Debating The Value of Amazon Advertising
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This panel discussion, "Debating The Value of Amazon Advertising," brought together experts from All Things Amazon, Kukoon Rugs, BDO Eaton Square, and Scholl's Wellness Company to assess the effectiveness of paid search in eCommerce. The session provided a comprehensive examination of the advantages and limitations of Amazon advertising.
Listen To The Full Session
Key Insights
Differing Views on Amazon Advertising
Paul Walsh: Paul Walsh, founder of All Things Amazon, argued against the common perception of Amazon advertising as a "friend" to sellers. He shared that his agency often limits ad spend due to diminishing returns, suggesting that the effectiveness of Amazon advertising decreases over time.
Amy Lynch: Amy Lynch, Global Senior eCommerce Manager at Scholl, countered Walsh’s point. She emphasised that advertising is a crucial investment area with significant impact on sales. However, she noted that successful campaigns require a long-term strategy.
The Role of Organic and Paid Advertising
Aftab Saleem: Aftab Saleem, managing director of an e-commerce consultancy, highlighted the synergy between organic and paid advertising on Amazon. He explained that advertising not only boosts immediate sales but also enhances reviews and visibility, which in turn improves organic rankings.
Ronan Kitson: Ronan Kitson, former Data Analyst at Kukoon Rugs, provided a retailer’s perspective. He focuses less on broad sponsored brand campaigns and more on targeted product advertising to achieve efficient returns.
Advertising Spend and Business Models
The panelists discussed varying views on the optimal advertising spend as a percentage of sales. The recommendations ranged from 2.5-5% to 10-15%, reflecting different business models and philosophies. This variance underscores the need for businesses to tailor their advertising strategies to their specific goals and contexts.
Short-term Gains vs Long-term Growth
Walsh concluded with a critical insight: unlike other growth strategies, the benefits of Amazon advertising diminish when spending is reduced. This makes it more effective for achieving short-term sales boosts rather than fostering long-term growth.
The panel offered a balanced view of Amazon advertising, highlighting its potential benefits while also cautioning against overreliance. For businesses navigating the complexities of eCommerce, these insights provide valuable guidance on leveraging Amazon advertising effectively.
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