The overview of the advertising landscape on eBay
According to multiple industry reports, ad spend on online marketplaces continues to scale aggressively, highlighted by first-party advertising products on eBay surging 33% year-over-year to cross a massive $2 billion annual revenue milestone.
According to eMARKETER, this heavy reliance on closed-loop shopper data has driven total US retail media ad spend up 20% year-over-year, establishing a $60 billion footprint in which platform-specific promotions largely dictate search visibility.
Furthermore, according to IAB Europe’s AdEx benchmark data, the e-commerce advertising ecosystem continues to mature aggressively alongside these marketplace shifts, with Retail Media driving an impressive 22.2% growth rate, helping push total continental digital ad spend to a record-breaking €118.9 billion.
As ecommerce advertising grows in popularity, the current eBay marketplace model is shifting the dynamics between organic and paid search.
In popular eBay categories, more than 50% of the first page of search results are sponsored products, and the first 5 results get the most clicks.
How do eBay Promoted Listings work?
Promoted Listings are a part of the broader eBay Advertising framework that allows sellers to place their listings in sponsored placements across eBay.
This means that listings promoted through General Strategy or Priority Strategy campaigns can be displayed in ad slots in the search results, competitors’ listings, or even on the platform’s partner sites.
Still, the mechanics of running ad campaigns with Promoted Listings largely depend on the strategy a seller chooses.
So, let’s take a closer look at what Promoted Listings are and the types of campaign strategies available through this program.
What are Promoted Listings on eBay?
Promoted Listings are ads or sponsored items that help sellers increase product visibility and sales.
They’re displayed in search results, competitors’ listings, and product pages. eBay uses a range of parameters, such as the listing’s relevance to a search query or ad investment, to pull the seller’s promoted listing.
Promoted Listings can be used in both pay-per-sale (PPS) and pay-per-click (PPC) models.
Promoted Listings that use the cost-per-sale model (sellers pay only when they sell) are labeled as General Strategy campaigns.
The Priority Strategy and Promoted Offsite are cost-per-click campaign models that help sellers reach the top spot in search results on eBay across desktop, mobile, and capture external traffic from Google and other platforms.
To secure those premium ad spots across eBay, sellers must bid for the top search results slot using keywords and budget controls.
Which types of campaign strategies are available in Promoted Listings
Depending on their advertising needs, business goals, and budgets they can allocate to their promotional efforts, eBay sellers can choose from three different campaign strategies.
As noted earlier, General Strategy enables merchants to run traditional CPS campaigns, while Priority Strategy and Promoted offsite options allow sellers to run CPC campaigns.
Let’s take a quick look at the key characteristics of these campaign strategies:
- General strategy – This advertising solution gives sellers the freedom to set the flat ad fee rate they’re willing to pay for the sale of their product. It’s worth noting that sellers using this strategy cannot place their listings in the number one ad slot in search results.
- Priority strategy – Sellers who opt for this advertising strategy pay for each shopper interaction, regardless of whether the shopper who initially visits the listing via an ad click buys a product. Although it can be cost-intensive, Priority Strategy is the fastest way to secure the top ad slot for listings across eBay.
- Promoted offsite – As the name suggests, this program is tailored for eBay sellers looking to expand the reach of their products beyond the platform. This strategy allows merchants to generate traffic from external sources by promoting their products on platforms like Google and Facebook. The advertising model’s primary limitation is that sellers must pay for all clicks generated during the campaign, even those that don’t result in sales.
How to set up a Promoted Listings campaign strategy?
These are the basic steps to setting up Promoted Listings strategies:
- Go to the Advertising tab in Seller Hub.
- Click “Create a new campaign”.
- Choose your General, Priority, or Promoted Offsite advertising strategy based on your budget and sales goals.
- Select individual listings or multiple listings in bulk. The platform currently lets sellers add up to 200 listings with its bulk import tools directly from the Live Listings page.
- Apply an ad rate. If using the General Strategy, select your ad rate percentage, fixed or dynamic, using the trending benchmark. When using Priority Strategy, you should set your daily budget caps and adjust your keyword cost-per-click bids.
- Name your campaign to track its progress later and launch it.
Create a smart advertising strategy: when and how should you advertise on eBay?
Ads on marketplaces positively impact product page views, transactions, and revenue. In general, they’re very effective for a short-term sales boost.
However, an effective long-term advertising strategy is quite different. For example, the level of competition depends on the time of the year, seasonal events such as Black Friday, and so on.
For starters, if sellers aren’t aware of how Promoted Listings work, they may not know how to successfully advertise on eBay: when, how, or whether they actually need ads.
For example, some items or search terms may be very popular. Consider the game Minecraft. The search results include over 150,000 individual listings, making it extremely hard for any listing to stand out. In such cases, promotion can come to the rescue.
On the other hand, listings of unique, rare, or hard-to-find products will probably be visible without any extra effort. No ads required.
Sometimes sellers must put in more effort to increase an item’s sales, while other products can sell relatively easily with minimal ad spend.
That’s why advertising activities should be adjusted to an item’s actual promotional needs rather than uniformly applied across a seller’s portfolio.
A well-thought-out advertising strategy is a must. Unfortunately, many sellers aren’t familiar with the so-called rules of the game or find it too time-consuming to understand how advertising on eBay really works.
Your eBay advertising plan in a nutshell:
- Do your research to decide whether or how to invest in Promoted Listings.
- Estimate your ad budget.
- Set up your goals. For example, do you want to drive more sales or improve brand awareness?
- Select the right products to advertise. Your most popular products, along with those with the most competitive prices, have the highest potential for sales conversions.
- Create clear, concise, and persuasive product pages. Include accurate and descriptive titles, keywords, useful and relevant product information, and high-quality images.
- Plan, act, and test what works and what doesn’t.
- Track your progress and measure relevant metrics. Optimize your listings accordingly.
How to increase sales with Promoted Listings at lower advertising costs
Ad investment involves serious and strategic allocation of funds. Poor understanding of how Promoted Listings and keyword bidding work can result in sellers spending much more than needed on advertising.
It may not bring the desired ROI, either. One of the primary questions sellers must answer is when to go with a safer or more aggressive bidding approach.
The Webinterpret solution takes into account the current trending ad rate when recommending ad rates to our sellers. There are numerous questions that are not always easy to answer, for example:
- What ad rate should I choose to get the best possible ROI?
- How to bid?
- Does eBay recommend an ad rate that is optimal for me? What happens if I choose lower rates than those the platform recommends?
To find answers to these questions, sellers must frequently monitor and modify their ad rates, since using eBay’s recommended ad rates can cost them 2-3 times more than they actually have to spend, while generating no additional revenue.
Promoted Listings: 5 key takeaways
#1. Promoted Listings campaigns boost product visibility, with impressions increasing 4-5 times and product page visits rising by 60-70%.
#2. Multi-market campaign data indicate that consumer response to advertising varies significantly by region, with German shoppers historically showing a much higher tolerance and click rate for sponsored listings than US shoppers.
#3. Ad expenses are highly dynamic, fluctuating based on regional competition and seasonal demand. Highly competitive marketplaces like the US command higher average ad rates than international markets like Germany.
#4. Data shows that conservative ad rates often deliver the highest overall ROI for eBay merchants. According to research, merchants using a “safe bidding” model achieved massive international sales increases, up to 35% in Germany and 54% in the US, at advertising costs up to three times lower than eBay’s recommended rates.
#5. Data and testing help you determine your optimal bidding strategy. Sellers should regularly adjust their bids depending on the changing ad rates of other sellers and profit margins. The key is to find the right balance.
Read our article about the Promoted Listings experiment for the full description, results, and charts from our study.
International advertising and sales opportunities on eBay
eBay is a huge international marketplace, and as such, it is also highly competitive. For this reason, to stand out from the competition, consider paid promotion along with testing less competitive markets.
eBay lets you sell on markets with less competition and greater sales potential. These are often foreign markets where local online sellers cannot offer specific products or meet the local demand.
The possibility of satisfying the unmet demand for unique products from overseas is one of the biggest worldwide opportunities for ecommerce retailers.
Herbert Knibiehly, Chief Marketing & Product Officer at Glopal
If you’d like to grow your ecommerce sales, don’t hesitate to contact our cross-border sales specialist. You’ll learn about sales and advertising opportunities in different markets.
eBay Promoted Listings as your store’s growth driver
eBay Promoted Listings’ advertising model is seller-friendly due to the possibility of using both PPS and PPC models.
It’s worth trying one of the available campaign strategies within the Promoted Listings framework, given their increased sales potential. Advertising can significantly increase your sales both domestically and internationally.
Finding the balanced bidding strategy is the key. Applying ad rates recommended by eBay may bring the biggest sales, but due to ad costs, this may not be the best return on investment.
Webinterpret’s ecommerce listing tool helps sellers leverage ads on both domestic and many international markets. With access to data and vast ecommerce knowledge, we can help merchants tap into their actual sales potential to achieve the best possible ROI.
Check out our eBay advertising tool if you’d like to fully automate your advertising campaigns across eBay and benefit from our expert knowledge.
About Webinterpret
Webinterpret supports merchants selling on eBay.
Our AI-based solutions enable more effective selling through automated listing localisation, optimisation, advertising, and returns, and ensure all products placed on EU markets are GPSR-compliant.
By giving your international and domestic customers a full, end-to-end local shopping experience, Webinterpret improves your conversion rates and helps establish your business locally and globally.
