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Amazon Explores PPC Model on Product Pages

Amazon.com debuted an affiliate advertising feature called Product Ads on Amazon, which enables e-commerce sites to promote their own wares on Amazon's product pages.

Ads can consist of both a price and product image.

"Amazon will display your ads in highly targeted placements," — including positions beside the shopping cart button, according to the program description.

amazon-ppc.jpg

"When customers are interested in buying your product they click through to your Web site and purchase directly from you.
Over 85% of Amazon.com's 44 million monthly visitors are likely to have made an online purchase in the last 30 days."

The program operates like standard search engine pay-per-click programs — advertisers only pay for click-through, which can range anywhere from $0.15 per click (Toys, Home & Garden and Baby categories) to $1.25 per click (Electronics & Office).

Price ranges, arranged by category, appear below:

amazon-ppc-model.jpg

Product Ads on Amazon was positioned as an altruistic way for merchants to leverage the e-tail giant's user base while Amazon customers see items are available elsewhere online. But Get Elastic's Linda Bustos made two observations about the burgeoning effort:

  • Recommendations aren't currently very relevant. A dog toy called Kong Flyer, for example, generated ads for candles and faucets. (Froogle, an obsolete third-party e-commerce effort by Google, had a similar relevance problem. Froogle has since been folded into "Google Product Search," which simply scans the 'net for items consumers seek.)
  • The ads could draw sales away from Amazon and affiliate sellers. "As a seller, I don't appreciate Amazon pointing potential customers elsewhere," Bustos wrote.

Product Ads on Amazon is still in experimental phase, meaning click rates and ad positioning are subject to change as the online giant learns how best to target third-party promotions to users.

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