Amazon’s US ad revenues are expected to double in the next couple of years, as B2C advertisers’ interest mounts. New data from Merkle indeed demonstrates surging investments in Amazon’s various ad formats, which are led by Sponsored Product Ads.
During the third quarter, advertisers allocated 82% of their total Amazon investments to Sponsored Product Ads. As Merkle points out, these are available to all sellers, whereas Product Display Ads (8% share of spend) may only be used by first-party sellers, and Headline Search Ads (10% share of spend) were only available to all as of August.
The report notes that most advertisers tracked for the report are using all three formats. In fact, quarter-over-quarter spending increases were highest for Product Display Ads (+112%) and Headline Search Ads (+63%). Even so, investments in Sponsored Product Ads grew by 52% from Q2, indicating that there’s plenty of growth for the favored format, too.
Which Ad Format Performs Best?
Interestingly, Headline Search Ads – which appear at the top of search results on the platform – have the highest click-through rates (CTRs). This particular format has a CTR that’s more than 4 times higher than the CTR for Sponsored Product Ads for the median advertiser.
Product Display Ads – which are shown below the buy box on product details pages – have a slightly higher CTR than Sponsored Product Ads, but again are far outpaced by Headline Search Ads.
While Sponsored Product Ads have the lowest click-through rates, they perform best where it counts: sales. For the median advertiser, these ads – displayed on the right rail and amidst search results – return a more than 40% higher sales per click than Headline Search Ads, and more than double the sales per click of Product Display Ads.
In recognition of the enormous influence Amazon is exerting in the retail marketplace, MarketingCharts, in partnership with Hitwise, a division of Connexity, is publishing the top weekly search terms and product pages on Amazon. This data is only available to newsletter subscribers (each Wednesday and Friday): please sign up here.
About the Data: Merkle describes its methodology as follows:
“Figures are derived from samples of Merkle clients who have worked with Merkle for each marketing channel. Where applicable, these samples are restricted to those clients who 1) have maintained active programs with Merkle for at least 19 months, 2) have not significantly changed their strategic objectives or product offerings, and 3) meet a minimum ad-spend threshold. All trended figures presented in this report represent same-site changes over the given time period. Unless otherwise specified, the data points in this report are derived from the North American market region.”