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How to Leverage Amazon for New Customer Acquisition

For years, some advertisers have hesitated to invest too heavily on Amazon because, among other reasons, it offered limited options for acquiring new customers. Brands were undoubtedly reaching new customers, but there was no reporting to understand how often that was happening and there was no opportunity to add those customers to CRM databases. However, developments over the past year have made it easier than ever for advertisers to acquire and report on new customers through Amazon advertising.

Reaching New Customers on the Amazon DSP

The Amazon DSP offers the most flexibility of all Amazon advertising options when it comes to reaching and acquiring new customers for two main reasons. The first is audience options. Advertisers on the Amazon DSP can upload customer lists for campaign targeting, similar to what’s done on platforms like Facebook, Google, or Bing. That customer list can then be used for either positive or negative targeting to indicate that you only want those people to see an ad from that campaign or you never want them to see one.

In order to reach new customers, an advertiser would load their existing customer list to Amazon and set up a campaign excluding those users. With those settings in place, all users that see ads from that campaign should theoretically be new users. Similarly, with Amazon’s new Audience beta you can build an audience of people who have purchased specific brand ASINs (Amazon’s equivalent of a SKU) in the past 365 days and exclude them as well.

This, in conjunction with your own site’s existing customer list, provides a comprehensive pool of existing customers to exclude from new-customer-focused campaigns. There, of course, are caveats, and some existing users are still likely to see ads due to challenges with matching an email address in a customer file to an actual end user. Directionally-speaking though, the performance for this campaign would be largely representative of new customer performance.

The second reason the Amazon DSP is good for reaching new customers is its landing page flexibility. For many ad formats on Amazon, the landing page must be a product page or Stores page on the Amazon domain. When that’s the case, advertisers are not able to capture a customer’s email address to add to their database. With Amazon DSP ads, however, brands have the option to land shoppers straight on their own site where the user can complete a purchase and share their contact information just like they would if they had visited the website directly. Before deciding to pursue this strategy, check with Amazon to ensure that your brand qualifies to drive media traffic off-Amazon. Not all retailers are eligible.

Understanding New Customer Interaction through New-to-Brand Metrics

On the reporting front, Amazon started providing new-to-brand metrics on display, video, and Sponsored Brand ads in January of this year. This data is isolated to the Amazon platform, meaning it can’t tell whether a customer has purchased from your brand before anywhere else on the web.

By Amazon’s definition, these metrics report whether each “ad-attributed purchase was made by an existing customer or one buying a brand’s product on Amazon for the first time over the prior year.” The metrics advertisers receive include new-to-brand orders, new-to-brand sales, the % of sales/orders that are new-to-brand, and cost per new-to-brand customer.

Using New Customer Insights to Make Strategic Decisions

Building strategies around new customer acquisition campaigns on the DSP is a relatively straightforward endeavor. For the campaign or campaigns limited to new customers, advertisers should consider the lifetime value of the new customers they’ll acquire through these ads when determining their return goals. This will likely mean targeting a lower initial return than on other campaigns for the sake of getting new customers acquainted with your brand.

Using Amazon’s new-to-brand metrics rather than DSP audiences for a customer acquisition strategy is murkier since it’s limited to the Amazon platform. Additionally, the New-to-Brand data from Amazon can’t be leveraged as an audience, meaning that you can’t create campaigns specifically targeting or excluding those customers. Instead, if new customer acquisition is a priority on Amazon (but not your main goal), a good place to start is identifying which of your campaigns have the highest % of sales coming from new-to-brand shoppers. Areas of the account generating significantly more new customer orders than others could warrant lower return targets, though determining those targets will be a less exact science than on the DSP.

By piecing together these different tactics, advertisers on Amazon can get a much better idea than in years past of how many new customers they’re reaching. We hope that in 2020 we’ll see expanded new-to-brand data (on Sponsored Products, in particular) and new targeting abilities (like separate campaigns for new-to-brand vs. existing customers) but are very happy with the progress that’s been made in 2019!