Amazon New Product Launch Ad Spend
How to Determine the Duration of Ad Spend Boost
When you launch a new product on Amazon, how long must you boost ad spend before organic search begins to take hold? Unfortunately, there is no direct recipe or formula to calculate the necessary length of time for aggressive new product launch ad spend. However, we have some consideration guidelines that can help you determine when you might begin letting your foot off the gas.
It is important to note that for these suggestions to apply, we are first assuming that you are launching an item with all the winning attributes: it has proper R&D behind it, is produced well, offered at a compelling market price, is an e-commerce aligned product, is desired or needed in the market, and is supported with Amazon-optimized content and images.
A necessary premise exists here as well, and that is: you understand to launch a product on Amazon, you should budget and plan for a healthy ad spend. This is the stage in which you are building awareness and traffic on Amazon and should plan for sub-optimal ROAS.
The first element to consider is your existing brand equity. When launching a product with existing strong awareness in your brand and category – for example, you’re launching a product update or variation – then it’s safe to figure that organic search of your new product will take hold faster than an item in a new category or lesser-known brand.
It’s All About the Amazon Relevancy Score
When planning for your new product launch ad campaign, the intensity of the program will affect the amount of increased spend-time required. Are you willing to direct traffic to Amazon from other channels? To run a 25% off coupon? To shift ad dollars from other platforms? The more you front-load your campaign with these efforts, intensify the ad-spend and ultimately build the new product’s Amazon Relevancy Score, the quicker your success will be. However, even new products with the best brand equity, strong social presence and robust plans for directing traffic to Amazon will still require a minimum of two months before desired organic results are achieved.
Next, consider the competitive dynamics. The initial spend to dominate search rankings in a highly specific or niche category will look very different than the spend required in a highly competitive and saturated category. We recommend ample competitive research and set your expectations on timing accordingly.
Determining Performance Metrics
When assessing the results of your new product launch campaign, isolate performance metrics from other variables. Understanding the difference between category share and share of search results on Amazon is critical. On Amazon, there are unique ways consumers find your products – unlike typical store categories – so setting realistic expectations to see share of search improvement over category dominance could very likely translate to a winning scenario for your new product. Simply put, your product must be discoverable on Amazon to get sales, so you should not take pressure off your campaign until your product is landing on page one of relevant search results. The ideal goal is to appear in the top 10 search results; top three is better yet.
Additionally, new product launch ad campaigns require careful monitoring and maintenance. It is not a “one and done” endeavor. Competitors will change their strategies, which will affect your item’s search results. Consumer online shopping behaviors are also changing more quickly and drastically now, with brand loyalty being increasingly up for grabs. Success in new product launch advertising on Amazon depends on strategy in planning, measuring, and adjusting. If all adjustments are made and desired success is still not achieved, you may need to perform a gap analysis to address potential problematic attributes of the product.
We have multiple proven tips and best practices for new product launch advertising on Amazon, including up-front gap analysis, competitive review, HERO product or brand leverage, and off-channel presence. Contact us to learn more about how our e-Commerce optimization platform works to craft an effective Amazon new product launch plan.