In 2022, Amazon’s ad sales increased 19% YOY, even while Meta and Alphabet suffered setbacks in their digital advertising business. And there’s plenty of room for growth: Advertising accounts for just a fraction of the ecommerce giant’s annual revenue, and Amazon only holds 7.3% of the overall online ad market.
What does that mean for brands like Miko? Amazon will only become more critical to digital ad strategies in the months and years to come.
However, advertising on Amazon doesn’t come without limitations. The Amazon Ad Platform doesn’t allow advertisers to leverage dayparting — a tactic that targets different audiences at different times of the day based on geography, age and other factors. It also lacks functionality for automating bids, which can quickly impact a campaign’s customer acquisition cost (CAC). To ensure we optimize our Amazon advertising campaigns, Miko built an in-house marketing engine that layers over the ecommerce giant’s ad platform. This innovative tool helps Miko optimize our Amazon advertising CAC, giving us the competitive edge in the ever-evolving online advertising landscape.
The value of our in-house marketing engine
Instead of using the Amazon Ad Platform as-is, Miko leverages first-party data to retarget audiences both on and off Amazon. Our in-house marketing tool layers on top of Amazon’s platform to give us capabilities beyond what’s possible with Amazon alone. We can automate bids and keywords, and enable dayparting — all at scale — and the results speak for themselves.
When we layered our POC tool over Amazon’s ad platform, we decreased our CAC by a staggering 80%. There’s no understating the impact of a drop from 30% CAC to 5%. And because our tool is built to scale, its impact will only be magnified as a brand’s number of products — and ad campaigns — grows.
Advertising is now Amazon’s fastest-growing sector, surpassing subscription services like Amazon Prime Video in annual revenue. With more than 300 million active customers, Amazon ads can help brands reach a global audience ready to click “Buy Now.” But for brands serious about optimizing their CAC, the company’s built-in platform isn’t enough. We’re setting a new benchmark for Amazon ad campaign optimization, and it’s only possible through our innovative in-house tool.
