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Campaign Budgets on Amazon

Best Practices / July 11, 2018

Do you often wonder, “When should I change my campaign budgets on Amazon?” It can be tricky to figure out when and how to adjust your campaign budgets. There are a number of factors that should be taken into consideration before making your decision. It’s first important to understand how budgets work within Amazon PPC.

There are two types of budgets that you can set within Amazon Sponsored Products: average daily budgets for individual campaigns and fixed daily account budget.

Fixed Daily Account Budget on Amazon

We’ll be focusing on average daily budgets for individual campaigns in this blog, but here’s a brief explanation of fixed daily account budget:

You can set a daily budget cap for your account, meaning all your campaigns will be paused once the total spend between all running ad campaigns has been met for the day. This is a fixed value for each day and your total spend for each day will not exceed that value. For example, if you have 2 campaigns running within your Amazon Sponsored Products account and each one has an average daily campaign budget of $30 but your fixed daily account budget is set at $50 then your ads will pause once the total ad spend for the day reaches $50. So, if one ad spends its entire budget of $30 and the other campaign spends $20 before noon on a certain day, both of your ads will be paused for the rest of that day. This is helpful if you have a set amount of marketing dollars you can spend, whereas average daily campaign budgets are better for more flexible marketing budgets.

Campaign Budgets on Amazon

At the beginning of your time selling on Amazon, there will be a period of learning what keywords work and don’t work. During this time, it should be expected that you will lose more money on your campaigns than normal. Once you have established enough information based on this learning phase, you’ll be able to know, in general, what your campaign performance should be. Of course, there will always be cases that will cause dips and spikes, like dips in sales over holidays or products being featured on websites that cause a buzz and higher sales. But outside of these kinds of scenarios, after you’ve learned enough about how your campaigns will perform, your campaign budgets should spend throughout each day in a somewhat predictable manner.

When considering your campaign budgets on Amazon, you should always set your budgets at an amount that you are comfortable losing.

Adjusting your average daily budgets for individual campaigns correctly takes some finesse. You want to make sure that your budgets are set just right to give you the most sales possible. But how do you know when to change it, and whether to raise or lower it?

If your ACoS (advertising cost of sales) is within your target range, and your campaigns are fully utilizing their daily budgets, then it could be time to raise your campaign budgets. There is more profitable traffic to be had, so you want to make sure you are optimizing your campaign budgets on Amazon to capture as much of it as possible. It’s important to remember that since your ads stop running once the daily budget has been spent, if your campaign budgets on Amazon are too low then your ads may spend their whole budgets quickly each day and you will miss out on traffic for the rest of the day.

In the event your campaigns are not reaching their daily budgets, or you have one campaign (or more) that isn’t performing as well as others, you can lower that budget and reallocate it to campaigns that are performing well in order to capture more traffic.

Adjusting bids on individual keywords can help optimize how your campaign budgets on Amazon are spent. But manually adjusting the bid for each keyword when you have hundreds, or even thousands, of keywords can take a lot of time. Sellozo fully-automates your Amazon Sponsored Product Listings by automatically adjusting your keyword bids based on historical performance data. This can save you on average 8-10 hours of work per week. Plus, you retain control of your campaign budgets on Amazon, so you’ll never spend more than you’re comfortable with.

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