US Advertisers Moving More to Top-of-Funnel Objectives on Amazon

May 8, 2020

Tinuiti Amazon DSP Spend Share by Funnel Stage May2020Over the past year, US Amazon advertisers have increased their focus on top-of-the-funnel objectives, with the share of Amazon demand-side platform (DSP) spending focused on awareness and consideration inching closer to the share dedicated to the purchase stage, per a recent report [download page] from Tinuiti.

In the first quarter of 2020 US advertisers dedicated 43% share of their total Amazon DSP spend to brand awareness efforts. This represents a 65% year-over-year (y-o-y) increase from Q1 2019, when brand awareness represented about one-quarter (26% share) of their DSP ad spending on Amazon.

This increased focus on brand awareness can be seen in other research, with a report from Feedvisor showing that while driving sales and customer acquisition are top reasons why brands are selling and advertising on Amazon, an equal number of brands are also using the platform to drive brand awareness.

Here are some other notable findings from the report:

Overall Ad Spend Increases Slightly in Q1

Amazon DSP ad spend increased by a modest 4% between Q4 2019 and Q1 2020, per the report, spurred by a 42% growth in impressions and alongside a 26% drop in CPM.

Sponsored Product Spending Grows

Advertisers hiked their Sponsored Products spending by 24% year-over-year in Q1, with sales growing by 19% y-o-y.

Clicks on Sponsored Products also saw growth (14% y-o-y); earlier data from Tinuiti indicates that the largest share of clicks for Sponsored Products occurs on product detail pages.

Increased Investment in Sponsored Brands Leads to Higher Sales

Although the advertisers sampled for the report hiked their Sponsored Products ad spend, they are also seeing the value in Sponsored Brands, investing 47% more in Q1 2020 than they did in the year-earlier period. This led to an increase in sales of 57% y-o-y.

End of Quarter Affected by Coronavirus

Sponsored Products took a hit at the end of March due to customer demand changes and other changes Amazon made in light of the coronavirus outbreak. Sponsored Products conversions, which had been consistently higher y-o-y throughout the quarter, dipped in the final two weeks of the quarter with an 11% decrease in conversions compared to the same time last year.

The full report can be downloaded here.

About the Data: Results are based on anonymized performance data from Amazon programs under Tinuiti management, with annual Amazon ad spend under management totaling more than $400 million. Samples are from programs that have remained active and with a consistent strategy.

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