Amazon PPC, also Pay-Per-Click, is an Amazon advertising model where advertisers pay a fee each time their ad is clicked. It’s a way for sellers to promote their products on the Amazon platform, increase their visibility to potential customers, and drive sales.
However, monitoring and optimizing the proper metrics is essential to maximize the impact of your advertising efforts and expenditures. That’s why we gathered all the information you might need for optimizing different campaigns, tracking tools, and helpful data analysis tips.
The Importance of Managing Advertising Campaigns
Effective management of Amazon advertising campaigns is the ‘must-have’ for each Amazon seller. This is a basis that will save you money and:
optimize the visibility of your products on Amazon;
ensure you use the appropriate keyword targeting and your Amazon ads are shown to users searching for products related to your business;
identify underperforming Amazon PPC ads by using metrics such as click-through rate (CTR), conversion rate, and ad placement.
Key Metrics to Monitor
The main metrics are divided into 2 parts:
those that show the overall result and traffic’s cost — ACOS, ROAS, CPA, CPC;
those that show the stages of the client’s funnel — CTR, CR.
However, the primary metric for your Amazon PPC campaign might vary based on your unique business goals and advertising strategy. So, let’s dive in and discover what works best for you.
Conversion Rate (CR)
Conversion Rate calculates the ratio of conversions (sales) to clicks on your ads. A high conversion rate means that when users click your ad, they’re not just looking around but actually buying your products.
Conversion is the overall evaluation of your product. However, to get a good conversion rate from advertising, you need to show ads in the right place at the right time. Advertising conversion might be better than organic conversion; if not, you check what keywords you target and try to work on optimization.
Here’s how you can make sure those clicks turn into sales:
showcase with quality: use high-quality images and video demos to reveal your product, earning the trust of potential customers;
details matter: provide a comprehensive product description, including features, benefits, and competitor comparisons;
create urgency: implement promotional tactics like limited-time discounts, coupons, and price cuts. Such a strategy encourages buyers to check out your product;
reviews make sense: engage your clients to leave positive feedbacks, as they have a great impact on CR.
Cost-Per-Click (CPC)
Cost-per-click is the fee you pay Amazon each time a customer clicks on your ad. Keeping this CPC figure on the down-low is crucial for maximizing your ROI.
Since CPC is a measure of traffic, keys with a high search volume will have a higher CPC, while long-tail keywords generate a lower CPC.
How to optimize CPC?
Target keywords directly linked to your product or niche.
Exact match type should be about 60% of total spend, this will help prevent your ads from irrelevant keywords, slashing the cost of clicks that don’t align with your goals
If your organic ranking is top-notch, consider playing it smart with lower keyword bids. Position your ads at the Rest of Search, maintaining visibility while keeping CPC in check.
Click-Through Rate (CTR)
Click-through rate is a metric that measures the percentage of people who click on an ad after seeing it. It is calculated by dividing the number of clicks by the number of impressions (views). A high CTR determines the effectiveness of your ad campaign.
If your ad campaigns are struggling with a low CTR, here are some tips to turn this around:
choose high-resolution main images that also show value and competitive advantages for your products;
capture customers’ attention by using promotional tactics, such as adding coupons to your product listings;
consider boosting your ad budget to place higher bids for top-of-page 1 visibility or top-of-search, as it has higher CTR.
Advertising Cost of Sales (ACoS)
Advertising Cost of Sales measures the effectiveness of ad spending and represents the ratio of ad spend to sales generated from those ads, expressed as a percentage. A lower ACoS indicates more efficient ad spending.
To optimize ACoS in Amazon PPC campaigns:
target keywords directly related to your product to attract more relevant clicks and improve ACoS;
negate search terms that make no sales or produce high ACOS;
adjust bids strategically to get enough visibility, but not overpay for a click;
ensure your product listings are compelling, accurate, and aligned with customer expectations to enhance conversion rates;
rule out underperforming ad placements to avoid unnecessary ad spending on placements that don’t drive sales.
Return on Investment (RoI)
Return on Investment (ROI) is a way to measure how much profit you’re making compared to what you’re investing in your Amazon PPC campaigns. It’s like figuring out if your efforts and money spent on advertising are paying off. ROI helps you see if your advertising is efficient and if it’s bringing in more revenue than it costs.
For Amazon PPC campaigns, a positive ROI means you’re making a profit. By monitoring your ROI, you can tweak your campaigns to focus on what’s working best.
If a specific keyword or ad gives you a higher ROI, you should emphasize that and optimize your strategy for better results. It’s a way of ensuring your advertising efforts on Amazon effectively boost your business’s success.
Return on Ad Spend (RoAS)
Return on Ad Spend (RoAS) means how much money you make for every dollar you spend on advertising. Its an opposite calculation to ACOS. This metric helps you understand the effectiveness of your Amazon PPC campaigns by showing the revenue generated from your advertising costs.
How it helps in optimizing Amazon PPC campaign:
RoAS indicates if your ads are making more money than they cost. A RoAS of 5, for example, means you’re making $5 for every $1 spent;
it helps you allocate your advertising budget wisely. Focus more on campaigns with higher RoAS to maximize profitability;
RoAS guides strategic decisions, allowing you to optimize your advertising strategy for better overall performance and profitability.
Tools for Monitoring Amazon PPC Campaigns
You can efficiently monitor your PPC campaigns by using the following tools and platforms:
Amazon Advertising console
Amazon Advertising console offers specialized data and reports crafted for Amazon PPC campaigns. Here, sellers gain access to comprehensive metrics, including impressions, clicks, spending, and ACoS. It can help you to fine-tune your Amazon PPC ads effectively, making data-driven adjustments for optimal performance.
My Real Profit
My Real Profit is a powerful third-party tool that can also analyze your Amazon PPC data. It provides keywords & search terms analysis, product-level PPC performance, organic vs PPC, and much more. You can easily track, optimize, and improve your Amazon PPC campaigns regularly with it.
How to Optimize the Campaign Performance
Here are a few ways how you can optimize the campaign performance.
Start by implementing a systematic approach with intuitive campaign naming conventions like ASIN – Ad type – Match type – Keyword. This not only streamlines your workflow but ensures quick navigation.
Maintain a structured setup: one campaign, one ad group, and target five keywords. This strategy allows your budget to efficiently cover all keywords, delivering more comprehensive results.
Do not deactivate campaigns too early. It takes around three days for all the data to be processed & provides a more accurate representation of performance.
Regular Keyword Review
Regular keyword review is about consistently assessing and analyzing the performance of keywords used in your Amazon PPC campaigns.
To do it efficiently, you have to monitor search term reports, identify new and relevant keywords, remove underperforming or irrelevant terms, and adjust your keyword strategy to meet current market trends.
Competitor Analysis
Amazon sellers use competitor analysis to track and understand the strategies employed by their competitors in the same product category. This includes examining their product listings, pricing tactics, ad strategies, and customer reviews.
The goal is to gain insights that can inform and optimize your approach and help you stay competitive with the improved performance on the platform.
Tips for the Efficient Data Analysis
Set Clear Goals
Setting clear goals will help you focus on the most critical metrics that will guide you toward achieving your desired outcome.
Try Visualization Tools
Use data visualization tools like graphs, charts, and heat maps. They present information in an easy-to-understand way, making it a breeze to identify areas that might need extra attention.
Compare Periods
Check out for trends and patterns in how your metrics change. Comparing over different periods will reveal where you’re excelling and where you might need to adjust to keep the success going.
Categorize Your Data
Categorize your data to figure out which products, keywords, or campaigns are doing well and which ones could use some help. This way, you can direct your optimization efforts where they’ll have the most impact.
Conclusion
Analyzing your Amazon PPC campaigns is like guiding your advertising toward success. By delving into the metrics, you uncover what works and what doesn’t.
Moreover, understanding the nuances of analyzing data empowers you to make informed decisions, allocate budgets for the ad spend effectively, and refine keyword targeting. It’s not just about numbers. It’s the key to unlock the full potential of your campaigns.
FAQs
Where to monitor Amazon ads?
You can use Amazon Advertising console tools or try out third-party analyzing tools such as My Real Profit.
Why is it important to monitor Amazon PPC campaigns?
As for sellers, it’s essential for improving strategies, maximizing ROI, and staying competitive on the Amazon platform.
What are the key metrics to focus on when analyzing Amazon PPC data?
The most critical metrics are Click-Through Rate (CTR), Conversion Rate, Cost-per-Click (CPC), Advertising Cost of Sales (ACoS), ROI, and others.
What should I do to optimize my Amazon PPC campaigns?
Explore tips and techniques for leveraging your data to make informed decisions, refine keyword targeting, and enhance overall campaign performance. You can also check the advertising via the A/B testing and competitor analysis.
How often should I monitor my Amazon PPC data?
It’s better to do it regularly. However, the frequency also depends on various factors such as your campaign objectives, budget, and the competitive landscape.
