It’s no secret that Amazon is a huge force that has taken over e-commerce. We recently went to the LPX Connect hosted by Logical Position and left feeling extremely excited to keep learning about this topic.

For now, here are the main takeaways. A huge thank you to Micah and Logistical Pro for sharing their slides for this recap.

Did you know?

  • $0.51 of every dollar is spent on Amazon
  • There are over 300 million users and 95 million Amazon Prime members
  • 83% of purchases made in the last month were on Amazon
  • Amazon is the third largest digital ad platform
  • 80% of consumers use Amazon to discover new products and brands

With these staggering statistics, it almost seems impossible to not get involved with Amazon.

WHY NOT? Reasons To Avoid Amazon

  • Lost Margins
  • Customer Data Loss
  • Lack of Brand Experience
  • Supply Chain Management
  • Will resellers be upset?


Five Biggest Mistakes Businesses Make on Amazon


Winning the “Buy Box”

  • The “Buy Box” is the upper right hand corner in Amazon
  • 90% of Amazon Sales go to the seller winning the “Buy Box”

Pricing Strategy:

There are three types of pricing strategies that you can use in Amazon ads.

       1. Manual Pricing

    • Manual pricing is good if you do not have much competition in your market.

       2. Rule-Based Pricing

    • Rule-based pricing allows you to set a price above or below who is winning the buy box.
    • This pricing strategy will change the seller’s item price in response to his or her competitors. (Rubin, 2016)
    • Pros: Allows you to gain the most competitive price
    • Cons:
      • Only competitor prices are considered
      • Prone to human bias
      • Marketing conditions are constantly changing

        3. Algorithmic Pricing:

    • This kind of pricing applies computer algorithms that will set an “ideal price based on all known market conditions.”

  • Cons
    • Algorithmic pricing is much more expensive than other options
    • It’s not typically suitable for small business with a limited budget and small inventory
    • The user has less control over prices

What type of seller are you? Knowing the answer to this question will help you determine what type of pricing strategy to follow.

  • A manufacturer/brand with no resellers
  • A manufacturer/brand with resellers
  • The exclusive reseller of a brand or product
  • One of many resellers of a brand or product

Fulfillment Strategy:

       1. Fulfillment by Amazon (FBA)

    • Amazon holds your item and ships it for you

       2. Seller-Fulfilled Prime (SFP)

    • The seller delivers directly to the domestic Prime customer from his or her own warehouse

       3. Fulfilled by Merchant (FBM):

    • The sellers ship their own products directly from their own homes, business, or warehouses after receiving orders through Amazon
    • This fulfillment strategy does not include Amazon Prime status



How to combat this mistake: Optimize Your Product Information

  • For the Amazon Algorithm
    • Fill out as much product information as possible
    • Ensure that your keywords are relevant
    • Include enhanced brand content
  • For the Consumer
    • Use clear and concise titles
    • Include unique value propositions and product features in the description
    • All images and videos must be high-quality

There is an immense amount of untapped potential when advertising on Amazon

  • Conversion rates are exceptional
  • Advertising directly affects organic performance
  • Missing out on potential market share
  • First-mover advantage



There are five major mistakes that businesses make when advertising on Amazon.

1. Poor Account Structure: Add more structure into your account

  • Segment by:
    • Campaign Types
    • ™ & Non ™
      • Single Keyword Ad Groups (SKAG) and Single Product Ad Groups (SPAG)
    • Targeting Types
    • Product Lines and Categories

2. Not Utilizing All Ad Types

  • Sponsored Product Ads









  • Sponsored Brands









  • Sponsored Display Ads


3. Not Having a Competitor Strategy

  • It’s important to aggressively target your competition
  • Target their keywords and product detail pages
  • Show your ads on competitor’s product pages in various categories

How to protect yourself from your competition:

  • Initiate protection campaigns by utilizing brand keywords and product pages.
  • Use your own keywords and target your own product pages
  • This can help protect you from your competition as well as increase up-selling of your products

4. Not Using Placement and Targeting bid Modifiers

This works for new campaigns only

  • Within ad groups, you can set different bids for close match search terms, loosely match, compliment your product, substitutes, etc.
  • You can do them all and see which one wins, just make sure to set a different bid on all of them

5. Not Utilizing Negative Keywords

  • This is one of the biggest mistakes that advertisers on Amazon make



You’re not alone! Reach out to a trusted Amazon partner. These partners can help you with:

  • Resource allocation
  • New feature adoption
  • Access to betas
  • Elevated support
  • Access to advanced reporting and analytics