The Importance of Amazon Ads for New Brands and Sellers: How Advertising Can Boost Success on the Platform
Achieving Critical Sales Velocity in the Make-or-Break First Six Months
The role of Amazon Ads in the success of new brands and sellers cannot be overstated. According to research conducted by Amazon, only 6% of non-advertising sellers were able to achieve critical sales velocity (defined as median weekly sales across all brands in the category) within the first six months after launch. In contrast, nearly 40% of sellers who adopted advertising were able to achieve this critical sales velocity within the same time period.
Not only were more advertisers able to achieve critical sales velocity, but they were also able to do so in less time, with the average time taken for this being 21 weeks for non-advertisers and 12 weeks for advertisers. Advertising can boost initial consideration and purchase, and over time, can lead to the building of significant organic traffic. In fact, among successful advertisers, the share of organic traffic continued to grow from nearly 50% in week one to about two-thirds by week 12.
The cost of advertising also follows a declining trend over time, making it a more cost-effective option for new sellers as they continue to grow. In short, advertising provides a significant boost in the critical early weeks for new sellers and increases their chances of success. It is an important tool for new brands and sellers to consider as they launch on Amazon.
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