
Ecom Podcast
#102—Ranking Campaigns on Amazon PPC—How to Setup & Optimize for Maximum Results
Summary
"Learn how to set up effective Amazon PPC ranking campaigns by focusing on single exact keyword ad groups for top-selling products, while avoiding the misconception that high ad spend directly translates to better organic ranking."
Full Content
#102—Ranking Campaigns on Amazon PPC—How to Setup & Optimize for Maximum Results
Speaker 1:
Alexa, play That Amazon Ads Podcast.
Unknown Speaker:
Which one would you like to hear?
Speaker 1:
The best one.
Unknown Speaker:
Okay, now playing That Amazon Ads Podcast. These gentlemen are completely changing the game.
Speaker 2:
After listening to That Amazon Ads Podcast, my ads are finally profitable.
Unknown Speaker:
I also heard they're pretty cute.
Speaker 2:
Getting your product to rank on page one of search results is every seller's dream and a reality for only a select few.
Speaker 1:
And we're not talking about the bottom of page one. We're talking about how you can get your product in the first organic placement on search.
Speaker 2:
We're showing you how you can properly set up and run Amazon PPC ranking campaigns to increase your product's chances of winning that top spot. So this episode comes as a highly requested topic from a lot of different people,
but I just got a comment on LinkedIn the other day from somebody who said, that they would like to hear a podcast on how to run ranking campaigns. He has a lot of questions. This is Tommy.
He says, are these campaigns for ranking certain products higher on search results? Are these campaigns for ranking products higher on specific high traffic keywords? He said,
I run single product campaigns and recently started a keyword campaign where each ad group has a single exact keyword and my five best sellers. I thought this must be a ranking campaign, but now I'm questioning that.
Even if I'm on the right track, should I be negating these keywords from my five best selling product campaigns? Thanks, love the podcast. Thanks again, Tommy, for that comment.
But that's really the narrative and the focus point of this whole episode. We're gonna be diving into how to set up and run efficient ranking campaigns,
how you can start to see your product improve on certain search results, and when to do it, when not to do it, all the details that are encompassed in ranking on Amazon.
Speaker 1:
Yeah, and we kind of covered this topic a little bit. If you search our channel for Carly McMillan, you'll see an episode that we had her on as a guest. She's a super smart PPC manager, and we talked a bit about ranking, but you know,
guests are great, but Andrew and I always love to talk and give our opinions and everything. We're going to be basically just going through how we think through these campaigns.
Andrew and I both use keyword ranking campaigns and so it would be a good Topic to cover, but before we dive into how these campaigns work, it's always important to distinguish between what things aren't and what you shouldn't be doing.
And the biggest thing that people really think happens on Amazon is that keyword spend equals keyword ranking and that there is a one-to-one correlation that however much you spend,
uh, okay, well, In one sense, the ad rank, yes, is connected to spend. So if you're bidding $100 per click, you're probably going to win that top spot in terms of the advertising placement.
But the question is, How can you grow the organic ranking? And a lot of people think that if you just have an unlimited budget on those PPC keywords, then that's enough to get you up to rank one organically.
So Andrew, what do you think about that?
Speaker 2:
Yeah, that is a very common misconception I get from both clients and people that are relatively new to the Amazon space.
But the goal is really to leverage We use PPC to maximize visibility and traffic on a particular term to give our best effort using the tools that we have within PPC to actually grow that ranking.
But there's so many factors that actually go into Amazon's ranking algorithm, but we don't know every single one of them. We can only observe anecdotally what types of things are contributing to that ranking that you're getting.
So Amazon, from what we can observe, really has a lot of factors that they look at. They're looking at your sales velocity over, you know, different look back windows.
They're looking at your reviews, the average conversion rate of your product, the click through rates of your product. How long that product has actually been on Amazon and what kind of history we have built up for that product.
Customer satisfaction is a really big one that we talked about with Carly on the episode. Does it make Amazon money? Does it make the customer happy? If so, you might be performing pretty well.
I've also even seen There are certain brands that if you have a really strong brand presence already on Amazon, that when you launch new products,
they kind of get a natural boost just from that credibility that you've already built up with all the other products in your catalog. So there's a whole multitude of factors that go into actually ranking on Amazon.
This episode is really just kind of drilling into making sure you do everything from a PPC perspective and how to do things from a PPC perspective to maximize your chances and results of getting the products to show up more on certain keywords.
Speaker 1:
Yeah,
and something else that I always think is very important to do in any exercise or question or problem is Take a step back and like zoom way out on anything that you're trying to troubleshoot and think through kind of what are the most basic kind of foundational,
fundamental truths. So Andrew, I'm going to start this off with, it was going to be a rhetorical question, but I'm going to make it just an actual question to you. So zooming way out. To you, what is the purpose of a search engine?
Like you type something in, you get search results. What is that search engine trying to do? What's the core, like one single thing that like, if it does this, it's doing its job. What's the main thing?
Speaker 2:
It's to match the output to the most highly Likely result that you were looking for with that search.
Speaker 1:
Yeah. It's just trying to give you the most relevant thing to your search, right? That's literally the reason why search engines exist. Like when you go on Google, you're looking for something and Google's trying to give you what you want.
And so when people are shopping on Amazon, they are going to give you what they think is the most accurate, the most relevant product. That is a good product. That is a good price point, has good reviews.
They're just trying to give you what you want and try to maximize, you know, your own bang for buck. So you might see like a more expensive item, slightly less expensive item. So you kind of have like, you know, some options there.
And then of course, Amazon's also trying to make money themselves. So they want you, like they're going to prioritize the product that sells because they want the sale.
And they might also prioritize products that they make a little bit more on because they're going to be having, you know, different agreements with, you know, if you're a vendor or whatever, like you're gonna have some,
some different amounts of revenue that Amazon makes from those sales. That's basically all it is. So when people talk about what goes into these, you know, ranking systems and everything like that,
if we just zoom way out and just think, Amazon just wants the best product first. That's why most of the best sellers that are winning the top spot. It's just because it's the best product like hands down, you know.
But what we're going to kind of be talking about are how does the algorithm know these things? There's probably a few different metrics that Andrew started mentioning like sales, velocity, reviews,
conversion rates, click through rates, all these types of things. So we're just going to go through each of those really quickly and then we'll talk about how the PPC can actually play into this.
And how it can increase organic ranking, if at all. But Andrew, why don't you kick us off with sales velocity and how that works?
Speaker 2:
Yeah, so sales velocity, we just mean how many units you're selling on a certain look back window. So Amazon tends to use rolling look back windows of 7, 14, 30 days.
And it's basically just how many different sales of an item you're getting through a particular keyword. And so how fast are you selling through? And if you look at like BSR lists, if you're looking at the number one,
that number one rank in that BSR list is more often than not selling the most units. And as you go down that list, the velocity of units sold and overall volume that that product is doing goes down in proportion to those rankings.
We're just talking about how many units you're selling through and how quickly in a certain timeframe.
Speaker 1:
And what that BSR is calculated from, if it's the last seven days, 14 days, 90 days, whatever, I don't think we really know, but it seems to be some kind of combination of all of the above,
because if you just track the historical BSR for a product and how many units you're selling, you'll see that if one day you sell no units, it's not like the BSR goes to infinity, right?
There is some kind of like momentum based thing where BSR, if you start selling a lot of units, BSR is slowly climbing, slowly falling. It can also have like, you know, big jumps here and there.
But for the most part, it doesn't, it's not like overnight immediately, you know, making gaps, right? Things are like kind of climbing and falling. So that's why we think it's multiple Multiple timeframes, but there's also the brand effect.
Andrew, what do we mean by that?
Speaker 2:
Yeah, by that I was just kind of alluding to, you know, I work with this one supplement company that's been around for about a decade on Amazon,
and they have really well established products that sell a boatload of units every single month. And they're constantly launching new products. And it seems like just from what I've observed, when they launch a new product,
It is tremendously easier for them to get that product some momentum and actually get a little bit of ranking juice and start seeing that product rank pretty well pretty early than it is for just like a completely new seller who has no history,
who just set up this product. It's their first supplement that they've ever sold. You know,
there just seems to be something that Amazon's considering when it comes to that brand's overall presence and how How confident Amazon is in that seller over a passage of time.
And so this brand just has that history to where Amazon seems to reward them a little bit for just that equity that they've already built up and using the platform, selling good products, good customer experience, all that type of stuff.
Speaker 1:
And that makes sense, right? If, you know, if there's someone who has never sold a product before and they're trying to go start selling like a protein powder, There's a lot of unknowns to Amazon. Is this thing even healthy?
What if there's some chemicals in it or whatever? What if people are dying from consuming this supplement? They don't know. So, But if you're an established brand that's doing tens of millions of dollars a year in sales,
and you launch a new product, and you have another hundred products that always do well, there's just a lot more kind of trust there that Amazon assumes that your product is also going to do well.
So we talk about product quality score, but there's probably also something like a seller quality score. And just based on, you know, how good of a job that you're doing with your products,
you're naturally going to get a little bit more of a boost there. So I don't know, I assume, you know, we have product reviews and there's also seller reviews.
The thing that's interesting is a lot of people, I don't think, a lot of consumers, I don't think realize, you know, the difference between seller reviews.
Like it's kind of unfortunate if Amazon makes a mistake with shipping sometimes, And like what's fulfilled by Amazon, people will go review the seller and be like product came damaged or something,
or they'll review the product or whatever. And it's kind of a bummer because it's not like the seller's fault, but reviews in general for both products and sellers are probably the most important thing when it comes to ranking,
just because that's very tangible. And if Amazon's trying to put the best products at the top, The best way to identify what the best products are going to be from reviews.
So I think it's pretty straightforward unless if you have anything to add to that, Andrew.
Speaker 2:
Not really. I mean, it's just one of the biggest indicators of that customer satisfaction. If you have a ton of reviews and really good ratings that then it's a high likelihood that that's a trustworthy product.
If you look at search results, the top ranking ones usually have the most reviews. It's because they've been there the longest. They have built up that customer equity as well.
Speaker 1:
And then the final things here are conversion rate, click-through rate. Those are just pretty basic. That's just how Amazon... This is how Amazon's algorithm works.
They've, you know, this is public information, but they're basically just doing a series of tests of your product versus this search term. They're putting it into search and they're just seeing how that performs relative to everything else.
So, you know, which product has the highest click-through rate specific to this query, which one has the highest conversion rate, and they're just using that to,
that's just the easiest way for a system to understand relevance and quality of a product Product query pairing is basically what it is. So what I do think is important to note there.
What we did not say, and to kind of start dabbling into the PPC side of things, I think a lot of people think that it's not just a search term item pair, it is a keyword specific to a campaign and ad group with a product ad pair.
And that if that keyword, so let's just say you're selling ceiling fans, right? If you've got ceiling fans exact match with this one product ad, In this one campaign,
and then you have, you know, and that's been running for like a few months. And then you create a new campaign with that same exact like keyword.
They think that Amazon like completely forgets 100% of the history that your product has ever had with the keyword ceiling fans and is now starting from scratch. And that's just simply not the case.
Amazon has a long history of all of your products with activity in search and all of that's being factored in.
It's not just exclusively like siloed off where every single campaign is its own kind of individualized history that has no history anywhere else.
Speaker 2:
Yeah, yeah, very well said. That's definitely something You got to keep in mind and one other thing I would add to this whole conversation that I don't think we've touched on yet is just how important outside traffic and outside exposure,
like getting awareness for your brand outside of Amazon can be on influencing rankings on Amazon too. Because you'll see there's a lot of brands who don't run a whole lot of Amazon ads,
but they have their They're product listed there and a lot of their marketing is on like Instagram and Facebook and they're going viral on. TikTok and things like that and not really running a whole lot of Amazon ads.
And so, you know, what's going on there? It's just that people are then are being influenced on another platform.
They're going to Amazon because that's where a lot of people go to start their search for a product and they end up purchasing what they're looking for. And it just kind of ties into everything we've already kind of mentioned before,
like they've just got a lot more sales velocity going through. And so those products, even though they're not Pushing a whole bunch of Amazon PPC spend,
they're still hitting on a lot of those different factors like sales velocity and conversion rates are probably higher because they've already influenced the sale elsewhere.
And so there's a lot to be said there and not going to go too deep into the weeds on that. But we've looked at certain brands where they ratcheted up their influencer marketing efforts where they were first looking,
you know, only reaching out to like 25 or 50 influencers per week, ratchet that up to like 100, 150.
Very clear correlation between their sales on certain products that were being promoted and things like that to those influencer marketing efforts. So something to be said for that as well.
Speaker 1:
Yeah, that actually, that is interesting because I think external traffic probably has a lower conversion rate on the listings compared to on Amazon, people who are actively searching for something, right?
They're already kind of at the bottom of the funnel versus if you brought that traffic in from an Instagram ad. You're talking about direct.
Speaker 2:
You're talking about like if you had an Instagram ad direct to Amazon. Yeah, and I'd imagine that most people aren't really doing that or there are definitely people doing that for sure. Google ads, Facebook ads directly to Amazon.
And you're right, probably is a lot lower conversion rate. But even the ones that aren't, if they're just like driving that to their D to C site,
those ads are still getting seen by so many people and Amazon is such a natural place to go look for it because you can get it faster. free shipping, all that type of stuff. So people may see the ad and not buy it on the DSC site,
just go to Amazon and search for whatever it is and quickly purchase that.
Speaker 1:
But I think some people wonder if they are driving external traffic to the listing. If that traffic is a lower conversion rate, if that's going to hurt their ranking,
I personally don't think so because I think the ranking is mostly connected to the search term itself. So if anything, like if we're considering like what's kind of going into the ranking, part of it is just sales velocity.
So if you're driving external traffic, that's growing the total sales velocity, that's also contributing to more reviews. So that's gonna be a net benefit for your ranking kind of in all relevant searches.
But if that's a lower conversion rate compared to when people are looking for ceiling fans specifically or something like that,
I don't think it's going to hurt your impact there because the ranking for that keyword is more specific to how it performs when that search term is entered into the search query.
Speaker 2:
Gotcha. Yeah, no, that makes sense. I would align with that. I don't really think that it necessarily hurts to push lower converting traffic. Amazon tends to like that external traffic coming. You're sending more customers their way.
They built a whole referral program around that to give you a kickback whenever you're doing that. So I don't think they're like punishing you for lower converting traffic.
It's kind of to be expected from depending on where you're sending it from.
Speaker 1:
But anyway, so Andrew, talk to us about these keyword ranking campaigns. What's the purpose? What do they look like? How do you set them up?
Speaker 2:
Yeah, let's dig into it. We spent the whole first half of this episode kind of talking about the concept of ranking and everything that goes into it. But let's get down to the nitty gritty and actually how to set these things up.
The real purpose, I think I mentioned this before, the real purpose of a ranking campaign is to maximize visibility, traffic, and ultimately sales on a given search term.
Ideally, that's a high traffic, high volume search term that you're trying to get yourself exposed on a little bit more. When it comes to setting these up, the main place we got to start is at our campaign structure.
In our original question, Tommy said that he has a I have a single exact match keyword in five different ad groups. So for myself, at least, I prefer a single keyword campaign where all I have is one product and one keyword.
That could vary if you have the same type of product that you're going after the same keyword. I'm not sure the intricacies or the details of this example, I prefer a single keyword campaign where it's just one product, just one keyword.
And the reason being is because that is the maximum amount of control that you can get on a particular keyword to product pairing and gives you the control over managing and seeing the data for that keyword on that product and you can leverage the placement settings,
the bidding, everything that you do within that campaign is only influencing the relationship between one product and one keyword.
And that gives you that maximum control over managing that keyword and getting the maximum visibility that you can.
And it really just kind of distills all of the data down into a single location that you can start to And we're here to help you see and manipulate and change and make those adjustments with.
Speaker 1:
So kind of going back to, uh, you know, these ranking strategies, I think what people typically are doing is single keyword campaigns and ranking strategies I would think don't have to be single keyword campaigns, right?
You can just like increase your bids on a keyword specifically. The reason why we normally prefer single keyword campaigns is just because You're gonna have a lot of, it's a high volume keyword.
So you should have a good amount of data for all of those placements and you can control the budgets a little bit more accurately on them.
A lot of times your target A costs on these campaigns is gonna be really high because you're trying to be aggressive just because it's a competitive keyword, the CPCs are high.
So it's kind of nice to just put that into its own campaign where you can control the target A costs, control the budgets on it and control the overall investment levels. But just spending on that keyword itself Does not equate to ranking,
but what it will do is increase your product's total sales. And so kind of at the very start of this, we were talking about how important sales velocity is and BSR, best sellers rank for, you know,
showing up on rank in search and something else that I think is important to note that we forgot to mention earlier, but the BSR, the best sellers rank is not keyword specific. It is category specific.
So if you're within the ceiling fans category, the BSR is how many units you're selling relative to all the other products in that category. And so if you want to rank better on ceiling fans,
you can actually rank better there by just increasing your BSR everywhere else. Because let's, you could just, you could pause the ceiling fans keyword. This is hypothetical. I'm not saying you should do this.
You could negate ceiling fans from all of your, uh, from like all of your campaigns and not be bidding on that at all. But all the other long tail versions of it,
you could drive so many sales there that you become the number one bestseller in the ceiling fans category and then would rank very highly for the ceiling fans exact match keyword without having any keywords been behind it.
So I wouldn't recommend that. You see the ceiling fans keywords still very important and you should probably You'll need sales there to really start climbing the BSR,
but it is important to know that the BSR is more categorical level and not keyword specific. What is keyword specific is the Amazon, well, it used to be called Amazon's choice.
Now they've changed it to overall pick, but that's Amazon's, like Amazon choice, overall pick, that is keyword specific. That's saying, hey, when people type in this search term, This product seems to be the best.
It has good reviews, a good price point, low returns, high conversion rate, and you know, that seems to be a bit more keyword specific, but in terms of In terms of ranking, Andrew, what else would you say?
Have you seen a correlation where if you spend more on a keyword, because we're saying that spend is not equal to ranking, but you've probably seen if you spend more on a keyword, then you start to rank better organically for that keyword.
Have you seen that? And if so, why is that?
Speaker 2:
Yeah, so I have seen it and I've also seen the flip side of it where we try to spend a whole lot on keywords and we can't necessarily produce that additional rank.
Sometimes you'll see like a little bit of change even like if you're spending quite a bit on there because because you're increasing the total sales that you're better driving through that particular keyword.
But there's got to be something to be said for how your product converts relative to how all the other products convert on that page.
And so if you're operating at like a 5% conversion rate and the rest of the market's at like a 10-15% conversion rate, those other products are much more likely to drive sales for For that,
those other brands and Amazon and all that type of stuff.
So those products are going to rank higher and you're going to have a really hard time trying to get your product to rank whenever you don't convert nearly as good as everybody else on that search.
And I think we talked about this in the search query performance report episode where you can compare on a query by query basis your products Conversion rate versus the total market average conversion rate.
And usually when you see a mismatch there where your conversion rate is higher than the overall market average, I can pretty well confidently say that you're probably ranking on that keyword pretty well.
And if not, and you start putting spend towards that, then you should see a much more quick and rapid improvement in your overall ranking. So it's whenever there's a big mismatch between what everybody else is doing, what you're doing,
In terms of conversion, when it makes it a lot more difficult for you to actually produce the results with these ranking strategies.
Speaker 1:
Yeah, and I would venture to say that if you are not on page one organically for a search, it's all mission to keep going with the ceiling fans thing.
So if you're not appearing anywhere for ceiling fans on page one, And you're not running any ads on it. It's very unlikely that you will ever be on page one, because there's like a million ceiling fans being sold on Amazon.
And let's just say there's like 100 results total that appear on that first page. They're just gonna be showing like, and you know, maybe 40-50% of those are all ads, right?
So there's gonna be like 40-50 ads and then 40-50-60 organic placements. And those are all going to be all the organic stuff or like basically the top 50 bestsellers or whatever.
If you have a good product, but you have zero history of ever showing up in the ceiling fans search, you're never going to get in there because Amazon hasn't got a chance to test you for that search term.
And so a big part of what these ranking campaigns are is paying Amazon an opportunity to do research on you, to put you into the batch and be like, is this product For this keyword, is it on average converting better than others?
Is it working for customers? Is it working for Amazon? That's largely what it's doing. And if the answer is yes, that this product is worthy of being in there, then you're going to start showing up there organically.
If the answer is no, if the product just sucks and has a really low conversion rate,
then no amount of however much you spend on that keyword is ever going to get you to rank at the top of search organically just because it's You're not beating other folks on conversion rates,
return rates, reviews, all that kind of stuff.
Speaker 2:
I'll just add to it because I think you said that really well, but just because it Doesn't produce the result right now, doesn't mean that it won't down the line.
So like a new product comes out, we still run ranking strategies on those products. We just don't necessarily see ourselves jumping straight to number one.
Like we see some improvement and as that product lives a little longer and we go through, you know, 3, 6, 12 months of that product being active, us spending on those keywords and we get more reviews,
our conversion rates improve, we optimize the listing a little better. Then we start to see a little, you know, just steady traction on particular terms that we're going after.
So it may not happen all at once where you just start these ranking campaigns and all of a sudden you're ranking number one, especially if it's a brand new product.
That can happen, not as common, but there's still something to be said for keeping the foot on the gas on certain keywords, even in a new product launch, to build up that history,
to build up that exposure and give Amazon more and more data constantly as your product gets better and better over time and then you start to see that ranking improve.
Speaker 1:
Now, we were also saying how BSR is kind of a momentum based metric. All of Amazon is really like kind of like momentum based. But do you think, Andrew, that the keyword ranking is in some way, just pure sales momentum based?
So if you're just getting forget conversion rates, and you know, I think that's the most important thing, right, is Yeah, the three most important things are probably just your conversion rate relative to others,
your reviews and ratings relative to others, and your return rates relative to others. And then the one final thing would just be like, how much money is Amazon making? But So that's the most important thing.
But BSR seems to play into that, which is just total sales for the entire product across the entire, it doesn't matter if it's external traffic or if it's a completely unrelated search term that all contributes to your BSR.
But do you think that the keyword ranking in some way also has some kind of Let's talk about keyword sales rank in terms of like a BSR thing, but like kind of relative,
like how many units is this product moving for that search term specifically relative to others and that would include both paid and organic. So if you start increasing on the paid and you're moving more total sales than others,
that maybe that contributes to the ranking in a momentum way.
Speaker 2:
I could certainly see that. It's very correlated in nature. As you're growing overall sales volume for a product, you start to see yourself ranking better on a lot of keywords. What fuels that is the inverse of that.
You're spending more on certain keywords. That's fueling total sales growth, which is raising your overall volume for that product and bringing you up the BSR rankings. I think they're just really tightly correlated.
I don't know the specifics of that. We track BSR pretty closely, but there's definitely something to be said for that sales momentum and everything as you kind of build up velocity on certain terms,
you spend more on certain terms and kind of get that flywheel starting to buzzword flywheel. Starting to kind of churn and yeah, getting that going. But yeah, I'm not sure on those specifics.
Speaker 1:
I would say that I have, and unfortunately I don't have like any screen share here, but I have a lot of anecdotal evidence for a few different brands I've been working with where it's like,
no matter how much you spend on these ranking strategies, they're never going to, you know, be at the top organically. Just because they don't have the price point or the conversion rate,
especially like in some of these categories where we became super overwhelmed with these Chinese sellers. And this was like kind of the trend for the last like, you know,
kind of since like 2022 and 2023 when we were going into like peak inflation. These products that were selling for like 200 bucks We're just getting beat out by products that were selling for 50 bucks.
You know, people just really preferred the cheap things. And we could spend thousands of dollars a month on just one keyword per like, you know, we'd have each all these different single keyword campaigns.
It was totally like tens of thousands of dollars of ranking stuff. And after running those strategies for months, did not appear anywhere on page one of the search.
And that's just You know how it is and so keyword spend does not equal keyword ranking.
I would say the main time when it does contribute to keyword ranking is if you previously did not have any history there and your product actually just performs better organically than some of the others and like you deserve that spot.
So if you deserve that spot organically, then putting some money into these keyword ranking campaigns can help get you there. But if you don't deserve to like naturally rank organically,
then no amount of keyword spend is going to get you to rank organically there. So I think that's kind of the summary of things.
Speaker 2:
Yeah, definitely notice that when taking on new accounts, if you can find gaps to that where you're not currently targeting pretty explicitly that you should be that are, you know, higher volume, you perform well on organically.
And adding a little bit of PPC spend to those can really show some quick results. And that's, you know, generally what we're looking for there. But Stephen, there's this one other idea that's kind of floating around,
around whether or not you should have a target ACOS for your ranking campaigns. I've heard people say, you know, we don't optimize for target ACOS on ranking campaigns. We just maximize sales.
We're just trying to maximize sales at all costs. Do you have any thoughts on that that you want to share? I know we kind of touched on having a target ACoS, so I know where you stand on that, but would love to just hear your take on that.
Speaker 1:
Yeah, this is actually a good question. You can't maximize sales without a target ACoS. Like you need, I guess here's why I think that's a dumb thing, because it's like if your goal is to maximize sales,
like, okay, you could have, you know, Let's just say you're gonna spend $1,000, okay,
you're gonna spend $1,000 and you could get $1,000 of sales at a 100% ACOS or you could get only $500 of sales at a 200% ACOS with the same amount of spent, right?
Obviously, you would prefer the one with $1,000 of sales, okay, that's a lower target ACOS. So the problem of just going Like just grow sales, grow sales, grow sales,
no target ACOS is you don't really have any way to optimize bids and placements and all these things to actually grow the sales. Like all of these calculations are set around. Now you could say a high target ACOS,
but just increasing spend for increasing sake can lead to a lot of spend with no sales, like high spend, no sales conditions, or just really inefficient placements or super high ACOS like placements where,
you know, you can drive more total sales With a lower ACOS. Like you can't remove ACOS from the sales equation because it's spend in sales. So you have a budget and you want as many sales as possible with that budget. Great, that's an ACOS.
Speaker 2:
Yeah, I've noticed that a lot of people kind of tend to subscribe to that for whatever reason and just try to cap the budgets on,
like they try to budget around how much they're going to spend on this keyword and not really factoring in having an actual cost control that we're actually trying to keep.
Speaker 1:
Yeah, just to pick another extreme example. Optimize for maximum sales. That's not a goal like you people need to learn like when you're setting goals like you need a target. Okay, so you can think what would be a sale?
What would be a good metric a thousand units sold on this on this keyword? Okay. Now you have a target to move towards. So now it's like, okay, I want to get a thousand units sold.
Are you willing to spend a million dollars in one month to get that? No. Okay, so that's too high of an ACOS. You can figure out how many set a sales goal and then consider how much you're willing to invest.
And that's now your target ACOS, your budget divided by how many sales you're trying to get towards. And you can work towards that.
It's just you're gonna have a much better time actually getting sales if you're doing some kind of optimizations there. Because something else that's kind of in a similar vein is people will do these top of search only campaigns,
or it's like a low base bid, but they're only targeting top of search. And The problem with that is maybe top of search, yeah, like maybe the conversion rates are higher there.
Maybe the conversion rates are 50% higher at top of search compared to rest of search, okay, 50% higher. But the CPCs are 500% higher. Okay, so now if you have a limited budget there,
you could burn through that whole budget and only get like, you know, 20% of the total possible sales versus if you were actually trying to maximize sales, you could, you know, get sales everywhere on Amazon.
Don't restrict it to just one placement. Yes, Top of Search has the best Conversion rates usually, but it's not the only place where conversion rates are happening. So if you're just trying to move sales, you want it everywhere.
Speaker 2:
Anything else to add to this? I feel like we're kind of wrapping up here. Any final thoughts?
Speaker 1:
I think that the main concluding thought is that, you know, these single keyword campaigns that are kind of focused on your VAP keywords, trying to help ranking, they themselves do not, you know, solve, they don't earn you organic ranking.
Just like that, the best way to do ranking is to drive total sales volume, get that BSR up, make sure your conversion rates are beating benchmark, make sure you've got the reviews. That's all the stuff that actually gets you there.
And then some keyword spend, the purpose of a keyword ranking campaign is just it maintains the overall sales velocity and BSR,
that momentum based stuff, but it doesn't just It's not just a one-to-one correlation that automatically wins you keyword ranking. If you got a bad product, nothing you can do can ever get your rank in there. All right.
Speaker 2:
Very well said. Well, everybody listening, thanks so much for tuning into another episode. Make sure you subscribe to the channel.
We got a whole list of topics that we're rolling out and leave a comment if you have one in mind for us and we'll be happy to cover it.
Speaker 1:
All right. See you guys next week.
Speaker 2:
See you next time.
Unknown Speaker:
Thank you.
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