phrase to increase brand awareness and overall sales.
  • Sponsored display: self-service, pay-per-click display ads that are automatically generated. These ads are targeted to audiences found from relevant Amazon shopping interests.
  • Display ads: these ads appear both on and off Amazon. They can be generated by Amazon or created or by the businesses themselves.
  • Video ads: these are displayed on Amazon sites such as IMDB or Amazon Fire TV, as well as across the web; they can be managed by the DSP user or by Amazon ad consultants.
  • Amazon Attribution: measuring how non-Amazon advertising media drives sales to Amazon stores.
  • Amazon Stores: a free resource that works as a multi-page feature in a product portfolio that helps to tell a brand’s story.
  • Amazon Demand Side Platform: this enables advertisers to buy display and video ads.

What are Amazon Custom Ads?

Since Amazon Custom Ads are just that, custom, the particular advertising campaigns it produces differs greatly from business to business, from taking over the Amazon homepage on Black Friday to using Amazon’s own boxes to advertise.

Amazon Custom Ads

Rock N’ Roll Tour

One example of the enormous potential of this style of advertising, both creative and physical, can be demonstrated with the campaign with 20th Century Fox for the Bohemian Rhapsody film.

Building up to the UK release of the movie, Amazon and Fox worked on a marketing strategy that would increase awareness and engage fans of Queen, as well as fans of musical films in general. A subsequent aim was to reach new customers and to drive sales of DVD, Blu-ray, and screening rentals.

The campaign’s main focus was a rock ‘n’ roll tour to celebrate the release of the film. Their Treasure Truck tour stopped in London, Birmingham, and Manchester in March 2019. Amazon described this campaign as a ‘360-degree campaign focused on awareness and brand building.’ It featured out-of-home, experiential advertising and custom creatives. An awareness campaign ran alongside this tour, which employed more traditional advertising techniques to drive sales on and Amazon Prime. Amazon reported a 7.28 return on ad spend, with a total of 56MM digital impressions, which exceeded the benchmarks for impressions by 70%, as well as 10 MM social media reach.

Amazon reported

Prime Now. Drive Now

Another example is the Prime now. Drive now campaign, which ran for two weeks in 2017. This involved a video that advertised a service where prospective buyers had the chance to schedule a 45- to 60-minute test drive. The real originality came from the fact that this test drive involved a trained expert conveniently bringing the car to their desired location. It could be a house, a coffee shop, or an office, making the whole process a whole lot quicker and simpler. If a participant then wanted to purchase the car, they would be taken to a local Hyundai dealership to finalize the payment. This campaign was so successful that Volvo followed suit in 2018 with a similar set up in London.

Drive Now

Not only does this style of creative, original advertising effectively engage with target audiences, but it also brings a huge increase in brand awareness, in addition to improving customer perceptions. As this Harvard Study found: ‘nothing is more efficient than creative advertising. Creative advertising is more memorable, longer-lasting, works with less media spending, and builds a fan community faster.’ For businesses looking to raise their brand profile, Amazon’s Custom Ads service is probably the best option out there right now.

Since it is a bespoke service, very few details are known about the process of creating these ads, including the minimum spend required. The first step you need to take is to contact an Amazon consultant, who will send an information package and explain the next steps.

What are Amazon Native Custom Ads?

Amazon Advertising offers more than simply opportunities for businesses to increase revenue through the promotion of their own products or brand. For those looking for a little more income without a big payout, there is a different type of Amazon Custom Advertising that might be the perfect solution.

Amazon’s affiliate program, called Amazon Native Ads, can be used on any blog, social media platform, content site, or extensive network to earn a company a constant stream of passive earnings.

How Does It Work?

For those not familiar with affiliate programs, here is how they work:

A visitor to a site clicks on the Amazon Native Ad. They are then taken from the original website to the Amazon page of the product displayed on the ad. If this person then goes on to purchase this product, the site displaying the ad will receive a commission of between 4%-12%. So, if the product they purchased was $100, that could be between $4 to $12.

However, if this person does not only buy the one product advertised but, for example, buys four more items, amounting to a total of $500, the publishing site then makes a total of $20 to $60.

Native ads work in a similar way to Google’s Adsense, in the sense that money is earned when a visitor clicks on a link display to purchase the product. However, Amazon’s Native ads are preferable for three main reasons:

1. Higher commission rate: Amazon offers the highest commission rate on the market for affiliate links of up to 12% of the purchase price.
2. It is fully customizable: as mentioned earlier, engaging appropriately with a target audience is an important tool for long-term success. Amazon’s Native Custom Ads allow the publisher to choose not only where the affiliate banner will be shown on a page, but also the exact products that are shown. This is beneficial not only because it is more likely to drive sales, but also because it helps to give a site some consistency, rather than visitors arriving through unrelated content.
3. The commission is not limited to displayed products: unlike many other affiliate programs, that will only offer commission for the exact product advertised, the Amazon program gives a percentage of the sales price for any purchase made through a link.

Choosing the Right Native Ad

Before getting into the precise details of how to set up Amazon Native Ads on a website, a business will need to choose the exact type of ad they are interested in displaying. Amazon Native Ads come in three different forms:

● Search Ads: this uses a specific phrase or category to generate an appropriate range of products that will be shown in the ad.

Choosing the Right Native Ad

● Recommendation Ads: this style of advertising will offer a product generated by Amazon’s systems that is classed as appropriate for the content of the website. It will offer the most general range of products.

Amazon Native Custom

● Custom Ads: This format allows for the largest amount of choice, as the website displaying the ads is able to pick the specific products that will be displayed in the ad.

Custom Ads

What Makes Custom Ads the Best Choice?

The fully customizable element of Custom Ads gives it an edge on the other formats, allowing for a smooth transition from content to ad that will produce the best visitor experience. Unrelated advertising, especially on platforms such as blogs, can often be very jarring, which makes the ability to tailor content and advertising around each other a useful tool.

Since the publisher is able to choose the most appropriate products for their target audience, the chances of purchase and, therefore, commission are much higher. For example, if a post is written on smartphones, a Custom Ad makes it possible to display the exact phones discussed in the post.

Step 1: The Amazon Affiliate Program

The first step is signing up for the Amazon Affiliate Program. Once on the site, click the ‘Join Now For Free’ button on the right-hand side of the page. On the next page, login with Amazon accounts details.

Amazon Affiliate Program

Then, it is time to fill out account information for payments to start using the associate account. The next step is to input the information of the website, app link, or YouTube channel that is going to publish the affiliate links. Then, click ‘next’ to fill out the rest of the profile. Finally, you will be directed to a page called the Amazon associate dashboard, which will display useful information such as a breakdown of monthly earnings and click-through rates.

Once signed up as a member of the affiliate program, it is time to create the code for the Amazon Native Ads.

Step 2: Creating the Code

Creating ad Code

On the Amazon Affiliate Dashboard, click on the product listing tab of the dropdown menu. Find ‘Create Ad Code’ (third from the top) and click on the arrow next to it; this will then display the three types of Amazon Native Ads. Select Custom Ads.

Step 3: Picking the Products

At this stage, the page displayed will be Native Custom Ad specific, which means it is now time to choose the products to be shown in the ad. To do this, head to the panel on the left-hand side of the page, which is titled ‘Your Ad Preferences,’ and look for the box that reads ‘Select and Add Products.’

Picking the Products

This box has a dropdown option that can be used to refine the search categories, e.g., to make only beauty, fashion, or technology products show up, which can be very useful if the search produces too many unrelated results.

Click on the search bar in this box and input the name of the products to be shown in the ad. Once the correct item has been found, click add and it will be shown in the ‘Preview’ on the right-hand side. Repeat this process until between four to eight products have been added.

Amazon recommends six products for these ads. While this is only a suggestion, it is good to bear in mind that a display of four products means that if one is no longer available, none of the images will show.

Step 4: Configuring the Ad

Next, it is time to choose the best format for the ad display. Above the product selection box is an option to change ad format, showing three different styles: ‘grid,’ ‘list,’ and ‘strip.’ These can be chosen based on personal preference: what you think will look best on the page. As a general rule, the ‘grid’ looks best when displaying four products, as more takes up the most space, especially when viewed on a mobile device. ‘List’ will show the product links but not the pictures, while ‘grid,’ which is the best option for mobile viewers, shows both the links and the product images in a suitable format.

Step 5: Copying the Code

Once the right products have been chosen and the preferred format selected, the next step is to copy the code. Below the ‘Ad Preview’ section is the box of code, with a button that reads, ‘Copy Ad Code.’ The simplest way of doing this is by clicking on the yellow button just below the box that reads ‘Highlight Code.’ This will save the code to the computer clipboard.

Step 6: Adding the Code

After the code has been copied, the next step is to go to the publishing website to input it. Choose where the ad is going to be displayed; for example, if the chosen products relate to the content’s subject matter, inputting the ad underneath the mention of the products is appropriate, whereas if the ad does not relate directly, Amazon recommends it is displayed at the end of the post. It says this is the most effective tactic to maximize conversions and sales.

Adding the Code

Once you have decided on the best place to display the ad, the next step is to input the code HTML. This step is really quite simple on most platforms; for example, on WordPress, click ‘add block,’ then ‘add custom HTML’ – then just copy and paste the link, and it’s all done.

Amazon Native Ads are one of the simplest ways of increasing revenue. The whole process of creating the code and inputting the data into the website will take no more than twenty minutes. Since the Custom Ad option allows the displayed products to be chosen to reflect the interests of the target market, it is also one of the subtler forms of affiliate advertisements.