Kris and Dustin discuss what it means to optimize your Amazon pay-per-click PPC advertising campaigns and some tips you can be doing to lower your ACoS now!
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– Hello everyone and welcome to episode 30 of Two Amazon Sellers and a Microphone. Today, Kris and I have a pretty cool topic. We’re gonna talk about what is PPC optimization on Amazon. So this’ll be fun to dig into. Kris how you doing, man?
– Good, how you doing?
– I’m good, I cannot believe we are on episode 30.
– I know, it’s been going by real fast and it’s good to see you got the memo today on wearing a blue shirt.
– Yeah, exactly. I know, that’s hilarious. Yeah, typically I’ve got my chief’s gear on.
– I know.
– So today, I’m changing up a little bit. But, let’s dig in Kris, ’cause this is, I feel like the topic of optimization for ads on Amazon, there’s a lot of confusion about it. A lot of people don’t understand that there might be a need for it, or even what it is exactly. How would you define optimization of Amazon ads?
– That’s just such a generic term, you know? Like, everyone’s, “I’m optimizing my PPC”, it’s like, yeah, what does that entail? So to me, optimizing is like going through, adjusting your bids on your keywords, making sure your products and your like products are in the same campaign, but before doing all of that, it’s like, you need to know what your goal is. Are you going after like a target A cost, which is your advertising cost of sale, or are you going after like, ranking and launching and trying to improve your keyword ranking? So, each campaign is gonna have its own type of like, goal. And that would be like the first thing I would do, is like, what’s your goal for that campaign? Are you on page one already for that product? If so, maybe you’re going after a target A cost. If you’re not on page one already and you’re trying to increase your sales, your goal is obviously to increase sales with that campaign. So first thing, know what your goal is for that campaign. After you know what your goal is, make sure you’ve got it set up correctly. Meaning like, don’t have your products mixed and matched within that campaign. Make sure you have all your products together, or you could separate them out in separate campaigns, but make sure that they’re all, you know, lined up together and grouped in similar ad groups. So those are like the first couple things I would do. And then later on, here in a minute, we’ll talk about like, optimizing for you know, bid adjustments and placements, and stuff like that. But that’s where I would start.
– Yeah and I think it’s good to point out right now that Amazon itself does absolutely no optimization on your campaigns for you. With the exception of keyword discovery, if you’re running an automatic targeting campaign. And so, talking to sellers every day, that’s something that we hear all the time as well. I, you know, I’m already running an automatic targeting campaign, so it’s already kind of, the optimization is sort of automated and that’s really far from the truth.
– There’s no optimization in there. I also think that optimization is not necessarily about reigning in your spend or controlling your spend. I think to be successful advertising on Amazon, you’ve got to cover a lot of bases. Number one, you’ve gotta be in front of all the places where your buyers are. So, discovering keywords, discovering competitors’ ascents is all part of optimization, right? So that’s a lot of the testing and finding out about it. And then also, like you mentioned before, reigning in the spend to meet a certain goal is part of optimization. And we’ve talked about this in the past, but a low A cost is not always the goal. In fact, that almost shouldn’t be your goal, a low A cost because you can get it down to zero by not advertising. And then your product and sell. So there’s a lot of facets to optimization. And I think like you said, based on what your goal is, is how you focus your spend and your budget on those different aspects of it. Whether it’s more in keyword testing or keyword discovery, or more in bid adjustments or a combination of that. So, let’s talk first about if you’re running just an automatic targeting campaign, okay? Let’s talk about just if you’re running just an automatic targeting campaign and you’re looking to get started with optimizing that, go over what you need to do in terms of like, negative keyword creation, moving keywords out, et cetera.
– Yeah, so, automatic campaign, for those of you who are not familiar, automatic campaign is where Amazon controls where your product shows up based on your listings. So, Amazon’s gonna scrape your listing. Your product is gonna show up where Amazon thinks is relative to your listing. So, that’s why we always harp on make sure your listing is awesome, has a lot of keywords, and so forth, ’cause this is super important. So in automatic campaigns, what I do and just some start differently, but you can start off with a high bid and like medium-sized budget, medium like, anywhere between like 30 and $50 a day. But the reason I do a high bid is ’cause I want to get a lot of data fast. I want to see where Amazon, show me what Amazon thinks my product is relative for. So they’re gonna give you back a whole bunch of keywords that they think my product is relevant for. When I go through that, that testing phase, it’s gonna last a few days. Inside your automatic campaign, there’s what they call a search term report. The search term report will show you what search terms customers typed in and in Amazon showed you up for that listing or for that ad. So, it’s important to go through that search term report because there may be some keywords in there that have nothing to do with your product and you don’t want to keep spending money on those types of keywords because they’re not gonna convert. They’re not where you’re trying to advertise. So, the first thing I would do is negate those, meaning make those a negative so that your ads stop showing up for that phrase. You would do this as a negative exact so that your product would not show up for that search term. And you can do this by just going to your search term report inside Amazon, finding that term, and just adding it as a negative exact to that ad group or to that campaign. That’d be the first thing I would do. And then other than that, I would adjust your bids to make sure that your campaign is running the whole day. If you find out that your campaign is running out of budget, you know, early in the day, you can either add more budget to it or just dial down your bids a little bit so that they stay on there longer, so you gather more data. That’d be the first couple things I would do.
– Yeah, getting rid of those poor performing search terms out of automatic campaign is such an easy win on your ads. I mean, that’s where the majority of money is wasted when people advertise. And when you hear someone say, “I ran some ads on Amazon and it just didn’t work, “spent a whole bunch of money, didn’t get a lot out of it.” that’s usually why. You’re not negating those terms out of your auto campaigns. And the auto campaign, its function is keyword discovery. You have to treat it that way. That’s a huge part of optimizing your campaigns is making sure you find out relevant keywords that convert. Well, that’s how you do it, by testing it either in auto campaign or some other form of keyword testing, like a broad or a phrase match. That’s how you’re going to do it. So, when you treat it like that and then you don’t touch it, it’s just gonna spend a whole bunch of money on testing, right? But if you treat it as a testing campaign, and as soon as you figure out that those work or don’t work, you either negate them or get them out of there and put them into a manual campaign where you can adjust the bid at the keyword level. That would be the second part of optimizing ads is you can’t adjust the bids in an auto campaign at the keyword level. So, you can put them in a manual campaign, make them a negative out of the auto so that you’re not competing against yourself on the bids. And then, start looking at the data and adjusting the bids at the keyword level, which is the next step into it is this is where you’re gonna figure out your goal. You know, what is, if your goal is you’re in a launch phase, then your target A cost might be higher than if you’re in a mature phase where you’re trying to get it down and get your ad spend to be profitable, but either way, you need to make those adjustments periodically, whether it’s weekly, daily, monthly, the more often the better, or you’re adjusting those bids on keywords so that you can stay within your target A cost.
– Yeah and doing like an auto campaign, you know, this used to do these all-time, these auto campaigns. And what I’ve found is that they tend to have a high A cost. So, when I use my auto campaign is now is just like you mentioned keyword discovery. I’m just trying to find keywords. And then if I find a certain term or certain keyword that I want to target, I’ll just take that out, put it in a manual broad, but it as a broad match. And then that way I’m just bidding on that specific term, instead of a broad match. And then now, it’s kind of like a wide net, but it’s kind of narrowed down a little bit more just to those keywords. So, you know, now when I run auto campaigns, it’s maybe for a short period of time just to gather some data and then I’ll transition over to more of a manual, either a broad phrase or exact, try all three, choose one or the other, but that’s kind of where I’m going with my auto campaigns moving forward. And then to your point, about A costs. Again, we talked about it like, are you on page one? Yeah, lower costs would be great, but if you’re ranking a product, you know, look more towards, you might have a more of a higher A cost because you’re trying to improve your ranking. Let that run for a couple of weeks, keep track of your keywords, see where you’re ranking at. Helium 10 has a good tool. Jungle Scout has a good tool where you can kind of track keywords, but once you achieve that ranking, maybe you can dial that back down to more of a profitable A cost. So yeah, that’s kind of like the overview, but to your point again, know your goal and then optimize to reach that goal.
– And, we’ll touch on some more about optimization in a second, but this brings into the point of where tools can help, tools like Sellozo that can, I mean, if you don’t want to go into your search term report on a daily basis and pour through it and make all these bid adjustments daily, you can use a tool like Sellozo where all you have to do is set your goal, like a target A cost of XYZ percent. And then the tool will actually make those adjustments for you on a day-to-day basis. So, there’s a lot of power in terms of automating the process, that way you can focus on the strategy. And again, you can always reach out to Kris or myself.
– You’re Dustin.
– I’m Dustin. You can reach out to us. You can go to Sellozo.com and book a demo with either one of us. And we’ll spend time talking more about how Sellozo can help automate the process of optimizing your campaigns for you. But now, digging in a little bit more in terms of optimization, part of it has to do with the amount of budget that you have, is what approaches you take. For example, like you mentioned, just running an automatic targeting campaign can be unbelievable keyword testing and unbelievable discovery, but it can also be unbelievably expensive.
– Yeah, I mean, you’re paying for data. You’re paying for data there. And we’ve talked about this before, like using tools, like keyword research tools, again, like, you know, in, you’re gonna be able to start with a good base of like, keywords that you want to focus on that will kind of eliminate need of an auto campaign. If you don’t know your keywords or you don’t know where you’re gonna show up for, you could always use an auto campaign, but yeah, be ready, ’cause you’ll spend some money on an automatic campaign.
– Yeah. And that’s why when you launch an auto campaign, you need to begin optimizing it just so you’re reigning in all that waste. You’ve got to get rid of that wasted spend. But you can’t tell if it’s wasted spend until you test it. Now, other ways that you can optimize your campaigns more efficiently and maybe grow a little slower is by just starting off with a few select keywords that you want to try to rank for, and then put those in a campaign and be more aggressive with your bids, so that you’re ranking for those. And then take a similar approach, bid high, start generating sales, start seeing what’s happening, start seeing if your ranking impacts your organic sales. And then obviously, you need to adjust your bid so that you’re profitable long-term, but this will give you, this will allocate all of your budget to just a few keywords so they can rank. And that’s the opposite approach as to sort of casting a wide net and just testing everything.
– Yeah and if you’re on a budget restraint like you got a certain amount of money you want to spend a week or a day, this is what I would do to what you just mentioned is like do exact match, focus on like your five to 10 keywords. That way all your budget goes to those keywords. You can improve your ranking on those keywords, something to your points, as far as bid adjustments. There’s a spot in your campaign settings where you could add a multiplier, where you can like do like a five, 10, 20. You can all go all the way up to 900 if you want. You can add a multiplier for top of search placement. And then anytime your bid is adjusted, that multiplier is gonna get added to that bid and it’ll move it to that top of search. So I’ve done this in the past where I’m trying to rank for like two or three keywords. I’ll put them in separate campaigns. I’ll give them one their each own little budget. I’ll start out with the suggested bid. And then I’ll add a like 250 or 300% multiplier on top of that suggested bid in the settings. And then I’ll just let it run for a couple of weeks or maybe even longer. And then track my ranking to see if it’s improving my ranking. It will, it’ll take a little bit of time, but you’re gonna spend whatever 30, 50, 100, whatever your budget is a day, but that’ll pay off in the long run as you maintain that ranking. So, if you’re on a limited budget, find like your five to 10 keywords, or maybe just your top five keywords put them in an exact match. Start out with the suggested bid, add a multiplier, figure out your budget and then just let them run. And you should see your ranking go up.
– To piggyback off that point, which those are all great points Kris, is, again, depending on your budget could determine which keywords you select. I mean, there’s always gonna be a main keyword for your product.
– Good point.
– And we use this, I mean, if you’re selling a dog leash, the main keyword is dog leash. But if you focus on that keyword, you may not be able to rank or it may cost a lot of money ’cause it’s so broad or such a broad term. But if you focus maybe on four or five, much longer tail keywords and you spend all your ad budget there, you might be able to much quicker rank for those. Obviously, the visibility and the sales volume might be lower on those keywords, but you can get to top of search affordably and then you can take that and just keep moving onto the next keyword. So there’s a lot of people out there that take the approach that I’d rather rank high for 10 long-tail keywords than one main keyword. You know, if it in total equals the same kind of volume and you can make that approach affordable. So there is that. That’s another great just tactic to go. So I think what we’re describing here, and when we’re talking about optimizing it, we were talking about how vague that is. Oh, I need to optimize my campaigns. Yes, but to what end are you optimizing it? That has to be, and that’s what we’ve been talking about here. And that’s where, when you use something like Sellozo, all your planning is that what end, okay? If I want to rank high for five long tail keywords, I can set that strategy and I can now automate that or do it by hand, but I’ve got to focus. And it’s all dependent on budget, category you’re in, competition level, I mean, you have to have a good understanding of all of that to then design your strategy. So, there is no just, “Oh, we just optimize our campaigns.” There’s no dry thing. And that’s something else we talk to a lot of people all the time about, is, you know, A, we want to really improve our sales on Amazon, we’re, you know, whatever their goals are, and then, and we also want to really reign in our ad spend. And you’re like, “Well, those goals don’t merge.” You can do one or the other. That’s not, well, that’s gonna, oh, so, that’s not really. You got a friend in the background there?
– Perfect timing, FedEx just showed up.
– Oh yeah, nice!
– What’s the products here, products being delivered?
– I don’t know what’s gonna be here. This could be some dog food or something, I’m sure. Dogs I tell ya.
– New shipment arrives though. But.
– I saw it coming down the street and I was like, “Ah, here we go!”
– Well, you got good guard dogs there, so that’s awesome!
– But just getting back, I mean, that’s why it’s good to have a conversation like this, about what optimizing campaigns means, because it, it means a lot of things and it’s definitely not reducing your ad spend.
– That’s a very small aspect of it. And now, when you talk about how many types of advertising options there are on Amazon, you’ve got the ability to do like, defensive advertising. You can go after competitors, you can make sure that your listing is covered with nothing but your own products by using, you know, product targeting and sponsored display. I mean, there’s so many things that you can optimize towards a strategy around, but again, there is no one size fits all optimization.
– Yeah and you can do like the same type of strategy you do for sponsor product. You could do the same first like sponsor brand. So, you know, if you’re gonna take the top of search placement for all those keywords, create a sponsored brand ad, with that keyword in the title somewhere in the, on the, whatever they call it, the description of the brand ad, you could put that in there, so when people come to, when they type it in, that keyword that they’re targeting or are going after and looking for, it’s gonna be in that sponsored brand ad. So, and then you’re gonna have product ads below that. So, you can kind of like, take over the whole area for that search term.
– Yeah, which is a whole nother strategy of optimizing, is basically just being the only thing that somebody sees, you know, ’cause you could have the headline ad, the sponsored brand ad that’s at the top. You could have four different variations of your product and the four sponsored product spots. And hopefully, you’re the number one organically ranked product. I mean, it could be the only thing that anybody sees. And, like on your product, when they go down to see sponsored products that are similar to yours, it’s all your other products, it’s all yours again. There’s so many ways to do this, that you just, the key is though, you have to outline a plan, and then stick to that plan, is the key to optimizing. I can assure you that I’ve made every possible mistake. I run automatic campaigns too long without making enough negatives and getting them out of there. I’ve wasted ad spend. There’s a ton, but, so let’s just go. Let’s say someone was using a tool like Sellozo. Let’s go through just some basic optimization, just quick, how can we optimize our campaigns? So, number one, all I’ve been doing is running an automatic campaign. So, I’ve got all this data from this automatic campaign, the quick win there is just to attach or pull those into, all those successful keywords put them into a manual campaign as exact matches, negate everything that’s not working and negate all the keywords you moved over. That’s such an easy, quick win right there. Now, let’s say I’ve got a big budget Kris, I’ve got a big budget and I’m ready to take over Amazon and I’m willing to spend money quickly. How would you set up a campaign structure to optimize as fast as possible with a big budget?
– Yeah, well, I’ve been trying this lately and I really liked it. It’s taking all my keywords that I’m targeting, the ones that I know have high search volume, and I’m putting them in their own individual manual campaign with their own budget and their own bid. And I’m putting a multiplier on it. That way that budget is only attached to that keyword. And I can control the placement with the multiplier and then all my other keywords are gonna get their own budgets. So, if I got a lot of budget to spend on my keywords, I’m creating all separate single keyword campaigns, all exact match with like 200 or 300% multipliers on all those. And I’m letting them run. You’re gonna get a lot of spend, but you’re going to get, you should get a lot of sales if your listings are optimized, meaning they got good titles, bullets, descriptions, photos, and you should see your rank go up. I’m doing the same thing on my sponsored brand. I’m going after all those keywords in their own sponsor brand campaign with that keyword in the title of the sponsored brand and I’m going after those heavily. I’m also doing the same thing in sponsored brand video ads. And they’re doing their own campaign and sponsored video ads. So, I’m gonna have potentially 50 or so campaigns, all single keyword campaigns, all different types, sponsored brand, sponsored brand video and then sponsored product. All the budget’s gonna be allocated to just those individual keywords. But, when somebody types in “Dog brush for short dogs” or “Short hair dogs”, short dogs, “Short hair dogs”, my ad is gonna show up at the top and it’s gonna say, “Dog brush for short hair dogs” in my sponsored brand video, or in my sponsored brand ad, my video is gonna be playing underneath that. I’m gonna have a product ad at the very top of that. So, I’m gonna be everywhere on that page just to try to capture a lot of sales, get my ranking high. So, that’s what I’m doing if I have a big budget, I’m separating everything out in a single keyword, everything’s getting its own budget, and then I’m being really aggressive on the bids.
– That’s great, that’s a great strategy, Kris. And I think that this, the great segue into the last thing about optimizing your campaigns and tracking what really matters, like a strategy like you just laid out can be scary to people. Oh, big budgets on each campaign for keywords. And we’re gonna be in your 300, 200, 300% multiplier, it starts getting scary. But, if you’re tracking your total A costs, which is not calculated inside your campaign manager, you have to calculate it yourself or use a tool like Sellozo to see your total A costs, which means it’s including your organic sales into the calculation of your A costs. Then you will know that you might still be profitable, even with all of that, because of your driving, what you’re doing in a situation like that is driving a bunch of advertising traffic so that you can get your ranking to move up. And if it moves up, you’re getting more organic sales. So, you need to calculate that so that you’re seeing the impact of your advertising. And if you’re tracking that, then you’ll be able to continue that process like that with confidence, knowing that you are still profitable per sale. So, I think that’s the real end game. The real end game of optimization is making sure that your sales go up and your total A costs stays profitable. If you can hit that, then you can be aggressive like you’re doing and showing up on it. ‘Cause all that stuff’s gonna help drive more sales. And the more sales, more organic. So, there’s a lot to optimization.
– And a quick tip there. And a quick tip there, like, add a coupon to the listing. That’ll help your conversion rate. That’ll help you rank faster. So, you don’t have to do it for a long period of time. You could add it for a couple of weeks, but just add a coupon to your listing. And when people see that in the sponsored ad placement, your conversion rate will go up. Your ranking will go up. It’ll help you get conversions faster. So, do that as well, ’cause that’ll help.
– Great point again, like we always say, use every single thing Amazon has to offer to help you out. There’s lots of things that you can do to differentiate yourself. And that’s a great point about the coupon. So, that’s optimization. I know that we went all over the place. We’ve done a little bit of a rabbit hole, but that’s, the best way to sum up optimization is that there is no way, to sum up optimization. It is based on your strategy and what you’re trying to do. So again, we would love to get on a call with you guys out there. We’d love to talk. I mean, this is our sweet spot. This is what we do all day every day is help people optimize their advertising. Sellozo is a phenomenal tool to help you do that. So like I said, go to Sellozo.com, request a demo. You’ll get on a call with either Kris or I, we’ll screen share with you, we’ll walk you through the platform. Once you sign up, Kris and I will onboard you. So we’ll get there and we’ll talk more strategy, we’ll help get your campaigns set up and started. So, take advantage of us. We’d love to be talking with you. Even if you just want to talk Amazon, book the demo.
– We’ll talk about anything with you and help you out. So Kris, that was fun. Again, can’t believe this was episode 30! We are cruising along. Seems like just yesterday, we started doing this, which it almost was.
– It’s been fun, I love it. I mean, obviously we, you could tell the passion in both of our voices about Amazon. So, it’s fun, we enjoy talking and hopefully, people are getting good tips out of this.
– Yep, absolutely. All right, well we will see everybody tomorrow on the next episode. We’ve got some more great guests lined up in the next couple weeks, so we’re excited about that. Make sure you go to Sellozo on Facebook, like the page, we go live with these on YouTube, Facebook, and coming up soon we’ll be live on LinkedIn, so if you like our page, the Sellozo page there, you’ll be able to get notifications of when we go live. Go to the podcast platform of your preference and subscribe to the podcast, that’d be great. You’ll get notifications of when we have a new episode, which is almost every single day. You don’t want to miss out on the great people that we talk to. It’s fun to listen to us hopefully, but our guests are amazing! So.
– Yeah, that’s a good one! So, we’ve got more coming.
– Oh yeah, so that’s a value right there. So, please go subscribe to the podcast and reach out to Kris or I, if you’re ready to do a demo. Kris, we’ll be back at this tomorrow. Everyone have a great day. See ya!
– See ya!