Advertising on Budget? These 7 Tips will help you boost your Sponsored Ads ROI on Amazon

Advertising on Budget? These 7 Tips will help you boost your Sponsored Ads ROI on Amazon

The ROI becomes far more important when we’re advertising on budget. A poor ROI gives the impression that the PPC is not worthwhile, preventing us from leveraging the PPC tools to boost sales on the Amazon platform and set up a more successful Amazon business. Therefore, it becomes really important to get some good results. And, for that, these 7 tips will help:

1. Picking High Converting products

This is more of a product-level strategy. In general, a product that has a good organic conversion also has a good PPC conversion. So, when on a budget, start with a few products that have a high conversion (that you can find out through Seller Central > Reports > Business Reports) and get some uplift in overall sales, which, can help generate additional revenue to later advertise on low converting ones.

2. Include fewer product variations (child items)

If your product has various child items, then advertising all of them could result in more spend while advertising only 1-2 of them would anyways get the customers to see all of them when they land on the product detail page. This also means that if you have similar products as separate items, you can consider merging them inside one parent so that they can be discovered more even organically as well. Again, out of the different variations, usually 1-2 have the highest conversion, so you can pick them. And, in this case, you are picking up a high converting product’s high converting variations to further ensure an improved ROI

3. Include Defensive Campaigns

A lot of your product detail page visitors might be going to other competitors’ product pages because Amazon lets them target your products to show their ads. As a result, you may end up spending money on clicks and not getting sales. So, to control that, you can set up product targeted campaigns on your own product page and occupy the placement. Out of the various options (Sponsored Display (SD), Sponsored products (SP), Sponsored Brands (SB)) that can all be leveraged here, SP product targeting and SD are usually the best bet followed by the SB.

3. Product Targeting on Top Ranking Products

This is more of an offensive strategy that can be combined with Defensive. Bids are usually higher on high volume keywords increasing costs or limiting your chances of showing up on top of the page if you’re bidding low due to budget constraints. However, top ranked products get a lot of visitors and product targeting on them is usually cheaper than those high raking keywords. As a recommendation, if possible, select the products that have:

  • Higher price than yours
  • Lesser no. of ratings and/or stars
  • Fewer options (size, color, style…)

4. Replace Automatic targeting with Manual

Manual targeted campaigns are more controlled since you get to define the target audience and you can be more strategic. And, it’s recommended to spend more time on researching keywords/products to target. At some point though, it’s also worthwhile introducing the Auto targeted campaigns as they help discover more target keywords and products, in that case, starting with only close and loose targeting with low bids is helpful.

5. Optimize for placements using Dynamic Bids – Down only

The Dynamic bids – down only option automatically prevents your Ad from showing up when it’s less likely to convert on a placement (top of the search results or product detail page) by reducing bids by a certain percentage that you can define. However, it’s crucial to get some data before enabling it, usually, after getting a couple of sales.

6. Limit your bid not the budget

Your Advertised product might convert more at a later time in the day rather than early. So, in that case, ensuring your ad runs 24×7 is crucial which is only possible when your daily budget has not exhausted. More controlled bids ensure minimal spend despite a good budget amount. This encourages Amazon algorithms to show your ad more while a low budget discourages that.

7. Measure the Overall Impact

The advertising essentially improves traffic on your product detail page to eventually improve ranking, product discovery… Besides, as you’re advertising fewer variations, others getting converted may not be reported. However, looking at the overall sales shows the impact the advertising is making on you organic sales as well which usually is good. So, looking at TACOS (total ACOS derived by dividing total ad spend by overall i.e. Organic + PPC sales), you can see how much additional revenue is getting generated, which is otherwise overlooked when looking just at the advertising reports and performance.