By Ayush Pateria | Lead, Business Strategy & Analytics | ETML
In the ever-evolving landscape of online marketplaces, businesses are constantly seeking innovative strategies to boost their visibility and revenue. This struggle led us to a new experiment that focuses on leveraging advertising-led visibility to fuel organic growth on the popular platform Amazon.
The objective was clear: Increase overall revenue while keeping the spends constant.
Understanding the Marketplaces Dynamics
Unlike other advertising platforms such as Meta and Google Ads, the control over Amazon’s Brand Development Index (BDI) lies with the advertisers, while the Category Development Index (CDI) is influenced by brand and Amazon marketing efforts. To maximize BDI, brands must focus on maximizing the Glance Views (GV) share, which can be achieved by increasing the Share of Voice (SOV) in high-traffic areas.
Glossary:
- Glance Views (GV) show the number of times a Product Detail Page is viewed
- Share of Voice (SOV) is the percentage of your brand’s market share visible on the first page through paid traffic.
Strategies for Advertising-Led GV Share Maximization:
– The proposed experiment suggests employing Sponsored Product (SP) campaigns with a dynamic bidding strategy with exact match keyword targeting to enhance Advertising-led GV share. The rationale behind this is to increase the visibility of the brand in high-traffic areas, ultimately maximizing the chances of consumer engagement.
– To increase organic GV share, it is crucial to enhance Organic SOV. This, in turn, is directly tied to achieving sales numbers for specific keywords. The hypothesis states that by investing in high-traffic keywords through SP campaigns, the increased GV share will prompt the Amazon algorithm to perceive the brand as a top performer. Consequently, the algorithm will organically promote the brand and its products.
– The Search-Sales Factor (=Search Volume/CPR) becomes a key metric for determining the effectiveness of keyword investments. CPR is the number of purchases that are required to be made by a brand within 7 days in the keyword to increase the first page SOV. Brands are advised to focus their spending on keywords with the highest Search-Sales Factor, indicating that fewer purchases are required to increase the first-page SOV. This targeted approach ensures efficient allocation of resources for optimal results.
Result
The experiment’s findings reveal a direct correlation between increased advertising and organic SOV, leading to higher Ads and Organic Glance Views (GV). As the brand’s visibility grows through advertising, organic revenue from those keywords also sees a significant uptick.
(Disclaimer : Actual numbers have been masked for brand’s data privacy)
The actionable steps derived from the experiment involve aggressively targeting the top six keywords in the category with the highest ‘sales-search factor.’ Through strategic spending and acquiring top positions on these high-traffic keywords, the brand aims to not only dominate the advertising space but also create a ripple effect that boosts organic visibility over time.
Conclusion
The above experiment suggests a symbiotic relationship between paid and organic growth on Amazon, emphasizing the importance of strategically investing in high-impact keywords. By understanding and implementing the dynamic bidding along with an emphasis on the Search-Sales Factor, brands can propel their visibility, influence the algorithm, and unlock a new realm of organic revenue. This innovative approach has the potential to reshape the way businesses navigate the competitive landscape of online marketplaces.
