#15 - Amazon Advertising & the Platform’s Scaling Opportunities for eCom Brands w/ Destaney Wishon

In this new episode, we’re exploring the ever-growing and evolving landscape of Amazon advertising and marketing. Scott & Ray are joined by Destaney Wishon, Co-Founder and CEO of BetterAMS, to examine the trends seen in the Amazon marketplace over the last few years as both eCommerce and retailing converge, ushering in a new age of shopping for customers. 

Destaney goes into the nitty-gritty of running and scaling Amazon for brands - what the difference is between sponsored display ads vs. demand-side platform, the factors impacting ROI maximization on the platform, allocating budget in the platform when a lot of brands are competing for customer dollars & loyalty, and what are the fundamentals needed to amplify a brand’s Amazon strategy. 

Tune in as Scott, Ray, & Destaney also discuss which improvements and enhancements are being made on the platform and how brands can fit into the marketplace’s continued growth and expansion into the future.

For real-time updates, connect with Destaney: 

• Destaney Wishon on LinkedIn
• Destaney Wishon on Instagram
• BetterAMS Website
• BetterAMS on YouTube  

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Join our Growth & Greatness eCommerce group and connect with fellow business owners & digital marketers alike: Growth & Greatness eCommerce on Facebook 

If you want to learn more about us and what we do at Right Hook, visit our website: Right Hook Digital

Full episode transcript & chapter markers for this episode are available on the Growth & Greatness eCommerce Podcast Buzzsprout page!

Transcript

0:00 - 0:27 - G&G eCommerce Podcast Theme
This is the Growth & Greatness eCommerce Podcast, powered by Right Hook Digital, with your hosts Scott Seward & Raymond Johnston. If you’re an eCommerce brand founder, entrepreneur, or marketer looking to accelerate profitable growth for your business, then listen in ‘cause this is the podcast for you.

0:27 - 4:15 - Introduction of guest Destaney Wishon
Scott (0:27 - 0:35) - Welcome back to the Growth & Greatness eCommerce Podcast. I’m here with my co-host, Raymond Johnston, how are you? And we have a special guest. . 

Ray (0:35 - 0:44) - Doing great! In the thick of it, Black Friday, we’re trying to gear up how can we double our managed spend in one weekend so there’s a lot at stake right now. 

Scott (0:45 - 0:58) - There is, there is, it is crazy season. We’re going in a little bit of a different direction. We’ve got Ms. Destaney Wishon with us today. She is from BetterAMS, and we are talking everything Amazon advertising. Destaney, welcome!

Destaney (0:59 - 1:01) - Thank you so much for having me, really excited to be here!

Scott (1:01 - 1:41) - Yeah. This is a bit of a different area that, I think, a lot of people in our space are more in the direct response, social advertising space. Well, that’s been, very much, the focus for the last 5, 6 years because it’s been, I guess, the primary traffic source and easy place to spend your time and make a return on investment, but some changes in the last 12, 18 months have, probably, shifted people’s perspectives around platforms like Amazon, eBay, and these marketplace-type, you know, platforms. What are you seeing, at the moment, with the shift to people’s perspectives in terms of Amazon and Amazon advertising? 

Destaney (1:42 - 2:17) - Things have been crazy! I think, you know, all of COVID, in general, is such a large catalyst in people, not being forced to, but maybe being more comfortable with shifting to purchasing from Amazon or Walmart.com because they didn’t wanna step foot in stores, and then realizing, ‘Oh, wow, it’s pretty nice having everything delivered directly to your doors.’ We saw this major flood of, just, customers that were, you know, aware of the platform, but not fully trusting. With that, we saw a lot of Amazon advertising budgets, retail budgets, being shifted over, extended. It’s been insane. 

Scott (2:21 - 3:06) - It’s, the thing that I’ve found, I started on the brand side, right, we go back 10 years. For us, the primary platform in Australia, ‘cause Amazon wasn’t here at the time - eBay, Google Shopping, a lot of other CSE marketplaces - that kind of went away, I think, from about 2015 to 2020 ‘cause there was such a massive shift to social advertising, in particular. But then, also, a lot of brands, especially in the space we play with fashion, direct-to-consumer products, it felt like platforms like Amazon didn’t necessarily fit their, I guess, aspirational brand image. Is that something that you find? How do you tackle that discussion?

Destaney (3:07 - 4:15) - Definitely, especially, more so 2 - 3 years ago, Amazon didn’t allow you to have brand assets, you know. You couldn’t have a gorgeous store page that matched your aesthetic, matched your brand goals. I think there was a, maybe, misconception now that Amazon actually devalued your brand as well due to price matching, all of these different factors that made you feel like you were out of control, and it didn’t have a lot of margin, which, the margin aspect is still true. In order to hit those 24-hour turnarounds in shipping, you know, Amazon’s gotta make some money off you. But, what really has to be considered is economies of scale - you are putting your product in front of consumers that only want to purchase. They don’t come to Amazon and type in, you know, ‘red t-shirt’ because they want to see every option out there, every YouTube video, every vlog about red t-shirts. They come to look for a red t-shirt because they wanna purchase. I think that high purchase intent has helped, maybe, shift people’s perspective, and then Amazon releasing new assets for brand guidelines, allowing to have a video under your listing, to control your brand registries so you don’t have knock-off sellers, and then, even just telling more of your brand story with better content, better copy, things like that.

4:16 - 7:35 - New additions and features to Amazon advertising
Scott (4:16 - 4:39) - Yeah, I think that’s something that we definitely saw, Ray & I, when looking into this, probably, going back 6 months ago now when we were talking to a friend of ours, and he was showing us through the stores, and there’s so much more from a brand perspective that you can do there. What are some of the features and, you know, additions to the platform that you’re most excited about for brands, being able to convey themselves and not just sell a product? 

Destaney (4:40 - 5:29) - Yeah, I think the store page assets are absolutely amazing. I personally don’t think it’s that easy to navigate as a customer, unless you’re very familiar with Amazon, it’s not easy to find the store page. I think they’re gonna improve upon that. From the advertising side, we’re now able to advertise lifestyle images and videos, which is huge because that’s never been provided so I’ve never been able to influence conversion rate until now. Now, I can add an amazing creative to tell that brand story and then put paid ads behind that. I think having, just, videos on the listing has been huge. And then, small things that are really new, like, not Instagram Lives, but having Amazon Lives that are very similar where you’d see elsewhere having social posts in a feed is gonna be a really good direction. You know, anytime Amazon sees anyone making money or monetizing anything, they’re like, ‘Yup, gotta do that with my other platforms’ so we can make big bucks in those other areas. 

Ray (5:29 - 5:47) - I was gonna ask you about that ‘cause I saw a recent update, same thing with the Live posting and, me shopping for, like, a webcam, for example, I saw people going on Live like, what the heck is this? Of the things that you listed, I‘m really curious - what are some of the ones that you’ve seen really make up a significant difference in the conversion rates from those pages? 

Destaney (5:48 - 6:44) - So the biggest things that really influence the conversion rate are some of the store page assets and, directly on the listing, being able to add a video or have nice content. Lives are amazing but, at the end of the day, you know, when you run a Facebook ad, you can have a beautiful creative, influence the conversion rate of the product you’re selling. On Amazon, it’s a lot more complex ‘cause almost all of that traffic is being driven to your product detail page. So, if I run an Amazon post, that traffic’s being directed to a product page, so the product page is still what influences that conversion rate, but Amazon posts are basing because they’re free, so all those placements you see directly under a competitor’s product detail page, it’s free placement right now. Amazon’s just beta testing this so that’s been amazing. On the Live side, it’s been pretty cool ‘cause if you partner with the right influencers, you’re able to cross-sell multiple products from within your product line. Amazon’s paid influencers are getting a really, really high number of views so it’s been a great brand awareness strategy. 

Ray (6:44 - 7:05) - One thing I thought, and I’d love to get your opinion on it is, I’ve noticed a lot of, on product pages, you mentioned influencers, partnering with the right influencers, them doing a review and Amazon, kinda, featuring that in the reviews section. I’d love to hear, like, is that something that is added automatically, or how do you orchestrate that on the back-side for the brand? 

Destaney (7:05 - 7:32) - So, really, it’s connecting with your audience. All the things that are directly below the, kind of, sponsored products related to, those are truly uploaded directly from customers. You can’t necessarily, you can’t game that system, Amazon has a lot of control over it. Now, some of the Lives that are being pulled directly below, it’s just connecting with influencers, and then having your product, they’ll know your ASIN (Amazon Standard Identification Number), your SKU, and it’ll tie it to that page. 

Ray (7:33 - 7:35) - That’s really cool.

7:36 - 10:41 - Brand-customer interaction & store management on the Amazon platform
Scott (7:36 - 7:49) - I think, one of the concerns in the past has been, do you have very little control over the interaction with the customer once you acquire a customer? Has there been any changes in that space within that platform? 

Destaney (7:50 - 8:33) - Not really. So you still don’t own a lot of the data; on the vendor side, Amazon’s rolling out small tools where you can potentially email your followers. Anyone who follows your store, you can send them an email, but it’s still a templated email, so not really fantastic. There’s not a lot of control over that. It’s, kind of, looking at that symbiotic relationship of how do you drive that brand awareness? That’s what Amazon should be viewed as. It’s the way to connect with customers, new to the brand, get them into your funnel, build them into your subscriber base, and ideally, take them DTC ‘cause they love your products so much, you have such a great unboxing experience, like ‘Hey, I need to follow this person on social. I need to check out their website.’ That’s kinda how it has to be viewed.

Scott (8:33 - 9:16) - Nice. With that, do you see that that has an impact on, say, they go to a Shopify store, do you think it has an impact on that side? Do you think that there’s, you know, a certain pricing strategy that you should use between the two to make, you know, maybe, make it more enticing to go to the Shopify store? A lot of the time, people will buy from Amazon but, as a brand, you wanna own that customer, you wanna build that list. If you’ve got that same price, people will go to Amazon Prime, that seems like a good safety net for them and they’ll often take that option when, you know, for the most part, you wanna drive them to your store that you own. Do you have any recommendations around, you know, strategies there with pricing? 

Destaney (9:16 - 9:50) - Not necessarily pricing because Amazon’s getting very specific on price matching all of their platforms. They want to be the lowest, or the equal, provider across all things. But, where we have seen opportunities is selling different SKUs on your Shopify site, especially, once that, maybe you don’t have to tie your margin on so you wanna put them over there, or bundling, having some form of add-on that you’re not giving to your Amazon customers. So, maybe you have your highest volume product on Amazon, gets the best reviews, best conversion, and then you can drive them to your site where you have other products to keep them in your funnel. 

Ray (9:51 - 10:05) - Does Amazon, they get pretty greedy if they see a best-seller selling better on your store? Like, will they get upset if, like, they know that you’re using, like, a lower-priced item for the eyeballs, but they see the better item on your store? Will they ever try to grab that? 

Destaney (10:05 - 10:37) - I can see them in the long-term, saying, ‘Hey, there’s a discrepancy in the SKUs you have here,’ but I don’t think they have the capacity to keep up with it right now. Amazon likes to outsource anything and everything, and that’s what makes it so complicated. If you’re selling on Amazon, I mean, you have to control your SEO, title, imagery, your videos, all of these assets, completely in your control to manage so I don’t know if they have to scope to keep up with that, but I could see… we may need to mute this, make sure no one from Amazon hears this, otherwise we may have some issues. 

Scott (10:37 - 10:41) - They got the money behind them to develop that, I’m sure, if they want to. 

Destaney (10:40 - 10:41) - Yes, yes. 

10:43 - 14:40 - Sponsored display ads vs. DSP (demand-side platform)
Scott (10:43 - 11:05) - Let’s dive a little bit more into the advertising side. You spoke about, you know, using Amazon as a platform to build brand awareness. How are you leveraging that, you know, I guess, with Amazon, at the moment, some of the different areas within the platform if we’re looking at sponsored display versus the DSP, demand-side? What does that look and how are you using that to amplify brands?

Destaney (11:05 - 12:14) - That’s a fantastic question. So, Amazon has more data than a lot of people realize, especially on the brand side. Amazon tracks, pulls everything; you just may not actually see it. So, that’s what’s really cool about DSP is you’re actually given insights into a lot of the data that Amazon has to make more informed decisions ‘cause it is much more complex of an ad type. Sponsored display’s a great way to dip your toes in if you’re not up for the minimums in terms of the spend. We’ve been playing around with a lot of sponsored display ‘cause it’s allowing us to build more audiences and move up the funnel. For those who aren’t aware, the main targeting types in Amazon are keyword targeting and product targeting, so it’s actually super simple. I’d say, ‘Hey, I wanna show up under ChapStick,’ or ‘Hey, I wanna show up under Carmex,’ very, very simple. As you get into DSP, you can start driving more of that broad, upper-funnel awareness of ‘Hey, I wanna target everyone who has been searching, you know, winter gear,’ things like that where you may have some form of a correlation. That’s how we’ve been playing with both, just making sure that we’re managing the targeting of both bottom-of-the-funnel, high customer intent, but more brand awareness and going out & getting those customers rather than waiting for them to come to us. 

Ray (12:14 - 12:43) - I love nerding out about the keyword stuff ‘cause I’m a former Google keyword strategist myself. With Amazon, there’s so much competition, I really wanna ask you this question, especially with new people coming unto the scene, even tougher, right? There’s hundreds of the same products that you sell. How has your strategy changed now, obviously, you’re not going, like, completely broad, you’re going long-tail. How do you look at it now to try to get them the revenue ‘cause that’s what’s important, the cash flow, and then, eventually, that opens up other opportunities?

Destaney (12:44 - 13:57) - Yeah, I think you hit the nail on the head. You really have to go a lot longer-tail. You have to look at every single product you may have a competitive advantage of, and know that your impressions won’t be as high ‘cause their volume may not be as high if you’re showing up directly below their product detail page, or you have to find those keywords that are not as competitive. Everyone knows to bid on ChapStick. Now, will anyone bid on, you know, sunscreen, peppermint Carmex? Probably not. That being said, it’s a very large education aspect of making sure someone knows that, if you’re going long-tail, your volume’s gonna be a lot less and it’s gonna be very incremental, it’s gonna be a long-term play, versus if I’m bidding on ChapStick, we know very well that it’s gonna have an incredibly high search volume. I’m gonna be able to drive a ton of, you know, opportunity and volume upfront. So my job, I feel like, has shifted much more into strategizing into educating on why. Amazon advertising used to be a money machine, like no one was competing on the platform. You can get a very, like, $4 to $5 dollar return on almost everything. Now, it’s like, ‘Hey, this isn’t realistic. We’re shifting to this model of running ads as a traditional marketing budget, rather than a profitable money-maker.’

Scott (13:57 - 14:02) - Do you find that the approach now is, really, trying to strike that balance between ROI and volume?  

Destaney (14:02 - 14:40) - Yes, exactly, definitely. I think one of the easiest ways to explain Amazon advertising is someone saying, ‘Hey, type any keyword onto the platform.’ The first thing you’re gonna see is a sponsored brand headline search ad, directly below it, you’re gonna see 4 sponsored product placements. Below that, you’re finally gonna see 4 organic placements. If you’re paying for an end cap, or any beautiful creative and external marketing, you should probably be paying for, at least, some form of this presence because it’s the number 1 purchasing platform and you know it’s the highest purchase intent. It’s simple in that aspect. 

14:41 - 17:32 - Factors impacting ROI maximization on Amazon
Scott (14:41 - 15:06) - What do you think are the commonalities between, obviously, conversion rates are a massive part of it as to how successful it is. You’ve got no control over the landing page, that’s standard. What do you think the commonalities are between the brands that are most successful with Amazon advertising, because that’s largely gonna be driven by conversion rate... What do you see are the contributing factors there that really, really impact to maximize ROI?

Destaney (15:06 - 15:57) - You know, I’m saying all of the ad types because Amazon has changed so much in the last 4 years. I mean, we have gotten to the point of having the ability to add lifestyle images, creatives, ad copy, to target categories, audience insights, run remarketing - all of these factors that people aren’t aware of. We can even make adjustments based off placements on page, which we never really do before. The advertisers that are, you know, doing the best are the ones that are taking advantage of everything because it is pay to play once you start getting to the top of search and high volume keywords. If you’re able to diversify your spend across ad types, keywords, and products, I think that is a really big competitive advantage and the secondary advantage, just picking the right products to advertise and making sure that your listing is optimized to the point where you have the highest possible conversion rate so, when you drive that traffic, it converts.

Ray (15:57 - 16:04) - Is it even possible to, just, be organic anymore, or is it strictly pay to play to be successful?

Destaney (16:04 - 16:32) - If you’re in the top 4, I would say it could be argued. But if you’re not in the top 4, directly below the top 4, you have, typically, editorial recommendations or highly-rated sponsored products. Directly below that, you have video in-search ad, and then you have 5 through 8. So, if you’re not in the top 4, you’re truly showing up on the second half of the scroll, like, you’re not getting a ton of visibility so you can compete, but you’re not driving high volume. 

Scott (16:32 - 16:40) - Does the advertising component support the organic here? Does that help boost your organic rankings?

Destaney (16:40 - 17:32) - It does. Now, this is a very hot topic in the industry, especially in the last 2 weeks, Amazon has recently released new guidelines to what is and is not allowed, and one of the things Amazon really doesn’t like is ranking manipulation. So, as with any platform, you know, they wanna have trusted organic listings. That being said, Amazon’s, you know, top revenue driver is advertising so anytime you spend a very high amount on a keyword, and then convert incredibly well with that keyword, you’re telling the algorithm that your product deserves to be organically ranked for, you know, that keyword. Now, how much that’s weighted versus organic traffic, or versus Google traffic, is still kind of up in the air, it changes pretty consistently, but yes, spending money on Amazon ads does improve your organic rank.

17:33 - 21:58 - Metrics to consider for ranking
Ray (17:33 - 17:53) - It’s funny you say that. I was, there’s 2 brands I’m thinking of in my mind, where they’ve noticed that SEO with Amazon is so much more potent and powerful than their own organic rankings that they’ve shifted their SEO strategy to pay advertising dollars to send to the Amazon page to increase that traffic and conversion rate, to rank better in SEO! What are your thoughts on that? 

Destaney (17:53 - 18:02) - I don’t have much, I don’t have a lot of education on that space so I don’t think I’ll be able to provide anything too insightful.  

Ray (18:02 - 18:12) - Well, Amazon, obviously, conversion rate is probably key, but what other soft metrics or factors do they take into account for ranking? Is it views, is it time spent on page, what is it?

Destaney (18:12 - 19:06) - This is probably, again, one of the hottest topics on Amazon. So, a few of the big things are driving external traffic, that’s something that they do really much like. Right now, they’re giving a rebate for any form of external traffic driven, and they have Amazon attribution built out where you can build attribution links for your social traffic, for your Google traffic. The biggest thing is, if you take any one keyword and drive a ton of traffic to it, regardless of the source, and then it converts well, that’s what influences the algorithm in the long run. You know, back in the old days, you can run a giveaway, you can discount your product, run a 50% off Facebook ad, give everyone a coupon, drive them to a URL, you’d be ranked on page one within 10 hours. Now, Amazon’s understood that that’s ranking manipulation. They’re kind of looking at those fundamental sources that actually say, ‘Hey, this is a good customer experience, and algorithmically, this makes sense.’

Scott (19:06 - 19:25) - That component’s always been the challenge for people wanting to drive external traffic, is the tracking component. What are your best approaches to, ‘cause it’s really hard to determine the ROI, you know, coming from Facebook to Amazon. How do you see that whole conundrum?

Destaney (19:25 - 19:59) - It is a huge area of improvement and huge area of focus for Amazon. So, they currently went on a whole UI upgrade for their advertising console, they bundled in attribution now, so you can build that attribution campaign, all from the same ad console. I’ve heard mixed results from pretty much everything we’ve seen, but at the end of the day, Amazon knows that in order for people to drive more external traffic to the platform, they have to be able to track it, so it’s a win-win for them to build this out and to invest more into it. I think they’re really gonna hit that hard this year, well, next year. 

Ray (19:59 - 20:03) - What are some of the attribution models that they use? I’m really curious. 

Destaney (20:04 - 20:12) - So, on the advertising side, it’s all pretty much all last-click. Across their DSP, across sponsored ads, last-click attribution. 

Ray (20:12 - 20:39) - So, off the back of that, one question I’ve been dying to ask you is, since you work with big brands, I’m sure, and so they take into account, obviously, total marketing dollars spent, total sales, and you get, in our space, we use the term MER. I’d love to hear, how is your strategy when you guys, for example, Black Friday, we’re in the middle of Black Friday, you guys have your own plan, your own campaigns, your own scaling KPIs you wanna hit. How do you take that into account, the overall business, and not just, like, Amazon-specific?

Destaney (20:40 - 21:58) - So, it’s really depending on whether or not it’s a consumable. I feel like that’s one of the biggest factors that we’ve been looking into is lifetime value. Something we’ve seen on Amazon is, on the big deal days, everyone now knows to purchase on Black Friday/Cyber Monday on Amazon. For supplements, per se, instead of buying their regular scheduled protein, they just wait and buy 7 of them on Black Friday/Cyber Monday. We just sell everything at an incredible discount and then, maybe, take a loss later on. That’s something we’ve been shifting and, kind of, playing around with, as whether or not there’s value there. But, at the end of the day, we’ve been trying to work with just incremental sales lifts, pulling retail data, and then making adjustments based off that. There is quite a bit of attribution, we’re spending more on Amazon and driving volume on Amazon, especially when, you can make new-to-brand assumptions, I think it’s one of the best aspects. For example, I don’t know, what’s a big brand name? Johnson & Johnson - if someone types in Johnson & Johnson product, you know they’re not new-to-brand, right? They’d type the product. But if someone types in bath soap, they didn’t have that purchase intent. I think that’s where we’ve been able to make some of those assumptions on what’s new-to-brand versus branded, and then help focus on shifting budgets that way because we have seen in-store increases from driving new-to-brand on Amazon.

21:59 - 24:21 - Budget allocation & optimization
Ray (21:59 - 22:14) - This is gonna get tactical, but do you guys, when you’re thinking about a brand, do you try to allocate certain parts of your budget to different types of, like, broad, long-tail keywords? Do you guys have a healthy distribution that you’re trying to have? 

Destaney (22:14 - 23:18) - Yeah, across the board, 100%. Again, that brand versus non-brand is such a big subject ‘cause, traditionally, the easiest thing for a large enterprise, company C-Suite team to say is, ‘Hey, I typed in my brand name. Why am I seeing, like, if I’m Coke, or if you’re Pepsi, you almost always see Coke bidding on that brand name.’ I feel like it’s so easy for C-Suite to be like, ‘It’s a $10 dollar return, only bid on my brand name.’ In reality, again, if they’re typing in your brand name, they were probably gonna purchase so is that the most efficient way to actually grow your topline? Probably not. We look at shifting those budgets over, and then the next step is breaking down the ranking keywords. So, whether or not our cost per acquisition is healthy on those high-volume keywords, so, there’s usually 5 to 10 keywords that drive the majority of traffic and you wanna look at and say, ‘Hey, how expensive are these?’ If I’m bidding $20 on this keyword, maybe I should shift my budget elsewhere, really focus on long-term or competitor acquisition is a really good one ‘cause you can run ads directly under your competitors’ product detail page, those types of strategies.

Scott (23:18 - 23:35) - Do you view that budget distribution, almost in a similar fashion to what we would with social? Top-of-funnel, 70%, 20%, 30% - combined middle & retargeting. Do you, kind of, view the keywords in that type of approach and balance it out from there to your overall targets? 

Destaney (23:35 - 24:21) - Yeah, pretty much exactly. Where it’s a little bit different is, once you start getting Sponsored Display, DSP, everything on the keyword and product, you can make assumptions that’s pretty bottom-of-the-funnel, ‘cause Amazon won’t allow you to go that broad. Again, if I’m ChapStick, if I was bidding on backpack, I wouldn’t show up; even though correlation could be made that high schoolers buy a new backpack, do you want ChapStick, they won’t allow you to run sponsored product or sponsored branding in a lot of volume, ‘cause they’re saying your relevancy’s off. That keeps everything pretty bottom-of-the-funnel, maybe slightly mid-funnel, if you get up to, like, dry skin, you can maybe run with that. Although sponsored display, DSP side, we can start targeting those customers so that’s where we have to, kind of, distribute our budget a little bit more efficiently in the funnel. 

24:21 - 28:43 - Creative's overall impact on performance and brand control
Scott (24:21 - 24:24) - I’ve got a potentially really dumb question. 

Destaney (24:23 - 24:25) - No such thing. 

Scott (24:29 - 24:54) - Obviously, we’re social, and that side, creative is king, really. It’s the biggest lever we have to pull on that platform. How much impact do you see creative having on ad performance, and how much control do you have over that, especially, you know, looking at different buying intents and things like that. We really mix that up and try and cater to that. Do you have that type of capability with the Amazon platform?

Destaney (24:54 - 25:42) - Finally, we are slowly getting more creative control, but these are all updates that pretty much happened in the last 12 - 14 months. So, for example, if you look at the headline ad immediately on Amazon search, we can now add a lifestyle image to that actual ad and it’s just a regular banner ad with a lifestyle image so we’ve been able to play around with that, still being beta tested across browsers and mobile and desktop, but we’ve seen upwards of 400 and 500% increase in click-through rate because the ads for them just take up a pretty large part of the page. We can also write copy with the headline search ad, but it’s less than 50 characters so you can’t get too creative. And then, on the sponsored display DSP side, there’s a lot more opportunity because you have more custom creatives and advertise those on a larger scale. 

Scott (25:43 - 25:48) - It’s awesome! There’s a lot of development happening in the platform over the last couple of years, right?

Destaney (25:47 - 25:50) - Yes! It’s been crazy. 

Ray (25:51 - 25:58) - So it sounds like the image and the headline of the product is probably the biggest lever you have for your advertising success, is that correct? 

Destaney (25:58 - 26:00) - Yeah, 100%. 

Ray (26:00 - 26:35) - I wanna ask you something that I’ve heard, and maybe I can tell you where I heard this. It’s like a really great conspiracy theory to bring up on the podcast. Okay, so I was talking to a brand - obviously, Amazon has rules on a white background for your products, is that correct? That’s kinda like their rule, so it’s standard. I was talking to a brand and they will stage the product on a white setting, but add elements to the product setting. So, for example, imagine a lotion that has coco, they’ll add the product with coco leaves in the real picture at the bottom to stand out. Is that grey hat, like it’s flying under the radar, or is that legitimate?

Destaney (26:37 - 27:00) - I would say it’s grey hat, but Amazon is very well-known for not having white background images on their own products. If you type in, like, a lot of the Alexa products, look at some of their stuff, you’ll see a creative image that has an infographic behind it. So, not a lot of regulation unless, you know, you get negative feedback and, like, ‘Now, you’re under speculation. This needs to change.’ 

Ray (27:00 - 27:05) - I hope Zoom isn’t hosted by AWS. Amazon…

Destaney (27:04 - 27:05) - Shut down!

Ray (27:06 - 27:39) - Another question, I heard this, a business where they bought an Amazon business, and maybe I’ll tell you this offline, and they were looking at their products amongst their competitors. And I wanna get your thoughts on this because what they did was, their way of trying to stand out besides image and product, ‘Let’s just change the color of the product.’ It was, like, all-white and all-brown, products of their competitors, so they took their product, made it bright orange, and they said it was enough of a variable to make them a success. Have you heard of that happening? Is that commonplace where you can, how can we change the packaging of the product to stand out?

Destaney (27:39 - 28:43) - 100%. That’s why we’re finally seeing a shift in the industry. So, I’m of the belief that Amazon started and they had to be the anything & everything store, and the true, you know, third-party marketplace because they needed high volume of products. The customers go into Walmart and Target, you have limited shelf space, you have 12 toothbrushes, and it’s typically vetted by the buyer, maybe the best 12 toothbrushes. Amazon got started and, now, you have options of, like, 50 - 60 whatever damn toothbrush you ever wanted. So, you know, they got the customer loyalty, got the high volume, and now they’re realizing, ‘Oh, my customers don’t need 70 different knock-off products with slight variations. They truly need to focus on the best product, the one who’s able to build the best product to best serve their audience.’ I think that’s why we’re slowly shifting to this brand focus. Amazon started getting returns because people are knocking off products, making slight changes, but doing it poorly through their manufacturing. It’s like, ‘Ooh, I need to focus on people, legitimacy, enough money to make the right changes, and the better products.’

28:45 - 30:29 - The fundamentals needed to start amplifying their Amazon advertising strategy
Scott (28:45 - 29:22) - The brands that are looking, that aren’t on Amazon at the moment, and they’re looking at Amazon going, there’s an opportunity to enter a platform where I’ve got a bit more control over my costs because social’s all over the place, it’s very up and down at the moment and a tough space to play. Google can be a little bit the same, but it’s probably a bit more stable, but really, like these platforms, I think there’s a place to build a bit of stability in your revenue because you’ve got control over the costs, they’re fairly consistent. Where do you suggest people start, especially if they’re looking at the advertising side to amplify it? What are the basics that they need to do to keep moving? 

Destaney (29:23 - 30:29) - I think just a basic understanding of pay per click, not trying to do anything and everything. I think the absolute beauty of Amazon is the simplicity of your targeting. If you know exactly what your product is, you can create a campaign, bid on it in exact match, and then analyze your costs within 24 hours. If you’re getting clicks and traffic, you can say, ‘Hey, this keyword’s gonna cost me $2 - $3 if I wanted to be at the top of the page. I’m converting at a 10%, and then you can just work backwards mathematically.’ On the flip side, if you go in there and you upload 300 - 400 keywords and you don’t know what you’re doing, you’re gonna spend a lot of money really, really fast, and then you’re gonna stress out and say this isn’t for me. So, one of the best things is find the resources and the people in the space. There’s so much free content on YouTube and on blogs and things like this. Then you can kinda start getting acclimated to the platform, but I will say that you don’t need a $100,000 to launch an advertising campaign on Amazon. You could start with $5 if you really wanted to. It will take some time to collect data, but there’s no minimums.

30:31 - 34:15 - What's on the horizon for the Amazon space in 2022 and beyond?
Ray (30:31 - 30:38) - Is there an opportunity in 2022 that you’re the most excited about, or you think is the biggest opportunity in the Amazon space?

Destaney (30:40 - 31:25) - Creative is such a large opportunity. I think top of search is becoming so much more pay to play, so a lot of people are becoming more familiar and there’s changes to ranking policy and things like that. So being able to creatively tell your brand story, I’m really excited about. We’ve never had that! So, the fact that I can run lifestyle images ads with sponsored display, and you can look and see, ‘Hey, this is my actual brand,’ or pull content from Instagram & social and put them on my store page, those are the aspects that are really exciting. I think people who truly value audience-building and building something that aligns with a certain personality type, I think those are the people that are gonna win in the end, rather than the people who are adding, you know, slight differentiation to color and like, ‘Hey, I’m just trying to churn and burn products. When this ends, I’m done.’ 

Ray (31:25 - 31:40) - Yeah, that’s a lot of drop-shippers, isn’t it? ‘Cause, I’ve, Amazon’s really been cracking down, haven’t they, with product quality. How fast will they ban your account if you have a bad experience or it gets so many bad reviews?

Destaney (31:40 - 32:32) - Pretty quickly. I think it’s still, the more volume you’re doing, you know, the quicker you’re gonna get caught when you make those types of mistakes, but they’re really focusing on the customer experience. I think that drives a lot of the decisions that make sellers unhappy, ‘cause it does. It makes it a lot harder for the seller, and we have all of these regulations. I mean, right now, there’s a lot of shipping guidelines. You can only send in so many units because they don’t want to get so overwhelmed that, then, the customer has to wait 3 extra days for their products. I think a lot of people see all these negatives, and they start stressing about selling on the platform, but if you always keep in mind and frame it that Amazon’s trying to do what’s in the best interest of their customers, that helps your trust because you know, at the end of the day, we’re all trying to make our customers happy. I think if you understand that, you can see the correlation of Amazon’s strategic moves, it makes it a little bit more of a trustworthy process.

Scott (32:32 - 33:14) - Do you think, when COVID occurred, and this is just an observation, I don’t know whether this is accurate or not. There seems to be a bit of a mindset shift within Amazon that they would shift focus to giving brands more branded exposure with the stores and that side. Do you think that was what the trigger was, given the fact that there were so many issues and people were looking for other platforms, but the hesitancy from brands was that, ‘Oh, Amazon’s just gonna swipe my products and sell it for themselves.’ That was, obviously, one of the things floating around in the back of a lot of people’s minds. Do you think, because it seems like there’s been a shift to give more weight to brands and what that was in the previous years. What do you think instigated that?

Destaney (33:14 - 34:07) - I do think that’s, a really large part of that is they probably saw a shift of vendors backs against the wall, store’s, you know, foot traffic dropping and retail, ‘let’s shift our budgets this way.’ Amazon’s like, ‘Oh, man, we finally got all these budgets that we’ve been looking for. Now, we need to figure out how to take care of them.’ I think that was the big aspect. I think another part that’s a little bit under-branded is their relationship and competition with Walmart. Walmart was successful because they had every single large vendor relation, for the most part, and they were able to drive those high volumes with an incremental amount of brands whereas Amazon’s strategy is high volume with a lot of brands. So, I think they’re trying to, like, look and see a little bit of what that is and manipulate some of those aspects of it. You have to have the large brands on your platform; you already have that trust from being in-store so they need to be able to maneuver directly to dot com. 

Scott (34:08 - 34:12) - It’s actually Amazon being able to leverage their brand credibility with the bigger brands, right? 

Destaney (34:11 - 34:12) - Yes! 

Scott (34:13 - 34:15) - It’s a very, very good dynamic to have between them. 

34:17 - 38:45 - Improvements and enhancements made on the Amazon platform   Scott (34:17 - 34:42) - Next year, you know, this is probably, we’ve gone from 2020, potentially, being the easiest year in eCommerce, after the initial bumps in the road, to this year, particularly in the paid advertising side - social, Google, with all the updates from Apple. Where do you see it heading next year, improvements in the platform, and just the importance of Amazon as a platform in 2022 and beyond?

Destaney (34:42 - 35:53) - I’m really, really excited. I feel, like, we’re just at the peak of what’s possible. I see Walmart and Amazon running hand in hand, it’s not necessarily one or the other. I think customers want a lot of options due to ease and movability. I think, on the advertising side, programmatic DSP is going to be even more important ‘cause we’re gonna wanna leverage all of Amazon’s shopper habits, all of the AI that they’re building out within that platform, we’re gonna wanna take advantage of it and Amazon’s gonna want us to take advantage of because search is more pay to play. When all of your volume is, pretty much, on the top of search, all your visibility, it’s gonna come to the ones who paid the most ad placements. They’re gonna need to diversify those ad costs somewhere, and I think that’s where DSP is really gonna make a difference. That being said, DSP requires a lot of education. A lot of people don’t understand the differences between the two and the different expectations. I’m really excited to just educate the market. I think, fundamentally, there’s such a shortage in thought leaders in the space and I think there’s so much opportunity for things like this to really drive home that value of why you need search, why you need DSP and programmatic, so that’s what I’m most excited about.

Scott (35:54 - 36:10) - It’s such an ignored avenue! Everything’s so social-driven because that’s the sexy space to play in, the place of fast scalability. There’s so many other platforms, like Amazon, that have just been neglected for the last 5 years. 

Destaney (36:10 - 36:12) - Exactly, 100%. 

Ray (36:14 - 36:23) - You mentioned programmatic. Amazon Prime, I’ve seen some ads on there. What’s the word on the street? Like, is that gonna be available to all brands eventually, or just big brands? 

Destaney (36:24 - 37:07) - I think that a lot of their, kind of, premium advertising is going to be rolled out. I’ve seen things where OTT, maybe, rolled out on a self-serve model, which I think is a little bit far-fetched because no one wants a terrible Amazon video ad being ran on their Fire TV. I don’t know how I’d feel about a PowerPoint slideshow commercial, but I do believe that a lot of those assets are gonna be rolled out and given at a lower levels so agencies who have DSP have a lot of opportunities to play around with a lot of those aspects and they don’t have too much regulation, other than the typical bots. So, yes, I think all of those opportunities are gonna be opened up.

Ray (37:07 - 37:31) - That’s really exciting! I wanna ask you one last question from my side is, to see so many mental blocks people have with Amazon, they think about it as, like, the savior or, like, the thing that’s gonna fix it or scale it or whatever. What would you say are some of the most critical mindsets that brands have to have if they’re moving on to Amazon? Maybe corrective mindsets ‘cause they may have the wrong mindset. 

Destaney (37:31 - 38:45) - It’s a long-term play, it’s probably one of the biggest ones. As with anything, eCommerce, in general, I think is so much more complex than what retail used to be. If you think, like, 20 years ago, location, location, location. That’s what mattered - you set up a storefront, you build relationships, you, you know, had suppliers and buyers, things like that, it’s complex, but that was it. Nowadays, just to have a brand, it’s like, ‘Hey, I need to have an email, I need to have social presence. I still need to have all the back-end, manufacturing, creation. If you go to Amazon, I need to have SEO, I need to have advertising on-platform, off-platform.’ There’s so many layers and, I think, people kinda see Amazon as, like, the quick fix because it is driving so much volume, but again, it’s just hours in the day. So you have to fully have a team to manage it appropriately. You need to understand the fundamentals of how to get ranked. Once you do that, you need to know that that’s gonna take you a lot of time because you’re competing against so many other brands that have been driving velocity. You have to match that to get to page 1 and, in order to do that, you need to drive a ton of traffic, which can be really costly and you can do it really quickly, or you can do it slowly overtime, which is a little bit more affordable.

38:48 - 41:53 - Updates on FBA (Fulfilled by Amazon) and FBM (Fulfilled by Merchant) logistics
Scott (38:48 - 39:24) - I’ve got one last question, maybe another dumb one. I used to have my own brand here and I shipped stock to the US, ran it through Amazon, and used FBA at the time. There was, obviously, a lot of advantages in costs, running, you know, having a stock and inventory with FBA, running ads that way - the efficiency’s there. Is that still the case, and do most brands do that? Do they have some amount with FBA, or do they, are they shipping things out themselves, just from an inventory and logistical standpoint? What does that look like with advertisers at the moment? 

Destaney (39:24 - 39:35) - I would say 80% of our brands are still fulfilled by Amazon. The reason being is, the conversion rate tied to that Prime badge is enough to make it worthwhile.

Scott (39:35 - 39:39) - So you have to be with FBA to have a Prime badge?

Destaney (39:39 - 40:31) - You can have seller fulfillment by Prime, but that comes with its own complications. We do have, that was the biggest issue of COVID, right, is there are so many supply chain issues and then Amazon put these ridiculous inventory limitations in. A lot of people transitioned to fulfilled by merchant, and it was a good quick fix solution, but what we ran into issues with, we have all these campaigns set up that drive traffic to a specific ASIN. The moment we switch to FBM, all of our historical campaigns that were built off this conversion rate data and cost-per-click data, we see conversion rates drop, quite a bit. Now, it’s dependent on category; furniture, large products - everyone’s used to having FBM or long shipping times. But, for anything that they’re used to, ‘Hey, I need this tomorrow,’ the conversion rates would drop, which would affect all of our campaign performance because now we’re having too many, completely different bid base optimizations. 

Scott (40:32 - 40:56) - Yeah, it sounds like there’s definitely some advantages there. There was a massive difference between Australia and the US. The shipping costs in Australia are so expensive, but Amazon in the US, I remember when I was comparing them, it was like $15 for me to ship a towel where it was $4 with FBA, at the time, in the US. It was such a difference with the infrastructure that they’ve built over there. I know that they’re working on that in Australia. Hopefully, that keeps coming… 

Destaney (40:55 - 40:57) - Getting there! 

Scott (40:57 - 41:30) - We can do with some competition in the logistics space and I don’t think that would hurt. It’s been an amazing call, a lot of insightful information. I’m really excited about this platform going forward. I think, it’s crazy to almost say that it should be making a comeback because it should never have gone anywhere. It just hasn’t had enough exposure. You’re in a prime seat. Going forward, I think it’s gonna be an amazing platform for users to keep growing. Destaney, thank you so much! Any last words for our listeners out there and just let us know where people can find you if they wanna get some more information?

Destaney (41:30 - 41:44) - Yeah, of course! So I wanna thank you so much for having me, absolutely amazing conversation, super engaging. And, if anyone’s interested to find me, check me out on LinkedIn or if you’re interested in our company, check us out at BetterAMS(dot)com. 

Scott (41:44 - 41:50) - That’s it, guys! Go find out more about Amazon and start running ads and making some money! 

Destaney (41:50 - 41:51) - Easy enough. 

Scott (41:51 - 41:53) - Thanks, guys! Have a good one!

41:53 - 42:50 - Episode outro
Scott (41:53 - 42:50) - Thanks again for tuning to this episode of the Growth & Greatness eCommerce Podcast. I hope you got a ton of value out of this episode and if you did, we’d love for you to leave us a review on your platform of choice and help us reach as many people as we can. Now, if you’re a brand founder, an eCommerce entrepreneur, or an in-house marketing manager looking to accelerate your growth this year, reach out to us at Right Hook Digital. We’re a performance branding agency and we specialize in partnering with eCommerce brands to help them hit their growth goals with maximum ROI. Now, if this sounds like a solution that you need, then check us out at righthookdigital.com and schedule a call with our client partnerships team. They’d love to have a chat with you and see how we can help you grow in 2021.