Advertising is big business for every major social network. eCommerce marketplaces like Amazon are no exception.
This week on TRENDS REPORT, we have insights from Bryan Porter, Co-Founder of Simple Modern. Simple Modern is a drinkware brand that leverages Amazon for sales and (formerly) paid advertising. Recently, Bryan blew up Twitter with a revelation.
We are Amazon's #1 drinkware supplier. In 2022 we will sell over 4 million tumblers and water bottles.
Over the past few years, we have spent over $10 million on Amazon ads.
This month our budget went to $0.
A thread about our change of heart with Amazon Advertising:
While the revelation itself - that Amazon "pads" its search results with paid listings to the detriment of organic listings - is not new, the testimonial is an amazing eye-opener for eCommerce marketers.
In short, Simple Modern leveraged Amazon ads as a way to boost their product pages. What they found (almost by accident) was that their organic listings generated as good or better results when they were NOT boosted with paid ad spending.
At the same time, Simple Modern found that by boosting a product page, they diminished the returns on their organic listing. Bryan noted:
"Advertising profitability was inflated by ads not driving sales. In other words, organic customers were using ads to shop when they were going to purchase anyway."
That said, Simple Modern pours great energy into building optimized product description pages (PDPs). And this commitment only reinforced their conclusion - if we invest time into building great PDPs, why pay for ads in the first place?
Many marketers and brands shared Bryan's Twitter thread (including Yours Truly). See comments in this discussion led by Jed Schneiderman:
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