5 High-Level Optimizations That Drive Better Amazon Ad Performance
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The following excerpt is from Timothy P. Seward’s book Ultimate Guide to Amazon Advertising. Buy it now from Amazon | Barnes & Noble | IndieBound | Apple Books or click here to buy it directly from us and SAVE 60% on this book when you use code MARKET2021 through 4/24/21.
Let’s cover five higher-level optimizations you can make to drive better performance out of your Amazon ad campaigns.
Adjusting bids by placement
Because bidding is an ongoing process where the competitive landscape is always changing, it can be difficult to ensure that your bids are high enough to get the top placement without overpaying for clicks and losing control of profitability. Amazon allows you to increase bids for certain placements. You can enable these advanced bidding strategies in the campaign settings of any manual Sponsored Products campaign.
We recommend adjusting bids by placement for your top-performing manual campaigns as well as any campaigns in which you want to bid more aggressively either on top of search placements or on product detail pages.
Adjusting campaign budgets and campaign status
Regardless of your brand’s investment in Amazon advertising, you’ll need to regularly adjust your campaign budgets. Even accounts that are spending the maximum daily budget will still need to make adjustments. If you’re working under strict budget constraints, it’ll be more a matter of reallocating spend within the account than simply increasing or decreasing budgets based on individual campaign performance.
If one of your top-performing campaigns is hitting its budget limit every day, you should increase its budget to make sure those ads can run for the entire day. The last thing you want is to put your time and energy into building a killer campaign only to have it run for just a few hours a day before maxing out its budget.
One way to check whether your budgets are adequate is to take the average daily spend for each campaign and compare it to their daily budgets. We recommend setting the daily budget about 20 to 40 percent higher than the average daily spend so your campaigns have room to grow. This cushion can be increased during times of peak seasonality or decreased for campaigns with an objective other than profitable growth (e.g., brand awareness).
Reviewing historical trends in performance
Although it can be tempting to get buried in the weeds, doing keyword research, bid changes, and the like, it’s equally important to take a step back and periodically review account performance trends over time to see if you’re accomplishing the goals and objectives you set for the account.
While Amazon now allows you to select dates in both Seller Central and Vendor Central, making it easier to see ad performance over a specific date range, users can only view the past 90 days. The interface also isn’t conducive to viewing trends over time. Although Amazon now provides an interactive graph to show trends for the selected date range, the limited amount of data makes it nearly impossible to analyze quarter-by-quarter and year-over-year trends. Sellers and vendors have come up with some creative workarounds to this problem.
For example, my company works with a well-known brand manufacturer in the toilet and bath fixture industry who was running campaigns in Vendor Central and wanted to compare historical monthly performance. They designed their campaigns to start and end on the first and last day of each month. At the end of the month, they copied all their active campaigns using the copy feature within the Campaign Manager interface, and then updated the start and end dates to reflect the following month.
Comparing monthly performance past 90 Days
You can track advertising performance over time by creating an Excel workbook so you can track and compare monthly performance and spot trends at the campaign level. We recommend doing this once the full attribution window is complete for the previous month (seven days in Seller Central and 14 days in Vendor Central).
Each month, review and record the previous month’s campaign-level performance data after the full attribution window is complete. Maintaining this Excel file will help you keep track of your historical advertising performance. Although the interface does now include graphs of historic performance, recording the data allows you to have the actual data at your disposal for as far back as you began this process. This will also allow you to more easily spot campaign-level trends as well as trends in traffic or keyword type.
When looking at historical performance trends, you should look at the ad’s performance as well as your business’s performance on Amazon as a whole (including organic sales). By looking at both, you can examine how your advertising strategies are impacting your business.
Analyze impact of prime status changes
When looking at historical performance trends, keep in mind any changes that have been made to fulfillment and how they may have affected performance. For example, if products that were previously Prime-eligible lose the Prime badge, you’ll likely see advertising performance fall. On the other hand, you’ll likely see a boost in performance when products gain Prime status.
If any of your products lose their Prime eligibility, you should focus your advertising spend on your remaining Prime products. It’s essentially the only thing you can do on the advertising side when your products lose Prime status.
If you don’t manage the fulfillment piece yourself, I encourage you to work closely with your fulfillment team to learn what steps are necessary to get Prime eligibility for your products. Amazon highly favors Prime products, and if you lose that status, it can be hard to make up the lost ground.
Rotating advertised products with seasonality
Seasonality is present in almost all categories, and you need to make sure you’re in a position to make the most of it. To capitalize on a product’s seasonality while still having coverage on the entire product catalog, prioritization is key. This can be accomplished through campaign structure where products are grouped by theme and through implementing a tiered bidding approach.
From time to time, you’ll want to take a step back and “inspect what you expect.” Self-auditing your own account can uncover waste as well as provide insights to grow revenue.
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