NetElixir has released a study on how SMBs view Amazon ads. The firm questioned 500 companies. (See also this blog post by the firm on this topic.)
Findings from a study conducted by NetElixir suggests 40% of the small-and-medium businesses (SMBs) advertising on Amazon say the ads are ineffective, according to survey results released Wednesday. It seems Amazon is going through the same learning curve that Google and Bing went through years ago.
40% of those running Amazon paid ads said they are ineffective. (Lack of know-how was the top reason.)
The corollary of this is that 60% of SMBs running Amazon paid ads say the ads are effective, right? Why is everyone (Mediapost as well as NetElixir themselves) advertising the 40%?
Of those who believe Amazon’s ads are ineffective, 23.7% cite the lack of knowledge on how to use the platform, which suggests the marketplace lacks the proper training for the thousands of small businesses selling products on how to use the ad platform.
If it wasn’t obvious before, these numbers make it plainly visible: While the Amazon Marketplace is taking over product search, at least in markets like the US, Amazon the platform is still relatively young and rough around the edges. That goes for services around the marketplace, the search itself and optimization and of course the advertising products available on-site.
Despite the pitfalls, 52% note increased sales volumes as the biggest benefit to selling their products on Amazon. Some 32.6% cite increased brand exposure; and 11.3% cite a solid infrastructure.
Amazon advertising is going to see robust growth for the forseeable future:
Overall, 60% of SMBs said their biggest challenge was acquiring new customers, while 17.9% said it was retaining customers and 15.3% said it was converting customers.
In an attempt to meet this challenge, 27% plan to invest in paid search within the next five years. More than 60% of these retailers attribute half or more of their ecommerce sales to Amazon, yet 68.4% of the same retailers are not advertising on the platform.
(Highlights by me)
It is interesting that companies are still relatively shy to try out Amazon ads.
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