How To Manage Your PPC Budget?

How To Manage Your PPC Budget? Speaker 1: So we want to be explicitly clear on this. The purpose of budgets is not to control your budget. Speaker 2: Your ad rank is going to be better because you're telling Amazon that, Hey, I'm willing to spend more. Like feel free to show me the more it doesn't. Speaker 1: If you're trying to spend $30,000 a month, that means on average, you should be spending about a thousand dollars a day. 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 1: Welcome back everyone to another episode of That Amazon Ads Podcast, where today we are going to be talking about what your starting budgets should be on campaigns. Not even just starting budgets. What should your budgets be in general for campaigns on Amazon PPC? And as always, joined here with Andrew. Andrew, how you doing? Speaker 2: Doing very good, Stephen. Yeah, I think budgets is a good one. People get this one wrong. They have a lot of misconceptions and a lot of things that they don't really understand fully about how the budgeting really works within Amazon. I'm excited to dig into this and share. Our approach to it and how we kind of go about managing budgets for all the clients that we work with. Speaker 1: Yep, absolutely. And Andrew, before we hit the record button, we were kind of talking about how it's been pretty difficult to keep up with the pace of weekly podcast episodes, new content every single week. So potentially in the year 2025, we may be trying to reduce some of the frequency, hopefully increasing some of the quality though, putting a little more time into, you know, screen shares or decks, those types of things. So, um, we would love to get your guys feedback and comments. Just drop them below. If you would be in favor of that, you know, fewer, fewer frequency, better quality, or, uh, keep up the with the weekly pace. Um, or maybe we should just stop it entirely. Speaker 2: Yeah. Maybe it's not valuable at all. Speaker 1: Well, I mean, like we covered, it's been, you know, this can be episode like 80, you know, that's a lot of content. So you guys should have pretty much have all the, every, every topic covered. Not sure if there's anything else to talk about. The Amazon space fully covered it. Speaker 2: We'll see how it goes. We'll see what people say, man. I mean, I'm certainly feeling it. It's been a little bit tough to keep up with that frequency just as everything has grown. AdLabs getting busier, more clients, all that type of stuff. It's definitely making it a little tricky and new family members, all that type of stuff. So a lot of things to consider. Speaker 1: We'll say if this episode, this video gets 50 likes, And we'll make another one. Speaker 2: That's how we'll keep it going too. Just every episode, every episode has to get 50 likes and we're not making the next one. Speaker 1: Yeah, that's a good, I like that. All right. So let's dive into the topic of campaign budgets for Amazon PPC. Now the first and most important concept that unfortunately a lot of managers, brand owners completely miss this point. They totally miss the understanding of the purpose of budgets. So we want to be explicitly clear on this. The purpose of budgets is not to control your budget. All right, sounds kind of weird, but let's just say you have a brand where your goal is to spend $30,000 over the month, like that's your monthly budget. You are not trying to control that $30,000 monthly budget based on the campaign's budgets themselves. The primary purpose of campaign budgets is to prevent Unintentional, inefficient, spend or overspending. They are safety rails, but they are not how you actually control your actual budget. Now that's going to sound a little backwards. I'm sure Amazon, Google, these platforms will probably say that the purpose of campaigns is to determine how much you want to be spending on a product or whatever for that day, for that month. But in practice, when you have a lot of campaigns that are segmented out, it becomes really difficult to actually control the true daily budget for any given product because not every single campaign is going to spend in full every single day. And so, yeah, that's kind of the first point. And we're going to talk a bit more about these misconceptions. But Andrew, what do you think, like, you know, the reaction is going to be from people just hearing that? Speaker 2: Well, hopefully positive. Hopefully they're learning. But the way I kind of think about this is, you know, you ever driven those go-karts, like a little go-kart track before? Speaker 1: Yeah, I love them. Speaker 2: So those things, you know, those don't go quite as fast as some of the other ones that you can get because they have like the little regulator on the engine, right? Like they have that cap on there that prevents them from going too fast. And so they can only go up to a certain speed. And so I kind of think of budgets in that similar way. They're like a regulator on your spend. They kind of cap things on the spend. It's not necessarily the gas pedal. It's not what's the lever that you're pulling to actually elicit more spend. It's more so the regulator, the cap that you're putting on how much you could potentially spend within that campaign. Speaker 1: And I'm actually going to jump ahead to another point in our notes that's supposed to come later, but I think it's going to make a lot more sense here. When it comes to best practices for budgets, when you have a campaign that is running out of budget, so let's just say you put a $100 daily budget on this campaign and you're checking in in the morning or afternoon and you're seeing that campaign is Amazon saying it's out of budget and they're recommending to extend the budget. First of all, that should not be happening. So you should not ever have campaigns that are running out of budget. What that means is if these campaigns are out of budget, either the campaigns are profitable, And you should be extending the budget. So let's just say you're targeting like a 30% ACoS. You're getting a 15, 20% ACoS. This thing's running out of budget. Again, watch the episode on is ACoS a vanity metric? We're assuming for all these things that you've done a good job setting up your campaigns and everything. So this is a true ACoS. This is truly incremental sales to the business. It's having a positive impact. If that campaign is running out of budget, where every dollar you spend, you're making four or $5 in profit, you should be extending that budget. Why would you pause something that's generating money for you? So if the campaign is running out of budget and it's profitable, truly profitable, extend that budget. If the campaign is not profitable, and it's running out of budget midday, then you need to reduce the bids on that campaign. Why reduce the bids? Because that will allow you to get more total clicks throughout the day at a lower overall CPC and will allow that campaign to run for the whole day. So let's say you, you have a hundred dollar budget, And it's running out of budget every single morning at a $1 CPC. So what's happening is you're getting a hundred clicks in the morning at a high CPC, a high ACOS and then the campaign gets paused. If you cut those bids in half, this is all not the actual math you guys should be doing, but you know, Just for the example, if you cut those bids in half, you are now going to get 200 clicks on that campaign at a 50 cent CPC and that campaign is going to run through the whole day and not run out of budget. So conceptually, the idea there is you can lower the ACOS, you can drive more total traffic and you can keep your campaign on through the whole day. So the question there is basically, if you got this campaign running out of budget in the middle of the day, what would you rather have? Would you rather have less traffic that you're losing money on and the campaigns don't run the whole entire day, you're getting less visibility, less impressions, or would you rather be more profitable, more traffic, more sales and keep the campaign budgets rolling for the whole day? Those are basically the two options, right? So hopefully that makes sense. These campaigns shouldn't be running out of budget. There are sometimes some exceptions where you may want these campaigns to run out of budget intentionally. We're not going to talk about that just yet. We might jump into that a little bit later. But yeah, Andrew, that concept of Reducing bids to control the budget. How do you actually, let me back up, when you're actually jumping in your accounts and you're seeing campaigns running out of budget or maybe not using the full budget, how do you normally respond to that? Speaker 2: So first things first, like just having insight into this metric on your campaigns is important. So going into the console using the budgets tab is really the first place I'm going to kind of check and see Which campaigns are running out of budget? Which ones are not? That's where you're going to get that average time and budget metric for each of your campaigns. And you're going to be able to see which ones are even in budget all the time or which ones are running out early. And then you can use the, you know, the performance of those campaigns to dictate like you were saying, whether if they're profitable, we can extend them. If they're not profitable, then I have a different workflow where I'm going to be digging into what's going on with the keyword bids, what's going on with the placements, how can we manipulate those to help extend the amount of time that those are running and not just like blowing through the budget that we do have available for this campaign, rather trying to more efficiently distribute it to the right places in the right timeframe throughout the day. So that makes total sense to me. This is really one of those key areas that we look for in audits. Whenever we're taking on a new client, spending some time in the budgets tab usually gives us an idea of just some additional opportunity that could be on the table for certain campaigns in those scenarios where they're running out of budget and they are profitable. Just a lot of times we see that and all you really need to do is just keep extending those because they're performing well so long as there's nothing under the surface there that you need to clean up. But yeah, I fully align with that and that's generally where I'm going to try to figure out which campaigns really need to be adjusted. Speaker 1: Yeah. So I cannot emphasize this enough, but the best way to control your spend pacing for an account is to adjust bids, not budgets. And what we mean by that is, Again, I'm gonna stick with this example of $30,000 budget and 30% A cost, because that's a pretty average one for Amazon accounts. So if you're trying to spend $30,000 a month, that means on average, you should be spending about $1,000 a day. You're obviously not gonna hit $1,000 every single day equally. You're gonna have some days that are a little less, some days that are a little more. We use AdLabs obviously to optimize everything and we actually have a spend pacing metric in there. So you can enter what that monthly budget is for all your accounts. And then that cell in the table will highlight green or red depending on how close you are to hitting that spend goal. So if you are overpacing or underpacing that spend goal, you're not going to control that by increasing or decreasing budgets. You're going to control that by increasing or decreasing the bids. The primary reason for that is because if you're overspending the goal and you're getting it up to like $1,500, $2,000 of average daily spend, you're way overshooting that $30,000 monthly goal. Well, then that same kind of concept applies that we mentioned earlier where either You're overpacing but the ACOS is super low. You're getting like a 20% ACOS relative to the 30% in which case you're gonna have to reduce that spend pacing regardless. Okay, sorry, not regardless. You're either going to have to reduce the bids to slow down that spend and that will actually lower your ACOS even more. So if you are at 20% ACOS, you're overpacing the spend goal for the month, you're gonna go to the client or you are the client or you are the brand And you are going to try to get approval to spend more. So you're going to go to the client. You're going to say, Hey, things are really firing. Conversion rates are strong. Traffic is strong. We need more budget to support this. You can show the metrics, show the profitability. Client says, cool, let's do it. Let's increase the budgets for the month from 30,000 to 40,000 or 45,000. Great, now you can keep your campaigns on. If the ACoS is not good, if you're getting over 30% ACoS, you're gonna reduce the bids, that's gonna lower the ACoS, that's gonna allow you to get more total traffic within that budget and more total sales. And if the client says, we don't have approval, so I know that you're at a 20% ACoS, you don't have the approval to extend the budget. Andrew and I have had this before with another large brand we were working with. And so we just lowered the bids still. If they're happy at a 20% ACOS, they're gonna be even happier at a 15% ACOS. So you might as well, the whole idea there is you can drive more total clicks and drive more total sales, get a better overall ROAS, a total ROAS, more total incremental sales to the business. And today we're going to be talking about how you can get more clicks by allowing yourself to get more clicks. It's basically the worst case scenario to just have campaigns shutting off in the morning because you hit the spend budget cap. Speaker 2: And in your example, you know, if you go back to the client and you're asking for additional budget and your performance is really good and they're not willing to give it to you, we're not saying that's like the best business decision that you should make with, with how you're budgeting. Like in those types of scenarios, I would put more money into it to continue to feed it. A lot of the clients that we work with in the past usually, at least for me, haven't always had fixed dollar budgets. Like there's been some bigger brands I've worked with that do have kind of monthly budgets they got to stick to, but a lot of times clients are kind of basing their budgets on the returns that the ad spend is actually generating. And so most people will kind of say, hey, if we can hit this target A cost, We have freedom to spend within that and scale campaigns at that target margin. In that way, it frees up the flexibility of being able to push and pull whenever you need to. In your example, if you're at 20% ACoS, you could just continue to pump more budget into those because it's driving sales, it's efficient and growing the business overall. There's a couple of different distinctions. If you have a fixed budget versus an ACoS budget that you're working within, it's going to change the dynamic of how you're having to Adjust things and manipulate things throughout the month. Speaker 1: And in the masterclass, we have a lesson on the quadrant method of account management. And if you wanna learn more about the masterclass, you can click below. The graphic is basically, it's a quadrant, so there's four boxes. And the top section is titled, if you're above or below the target ACOS, so like ACOS pacing relative to the goal. And then this other side is the spend pacing goal. You could also use the sales pacing goal. And so if you're overpacing your spend and you're over the target ACOS, you're gonna make certain actions. If you're overpacing the goal and you're below the target ACOS, you're gonna make different actions. And then same with like if you're underpacing, overpacing, underpacing, underpacing on both. So there's basically four different scenarios that you could be in. And in that quadrant, Managing the budgets or changing the budgets isn't part of it. You're going to be controlling the spend and controlling the ACOS by switching up your keywords and switching up the bids on those keywords. That's going to be the most effective way. So that's just something that I think is really important for people to realize is that campaigns running out of budget is a bad thing. That's something that we always uncover in our audits. Like Andrew kind of mentioned earlier, there is the budgeting tab in Amazon, which is a massively helpful tool where you can look at normally when you're in the campaign manager, it's only showing you the campaigns that are out of budget currently, but not necessarily historically. To see which campaigns were running out of budget historically, what we used to have to do is download a daily spend report and compare that to the campaign budgets and see if the daily spend was hitting the budgets to calculate it. But then Amazon just put that into the budget tab so you can see on average how long are these campaigns staying in budget. If you see campaigns are On average, only in budget 50% of the time and the ACoS is low, then you should be extending those budgets. And if the ACoS is high, again, reduce those bids and that will pull the ACoS down and yeah, just allow those campaigns to stay on and drive more total sales. Now, Andrew, something new has come up in the ad console where Amazon actually allows you to decide whether you want to set your budgets at the account level, which basically governs all of your sponsored product campaigns combined. Or at the campaign level. So what that means is if you have that $1,000 average daily budget that you're trying to use, you can either apply, uh, you can either keep all the campaigns and, and when an individual campaign runs out of budget, it'll stop, or you can assign the budget to the entire account. So if you spend a thousand dollars in a total day, it will pause all of the campaigns. What are your thoughts on those two options, those settings and what would you recommend? Speaker 2: Yeah, so I think it really kind of depends. You know, there are times that I have used that account level campaign cap just in like, just for preventative measures. And I actually encourage people to have a account level campaign cap in place. Maybe it's not right at what you're currently spending, but just give yourself a little buffer just to prevent any sort of scenario where You might have a big flux of traffic and spend spikes for some reason. Something goes wrong, your automation fails, spikes all your bids, and you just blow through thousands of dollars. It would be important to have that account budget setting, daily budget setting in place just to prevent that from happening. I haven't seen that happen in my personal experience, but I have heard some bad stories about stuff like that and having that in place could really help. In general though, like I am usually as I'm going through the month, if I'm pacing towards a specific account level, like monthly goal, I'm kind of looking at the daily pacing and then I'm adjusting my bids based on whether or not I'm below the average daily pacing that I need to be at or whether I'm above, I can kind of make adjustments based on that through the bidding that I'm doing. And I find that that's a little bit better way to do things. And yeah, usually you can find More efficient ways to spend budget within a capped amount if you're optimizing bids rather than just putting that cap in place like you were talking about on campaigns like just putting that cap in place. We should more so be looking at adjusting the bids and trying to improve the efficiency within that daily spend. So yeah, that's kind of how I look at it. What about you? Speaker 1: Yeah, one thing that's really beneficial about the account level budget setting comes from one of the cons of the campaign setting. So if you were to set it, let's say you have 100 campaigns and your goal is to spend $1,000 a day. If you put a $10 budget on all of those 100 campaigns, totaling up to $1,000 of potential daily spend, you're unlikely to actually spend $1,000 a day because it's extremely unlikely that all 100 campaigns are going to use the full $10 budget. And so what you need to do is some campaigns, cause cause every campaign is gonna have different keywords, right? And different keywords have different traffic, which is going to create different amounts of spend. So realistically, you're going to have some campaigns that can spend, you know, $20, $50 and other campaigns that don't spend or only get like a few dollars of spend. So to make sure that you can actually spend the full $1,000, you're going to need to set a budget of, let's say $20 or $25 across all of your campaigns. And then if every single campaign spent in full, then you would have spent $2,000 or $2,500 depending on whatever that budget was. So that's a little bit of a weird thing where totaling up all of the campaign budgets Um, it is, is a bad way to estimate what your daily budget is because not every single campaign is going to spend in full. And we, uh, we, we, once I'm not that same account we were working on, we were looking at, you know, the average spend goal I think was like $10,000 a day, but we had like 10,000 campaigns and we were using a software tool that was Very stupid, extremely stupid. And it decided, should we say what the tool was? It begins with a K and rhymes with Achoo. Speaker 2: Used to be cool. Speaker 1: Yeah, Ken. Oh, sorry. Yeah. It rhymes with Sky. So this tool, trying to control our daily budget of $10,000 a day, set a $1 budget for 10,000 campaigns to make sure we didn't overspend the $10,000 a day goal. Which obviously basically just paused all of our campaigns in the middle of the day. So we're like in the middle of the night really like it was like midnight struck and by 5am like, you know, 25% of the campaigns were out of budget. And then just stopped delivering those were like some of the best performing campaigns that just got wrecked. So yeah, that's going to be a big mistake. So if you are trying to do that, that is a nice control at the account level setting. The downside of using the account level setting is then you can't control the budgets independently for different tactics or different products. So if you do have a big catalog where It's like, Hey, we want to put a thousand dollars into this product, $2,000 to that product. We want to invest a $5,000 budget into ranking all those things. You lose that control at the account level. So there was a little bit of a trade off there. I would say, um, in general, I'm working with one brand right now, very tiny brand that only has one product. And so in that case, it makes sense to just do it at the account level. Cause we got like, you know, a really small budget and we've got like 10 or 20 campaigns. And it's just easier control at the account level rather than trying to manage, you know, 20 different individual campaigns. Speaker 2: And then there's another layer to it too that we haven't talked about yet, which is portfolio level budgets. And so catalogs that are much larger and extend across multiple categories, you may have to take a monthly budget and divide that across If you have a large catalog, you can set your product line and maybe have some certain targets that you can't exceed. If you take all the campaigns related to whatever category, assign them to a portfolio, it allows you to set a budget limit on those as well. You can set certain date ranges. If it's for a particular period that you want to have a limitation for a budget for, you can do that. There's a couple other different avenues of dividing the budget and managing it. Stephen said smaller catalog, you can do at the account level setting. If you have a bigger catalog, a lot of categories, you can do it at the portfolio level to kind of divide things up that way if you need to. But yeah, one other thing on that note, when it comes to larger product catalogs and just budget management in general, one thing that I always look for, and we do this in audits as well, is how is that budget being distributed across the product line for a given brand? So oftentimes what we'll find is that A brand will put a majority or an. An unweighted majority of ad spend behind a single product or a collection of products and neglect a large selection of their catalog. And a lot of times we can immediately see some really great growth by supporting and fully supporting those products that aren't getting the love and attention. A lot of times it's just due to the structure, how things are set up. It's kind of the ads are just favoring the highest, highest volume products, the highest converting products and everything else is just kind of being ignored and neglected. We're just working with the brand over the last few months that came to us and needed some help. And one of the first things we saw, there was like four or five products that were just like barely being spent on. They had ridiculously high margins on them. And there was just a ton of opportunity there for them to grow that product. It was ranked like 50th in the category and over the last few months, we've kind of built it up and they had some all time highs over the last couple of months and they're still profitable on that product. It's just grown the scale because we decided to invest in it. And so what you want to look for and how you can go about doing this is pull a total sales report by child ASIN or yeah, by child ASIN and then pull a Advertise product report, sponsor products, and then you can do display too if they're running a lot of display and add them up. But in general, sponsor products is good enough. And just pull that in together and just see how that spend as a percentage of the total spend is spent on each individual ASIN. And if you notice that there's an ASIN that says that, say, let's generate like 30% of your total sales, and it's only getting like 15% of your spend, or maybe it's getting like 80% of your spend. You know that there's something wrong there. The relationship between how much you're investing in a product and how much that product is actually contributing to your business, there's a mismatch. And sometimes that's okay. Sometimes that makes sense. If it's a new product and you're trying to push it and get it to grow, then that makes sense. Maybe there's a misweighting between how much that is contributing versus how much you're spending on it. But if for more seasoned products, you kind of want to match that up to where you're investing in the products that are most contributing to your business. But not too much, you know, just to the right degree. And usually I'm looking for like a close to a one to one correlation. It's not always the same, but just like if it's contributing 30% of my sales, I'm investing roughly 30% of my ad budget into that particular product. And then going through the rest and seeing is there is there opportunity for reallocating the distribution of that budget across the products? Speaker 1: Yeah. So, you know, three, three ways to control the budgets, portfolios, account campaigns, the same principle applies to all. If any of those things is running out of budget and the things and everything's profitable, extend those budgets. If it's not profitable, reduce it or reduce the bids, I should say. And The reason for that is because running on a budget while you're losing money is the worst of both worlds. What's better is to either just not be hitting the budgets at all and be profitable or to be extending those budgets just making more money overall. So either of the other two solutions are better and the worst option is just awful all around. One other kind of thought experiment I want to offer you guys is let's just say for the sake of proving the point of how important these bids can be, let's just pretend there are no budgets. Campaigns will spend infinitely and there's no way to stop the budgets, right? In that environment, You would always, if you could only control the bids, that's exactly how you would be controlling your budget pacing. So if you're over, under, if the ACOS is over, under, that's gonna control how you're increasing or decreasing those bids. And you can also be a lot more strategic with which keywords you're increasing the bids on, like which keywords have more traffic, which keywords have lower ACOS or higher conversion rates. You just have a lot more control, can drive a lot more total performance. So you should be thinking of it that way. Now, where budgets come in and why we do use budgets is because the ability to spend an infinite amount is scary. If there's a campaign that spends 10 times your entire monthly budget on a single day at a 200% A cost, obviously that would be terrifyingly bad. So that is the primary purpose of budgets is just to prevent worst case scenarios and prevent mistakes basically to prevent unintentional overspend or wasted spend. That's all it's there for. Those budgets are just to kind of control, guard against that, some safety rails, but they shouldn't actually be something that you're hitting on a regular basis because that would just be bad for performance. Something else that's important to know is that increasing budgets does not increase spend. If you have an account, if you have a campaign that's on average spending $100 a day, And the budget for that campaign is $500. And if you increase that budget to $1,000, the campaign's just gonna keep spending $100 a day. So that's, I've seen this mistake so many times where people were like, Hey, we need to like increase our spend. And as people go through and they just increase all the budgets on the campaigns, the campaigns already weren't hitting the budgets. So there's no impact to the spend. And then they just keep increasing the budgets more and more and more like, man, I just can't get this to spend. It's because budgets are not how you control spend. So yeah, everything's going to be at the bid level. And then in a similar concept, I had a client, That was, um, you know, trying to dive into the weeds and, uh, be the brand hero jumping in, trying to tell me how to do my job, uh, managing his account. And, you know, we had a, we had a, uh, a multi keyword campaign that had like, you know, uh, probably like 10 or 20 keywords in it. And then we had a, another, uh, brand defense campaign that only had like one or two of his, of his brand keywords. And he saw that they both had like a $100 budget. And he saw that the brand defense was doing better. And he says, why don't we increase the budget? Like, why do they have the same budgets if the other one's doing better? And I was like, well, first of all, the brand defense isn't even hitting the budget gap. So increase that budget is gonna do nothing. And then secondly, the other campaign has a lot more keywords. So naturally, it's gonna be spending more. So trying to evaluate campaigns and saying, I'm gonna put more budget on this one campaign that has a better ROAS. Isn't gonna actually make a difference because a big part of what controls how much campaign spend is how many keywords are in that campaign. What's the traffic for the keywords in that campaign? And what are the CPCs for the keywords in that campaign? All of that's gonna control how much a campaign can spend. So if you have like a single keyword campaign or a campaign with low volume keywords, It doesn't matter how much you increase the budget, you're not gonna be able to spend any more on it. Speaker 2: And you also have Amazon conspiracy theorists that think that by setting a budget that's higher, Amazon's gonna give you more visibility or more impressions. Speaker 1: You're gonna rank better, yeah. Speaker 2: Yeah, your ad rank is gonna be better because you're telling Amazon that, hey, I'm willing to spend more, like feel free to show me more. It doesn't, this is not how it works. Speaker 1: Yeah, exactly. Speaker 2: People think it is. Speaker 1: Campaign spending a hundred dollars a day, budget's a thousand dollars a day. And you're like, if I put my budget to 10,000, Amazon's gonna be like, oh, these people have deep pockets. Let's, let's give them a bestsellers badge just because, you know, they, they, uh, made a foolish mistake with their campaigns. It does not work like that. So. Pulling this thing into a conclusion, we got one final topic, which is starting budgets. So you've got a brand new campaign. What should those starting budgets be? Andrew, don't say depends, just give me a dollar amount. What should it be? Speaker 2: I'll give you what I would do. I won't say it. Speaker 1: Don't say it. Speaker 2: I won't say it. I won't say it. Whenever I'm launching campaigns, I'm doing that campaign stack most of the time for individual products. And so I will assign budgets to based on the objective that I want to achieve. And so a lot of times what that looks like is On my manual exact match targeting campaigns, I budget those a little bit more than my auto campaigns, for example. Like I put a $10 budget or a $30 budget on my auto campaign and like a $50 or $100 budget on my manual targeting campaign, just because I am more willing to put the money there than I am in the auto campaign at this initial launch. I want to kind of funnel that if there is additional opportunity to spend, I want it to go through that campaign. And so I'll And we're going to be talking about how to set up a budget based on objective or tactic that I'm trying to go after and just kind of set the budgets up initially in that way where the budgets are kind of favoring the tactics and products and strategies that I want. Speaker 1: Yeah, what you could do is you could filter out for the total active campaigns with at least $1 of spend. Just to see like, okay, of all the campaigns that did spend in the last 30 days, you know, you look at the last 30 day spend, divide that by the total number of active campaigns with at least $1 of spend. And you can get an idea of like, on average, what's the average campaign spending, let's just say it's $10. Then you can start these campaigns with a $10 budget. Usually for new campaign launches, I'm going to, I'm going to err on the side of being a little bit lower with my budget, mainly because of that protective preventative measure. That's, that's the main purpose. We don't know how these campaigns are going to perform just yet. You know, we, we did our best math with getting the starting bids, right? We've got a whole episode on what should my starting bids be. So similar concept, you know, you're going to use some estimates, you're going to put it in there. But yeah, these campaigns are brand new. So I'd rather err on the side of these campaigns running out of budget in the middle of the day, just so that I can check in on it and then make that decision of do I need to reduce these bids or increase these budgets because they're profitable. You can do that. Something else would just be like, I was launching a sponsored brand campaign for another brand. And I just knew that on average, like we typically budgeted like 200, $300 for a campaign on average. So I just did like a $100 budget, which I was also just thinking like if we spend $30,000 a month, If this thing hit the full budget every single day for 30 days, which it likely wouldn't, but if it did, that would be $3,000 of total spend in a month, which would be about 10% of the spend. That seems reasonable for a sponsored brand video ad that we're trying to be aggressive on with our bids. You know, you can just use a little bit of intuition, a little bit of napkin math, and just come to a good level that just makes sense. So we can't tell you guys what that budget should be. It will depend based on a lot of The accounts performance, right? And I count that generally, you know, you only have a thousand dollar budget a month. If you're making a new campaign, then yeah, you probably only want a five, $10 budget versus if this is an account that spends hundreds of thousands of dollars a month, massive catalog, massive products. This is an aggressive product launch. You're going to be able to start with a larger budget. One other thing on this topic is when determining when, when people ask me, like, what should my starting budget be? Part of the things on that depends on is like we said, what's your typical monthly budget? If you're just making a new campaign within like an existing catalog, how much are you typically spending? The second thing is, is this a new campaign for an existing product? Or is this a new product entirely? Because that's gonna, you know, if it's an existing product that already gets a decent amount of traffic, launching a new campaign, because you're trying a new tactic or new campaign type, whatever, you're gonna want a larger budget because it's likely that this product can get visibility pretty well due to the ranking. If it's a completely brand new product, you'll probably want to do a little bit of a lower budget because number one, conversion rates probably won't be there yet. A cost will probably be a little bit higher. So you want to control that cost cap a little bit just to prevent any costly mistakes. And then the final thing is if the whole entire account is completely brand new and you've never launched a campaign before, in that case, I mean, just $10, I don't know, just whatever you feel comfortable spending, right? Because the first few weeks is just going to be trying to collect some data. So you're probably going to run at a loss, just pick a dollar amount that you feel okay with paying just to get that data. You can do a few estimates around like, if you know You know what the average CPCs are for your keywords. You can say, okay, if this is a $1 CPC, if I'm trying to get 10 or 20 clicks a day, then I should have at least a 10 to $20 budget for this campaign to make sure I get those clicks on this keyword at that CPC. So a few ways to think through it. Speaker 2: All right, well, thanks so much for tuning in to another episode of That Amazon Ads Podcast. Like we mentioned, we may or may not be back here next week. It's all up to you. Leave those likes, make sure you subscribe and we'll see you next week. Speaker 1: Peace out.