3 steps to optimizing your Amazon Sponsored Products campaigns for success
Editor’s note: This is a guest post from Elly Duker of Teikametrics.
Amazon’s Sponsored Products (SP) is rising in popularity among sellers as a key product marketing tool. It’s the next step in expanding your business on Amazon.
At this point, if you’re not using Sponsored Products, you’re falling behind your competition.
Sponsored Products allows Professional Sellers to intelligently advertise their products on a pay-per-click (PPC) basis. Pay-per-click means you only get charged by Amazon if your ad is clicked on by a viewer. Sellers can choose the keywords they would like to promote or they can allow Amazon to do so automatically using the product’s details. If a customer’s search is related to the chosen keyword, your product is eligible to appear in the results page. The ad spot is auction-based and only applies to products currently winning the Buy Box.
Not all Sponsored Products campaigns are created equal, and optimizing your campaign’s structure will make all the difference to improve your Amazon marketing game plan. Without a doubt, there are best practices and worst practices (countless times we’ve seen sellers fail to realize their campaigns are set up in a way that is hurting rather than helping their sales rank!) when it comes to building the most efficient and optimized campaigns possible. We’ve compiled some of the most important advice from our Amazon experts to help you avoid any major SP mishaps and increase profitability.
There are three essential steps to creating successful Sponsored Products campaigns. Let’s walk through them together.
Step 1: Preparing your campaign
Before jumping into the deep end with campaign creation in Sponsored Products, you must cover your bases. Here are a few campaign essentials:
1. Choose which products you want to advertise. You can pick just a few items or your entire portfolio, you decide. It should depend on your marketing strategy for your catalogue, both overall and at the individual SKU level. However, if you choose to advertise only a portion of your catalogue, you could be missing out because of your unintentional product bias. If you’re not advertising a product, you’re missing out on real estate your competitors are leveraging.
2. Break down your products by category and establish business objectives for each to drive the most relevant traffic to your listings. For example, if you sell shoes, you could break your products down by boots, sneakers, and high heels. Then, break these categories down even further based on your business objectives – we like to call these Activity Based Campaigns. Your ad groups and campaigns should be structured around your different business goals.
- Are you launching a new product or brand? In that case, your goal could be to drive traffic to the listing to maximize exposure.
- Are you trying to liquidate inventory? Perhaps higher advertising on stale inventory will help it move before long term storage fees hit.
- Are you capitalizing on your best sellers? Running SP campaigns can drive incremental revenue for these products.
3. Split out ad groups by product-specific attributes to break down your campaigns even further. Break up your shoes into categories like material type, style, or audience. Grouping products that share similar customer search terms allows for greater keyword relevancy and increases effective keyword discovery for that particular group of products.
4. Understand how your customers are searching for your products. Analyze keyword data from the Search Term Report to see what customers are actually typing into the search bar to find your items. And in your campaigns, tweak keywords or bids with this data as a guide.
Dividing your products into relevant categories is a crucial first step to creating your long term Sponsored Products marketing strategy. Putting in the time and effort to effectively map out your products beforehand allows you to easily navigate and designate products to campaigns and ad groups, minimizing the possibility of having to reconfigure them in the future.
Step 2: Choosing your campaign type – automatic vs. manual
There are two types of campaigns within Sponsored Products: automatic and manual.
Automatic campaigns are the most popular among Sponsored Product users because they require much less maintenance and attention. Many automatic campaign users fall victim to the “set it and forget it” mentality. Automatic campaigns target ads to all relevant customer search terms, as dictated by Amazon. Amazon selects keywords for your campaigns using the product’s title and description, so automatic campaigns will only run properly if these labels are optimized. Since Amazon automatically sets the keywords, bidding is defaulted to the ad group level, giving you little control. One valuable feature specific only to automatic campaigns is that your product is eligible to appear on a competitor’s detail page. This helps you generate more sales, while potentially taking sales away from your competitors!
Manual campaigns allow for greater control over keywords and bids. You have the opportunity to add new keywords, select keyword match types, and adjust bids accordingly. When managed well, these campaigns can be the most effective advertising tool on Amazon’s platform. Unfortunately, manual campaigns can be costly to manage and maintain properly.
The majority of SP users have just one type of campaign running their ads. We do not recommend this marketing strategy as it often leads to a very high Advertising Cost of Sales (ACoS).
Tip: Run both types simultaneously since each have their own individual benefits. We call this an “explore and exploit” strategy.
Here’s how it works:
An automatic campaign generates high quality data over time. It casts a wide net, allowing you to analyze customer search term data and in particular, discover the most profitable keywords to use in a manual campaign. Manual campaigns are used to hone in on those high-performing keywords found via automatic campaigns and to have greater control over the bid.
Tip: We never recommend turning off automatic campaigns because, like all things on Amazon, customer trends and search terms can drastically change over time. To remain profitable with Sponsored Products, you must constantly monitor and modify your keywords.
Step 3: Maintaining campaign organization
Keeping your campaigns organized may not seem like an important task now, but we’re confident you’ll thank us later for this advice.
We believe campaign organization starts with creating a mirrored structure. The number of campaigns within Campaign Manager can add up quickly, especially when running automatic and manual campaigns simultaneously. With this in mind, establishing a mirrored structure and naming convention system at the campaign and ad level group will save you a lot of headache in the long run.
For example, say your shoe business is looking to create an automatic and manual campaign for rain boots. When creating an automatic campaign, we recommend having the word “automatic” somewhere in the title of the campaign (same goes for manual campaigns, too). This would make the title of your campaign “New Rain Boots Automatic” with possible ad group titles like men’s rain boots, women’s rain boots or children’s rain boots. These same ad groups will also be listed until the “New Rain Boots Manual” campaign to keep it simple and organized.
Tip: An efficient way to build your campaigns in bulk is by utilizing a bulk file upload. This is great for sellers that have a larger catalogue to advertise. This template can be downloaded under Campaign Manager’s Bulk Operations tab. The template also includes a tab with required fields for creating campaigns, ad groups, bids and keywords.
Setting campaigns up properly the first time around will help you avoid the headaches of redoing them in the future. Now that you’ve built a sturdy frame for your campaigns, let them run (but don’t forget to manage them!)! Continuously optimizing your campaigns on a weekly basis will ensure that your products are receiving the right amount of visibility and are staying competitive.
- Advertise your entire product catalogue and evaluate SKUs based on objective data
- Run both automatic and manual campaigns with mirrored structures, using an “explore and exploit” strategy.
- Save time by keeping your campaigns organized. Utilize tools like bulk upload to remain efficient.
Top Amazon sellers trust Teikametrics for a data-driven approach to scaling their FBA businesses for growth through an all-in-one software platform that manages FBA inventory, tracks true profitability, forecasts product stock outs, and product repricing.
Founded by a former multi-million-dollar Amazon seller, Teikametrics has recently launched their Sponsored Products Optimizer software. A next-generation application that manages campaigns, automates keyword actions and automatically adjusts bids through powerful automation.
Take control of your Sponsored Products today. Get a free demo of the Sponsored Products Optimizer by a Teikametrics SP Expert!