In recent years, Amazon has invested a lot of resources in the development and improvement of its advertising platform. It allows Amazon sellers to create campaigns to promote their products and pay only when users click (PPC). Through advertising, Amazon has an important revenues stream and its share of global advertising spending will reach 8% in 2023, with $230,000M.
Complexity in setting up effective strategies and analysing the results of Amazon PPC has become a nightmare for many sellers. Very often sellers look for quick fixes, for example working with automatic campaigns that don’t always work out well. They also rely on external free platforms and tools that promise to make campaign management easy and efficient but (almost) never work. Nothing could be further from the truth. There is no magic pill that can help them solve these problems.
Behind a successful Amazon PPC campaign lies a lot of work of strategy and research. Big brands hire the best people in the industry to make sure everything goes smoothly. But don’t worry, there is also hope for smaller sellers looking to place their products on Amazon. It is important to approach the game with the same level of professionalism and use the same strategies as the big players. Implementing good advertising strategies from the start can save you a lot of headaches and avoid unnecessary loss of money.
In this article, you are going to discover the 7 most common mistakes that sellers make when launching their campaigns for the first time and how to avoid them.
Discover the top 7 mistakes brands make in their Amazon PPC campaigns and how to avoid them.
Advertising on Amazon, as we have discussed, is becoming increasingly complex and costly. We are facing raising CPC costs in every category, and the platform is frequently renewing and offering new ad placements and analytics.
Before starting, it is necessary to have a clear strategy and define it according to the objectives you want to achieve.
It is often suggested to “always start with an automatic campaign”. This is not always the right decision and can cost you a lot of money.
Let’s share some approaches to consider before launching PPC campaigns on Amazon taking into account the objective and the action to be taken:
- Generate Profit – keep ACoS% below profit margins
- Launch a new product – Auto / manual campaigns with broad targets. keep ACoS% above profit margins
- Branding – Combination of your own brand + product keywords.
- Ranking – Use high volume keyword
- Steal Market Share – target competitors with PAT Ads
- Clear stock – aggressively increase bids, even higher than the ACoS% target.
One of the most common mistakes is not organising and structuring campaigns correctly. Examples of poor structuring include placing all products within the same ad group or campaign or grouping them incorrectly (i.e. separating variations).
When creating campaigns, one option is to create one per ASIN, that is to say, for each of your products. If you hve many products, you can create a campaign that groups similar products together. If you have products with variations keep them in the same campaign but in different ad groups. This will make it easier for you to manage and to control your budget.
Quick tip: once you have the core campaign structure in place, you should not change it every othr week, as it will be difficult to extrapolate old data to new campaigns for the same products.
The use of automatic campaigns may seem like a quick fix for many sellers, but it is not always the best solution. It is important to understand the pros and cons of this type of campaign to assess what is right for you:
- Automatic campaigns: require less effort, keywords are automatically determined by Amazon’s algorithm by extracting them from the title, description and other sections of your product listing.
On the other hand, the targeting of these campaigns is less accurate and you may be wasting a lot of money with showing ads to people to whom they are not relevant.
You should not bid too high on automated campaigns as the budget can skyrocket with irrelevant impressions and clicks that don’t convert.
- Manual campaigns: require much more time and dedication in terms of keyword research and bidding. However, they are much more precise in targeting and therefore the ROI, if properly set up, is much higher.
To help you set up your manual campaigns, you can use your automatic campaigns by taking into account which search terms are performing the best and use them in your manual campaigns with broad match.
As we mentioned earlier, you shouldn’t fall into the trap of making too many changes too often. It is best to check the performance of your Amazon Sponsored Products frequently, but avoid changing campaigns every day. You should plan when you are going to make changes and what kind of changes you are going to make, unless there is some emergency that requires immediate action.
One rule is that bids can be changed more often than the campaign structure.
If you change campaign keywords every two days, you won’t get enough information and data to make good decisions. This is a continuous learning process. Look at different periods and identify trends. Be patient in the beginning to get the best results.
- Relying too much on PPC Tools
There are hundreds of tools that can help you extract keywords for your ads but relying only on them thinking that AI will do is not a good idea. Many sellers think that by using these tools they will no longer have to worry about defining keywords for their campaigns and avoid wasting time and money on hiring a professional to do it for them.
The truth is that the best tools work well for managing bids, they give you a granular understanding about performance and best keywords but they are not magic. It takes experience to use them to the fullest and interpret their data properly.
You won’t expect your friend driving a F1 Ferrari to win the race, won’t you?
It’s the same with PPC, the driver plays a huge role. Nowadays competition is very high and you are competing with professionals and agencies with years of experience.
Bidding on your own brand’s keywords is very important for two main reasons:
- Customers who fell in love with your brand the first time they bought will be able to find you easily.
- Your competitors will have a harder time bidding for your brand. The CPC of your brand’s keywords will be higher and it may not always be profitable for them bidding to appear before you.
Remember to always try different keyword combinations.
Not using a strategy that includes negative keywords will result in your budget rising and your conversion rate dropping.
Negative keywords help sellers exclude several unwanted terms from customer searches. Good use of negative keywords can help you target your campaigns very well, avoid clicks that don’t convert and help you better control budgets.
There is no set rule on how to decide which negative keywords are most suitable for your products. Depending on the product’s lifecycle stage, your previous data, the type of keyword you could pause a keyword after 5 or after 20 clicks with no sale.
These are just some of the most common mistakes among Amazon sellers. Moreover the platform is always changing and evolving.
Mastering Amazon PPC campaigns requires a lot of experience,study, hard work, a/b testing and time.
Most of the Private Label sellers lack those and proper the resources to be competitive in the current market. Especially now that many big players, such as VCs funds and aggregators have come into the Amazon space.
That’s why there are specialised Amazon partners like ours that help brands like yours cut PPC costs, increas revenues and scale up fast in Europe.
Grab your free PPC or account audit today. It’s your first step to start growing on Amazon with better profit margins. Click here to get the offer.
To your success!