The One Activity That Will Fix Your ACOS in 2025

The One Activity That Will Fix Your ACOS in 2025 Speaker 1: What's going on, Badger Nation? Welcome to The PPC Den podcast. I'm sitting out here, sitting alongside the Pertinels River here in Texas, United States of America. I'm watching this river flow like watching the sales and clicks flowing into my Amazon PPC campaigns. And it got me thinking, as I look at this clean orange sunset, Summer creeping around in this late April evening, reflecting on a lot of the conversations I've had with people every single month. I probably talk to 80 different Amazon sellers and marketers on calls each month. I spend a lot of time in Google Meet. If you're listening to this and you're lucky enough to be one of those people I talk to on Google Meet, I just want to say thank you. I hope it was helpful. So, friends, I want to reflect on what I found most impactful in 2025. Let's settle in and reflect. My friends, there is one activity that I have found to be the most useful in 2025. And I'll tell you what, If you know me, you know that I like to roll up my sleeves, get my hands dirty, and get to work. It's perhaps my favorite thing to do in all of Amazon PPC. Shifting spend from non-converting to converting spend. Here's how I see it. If you look at your PPC account and you have an ACOS that is too high, I promise you, it is the numerator doing the damage, not the denominator. Y'all know what The numerator and denominator are, right? Meaning it is the ad cost, not the sales, that is contributing to that big ACOS that you got. It's got to do with your spend, not your sales. Specifically, your spend without sales. Here's how I've been framing it up and getting results. If you open up your account and you see an ACOS that's too high, maybe it's 70%, 80%, I promise you, it's not because of the keyword that has sales, that has a 70% or 80% ACOS that's really hurting you. It is more than likely the non-converting spend. So if somebody does have a high ACOS in their account that they do not like, they often go into the biggest spending campaigns and look at the biggest spending keywords. And typically those things do have a high ACOS, 60, 70, 80, 90%. And then they take action on those things, you know, they optimize the bids, they clean up the search terms around that keyword, all good actions that they should do However, the bigger thing that can sometimes get forgotten is that lurking, creeping, crawling thing that's inflating their overall ad spend and not contributing to sales, which is, of course, what I like to call non-converting spend. The things you would not see unless you download a search to report, sponsor brand, sponsor product, and look at the non-converting spend, where spend greater than zero, Orders equal zero, then non-converters. This is the thing that is the holy grail of PPC optimization. What is an activity where I can turn from zero to one, meaning take spend that has no sales and shift it towards spend that does have sales? For example, we talked about keywords with an 80% ACOS. There's search terms that have no ACOS because they don't have any sales. I'd much rather be sending that money, thousand bucks on things with no sales, towards that 50, 60, 70, 80% keyword. Let's look at this. Let's take an account that spends $10,000 a month, simple numbers. And let's say you've got 60% non-converting spend. That's $6,000 in non-converting spend. And I will say that I've looked at a lot of accounts, you know, those 80 people that I speak with. On the higher end, I see 60-70% non-converting spend. On the lower end, I see about 30%. Maybe sometimes 25% non-converting spend. So nobody has zero. Nobody has single digit typically. No one really being ambitious has a single digit non-converting spend. So that's just part of PPC advertising, right? You will never have 100% conversion rate. So let's take this account, 10,000 a month. They've got 60% non-converting. Now imagine that $10,000 a month account generates 30 grand a month. So 10,000 spend, 30,000 revenue. That's not bad, right? That's a 33% ACOS. Now what if I told you the fastest way to get this to 30%, so how do we bring it from 33% to 30% ACOS overall, is not necessarily to go out and look for new keywords or launch a whole bunch of new campaigns and so on and so forth, but instead look inward at the campaign. And let's say you're able to find a pocket. of $1,000 and shifted towards a keyword with an above average ACOS, right? A keyword that maybe you're not crazy about, but it's got 50% ACOS. So it does get sales, but it's higher than your average. It's 50% sales. Imagine if you were able to shift that spend. So you get rid of a big chunk of your non-converting spend, put it on something, even with a bad ACOS of 50%. So what would that do for your account? You're going to be spending the same $10,000 a month, except you've added $1,000 to spend at 50%. So that's an extra $2,000 in revenue that you didn't have previously. So what does that math end up doing? That ends up being you spent the same $10,000 except instead of $30,000 in sales, you've now got $32,000 in sales. You have $30,000 in sales compared to $32,000 in sales. A 10% gain would have been $3,000 in sales. So that's almost a two-thirds of the way to a 10% gain in revenue. And you've reduced your ACOS from 33% to 31%. There is no greater joy than when you are able to find, isolate, and achieve this. You've decreased your ACOS and you've increased sales. Reducing non-converting spend and shifting it to spend that does convert is one of my favorite things to do for this very reason. It's even more exaggerated at higher ACOSs. So if you do have a 50% ACOS and you are able to do something like this where you shift your non-converting spend to converting spend, that's the joy of PPC optimization. That is beauty, my friends. There's a couple things I like to do to address this very thing and to sort of start shifting the ad spend. Number one, go into your account and just start tracking your non-converting spend percentage. So you should know what your figure is. Like I said, closer to 30% is some of the best accounts I see. 60, 70% is some of the ones I need the most work. Try to get it to 50% as your first milestone, friends, and then reduce it over time. First thing you do, of course, is download a sponsored product search term report and a sponsored brand search term report and evaluate what you see there. Here's a fun little trick. Download it and look at it for seven days, then switch it up to 14 days, and then switch it up to 28 days. The reason why is you actually want a good, this tells you a lot about your campaigns. Let's say you have $1,000 non-converting over seven days. What do you expect when you go over 14 days? There's something interesting that this can tell you. If it does not double when you double the timeframe, that actually means you have longer windows in which your search terms convert or they don't. That is very important to know. For example, let's say you have $1,000, but then when you go out over seven days and then you're over 14 days, you have only $1,500. That means that 50% of that non-converting spend ended up converting in a 14-day window but did not in a seven-day window. This is why I love search terms and keywords that get at least one order per week, because I like that sort of control and variability. Now, most oftentimes you're going to want to look at a longer time frame, of course, which will combine that data over time for you. So a search term report over 30 days versus 60 days versus 120 days longer will give you more information because you will find something that Skips by at five clicks a month over six months, you'll be able to capture it with a long look back window. So absolutely important to do that. And at the same time, you can learn a lot by switching from a short window to a longer, to a longer, to a longer. Just a little intermediate tip there. What's really cool from here is when you download that search term report, I love to number one, just sort it by high spending non-converters, right? Orders equals zero, sort by high spend. See anything egregious. You might have some search terms that are like 20, 40, 50, 60 bucks without a sale. Easy to take action. From there, I like to then think of my data in terms of buckets. Get creative with this. Here's some really simple buckets to do and a filter on that. Match type equals broad match. See what your broad match keywords are doing. See if you can find some non-converting spend in your broad match. See if you can find it for phrase match. See if you can find it for auto-targeting campaigns, close match, loose match supplements, all of those things. See if you can go in and view it in buckets. That way it's a little bit more easy to manage. It makes your life a little bit easier. Now, the next thing to do is you need to look at a duplicated search term report, meaning if there's a search term lurking and you get one click here in ad group A and one click there in ad group B and across 10 different ad groups, you all get one click each, that's going to show up as 10 separate line items on a search term report because those are technically 10 separate search terms. So what you want to do is you want to duplicate these things. You want one row for that search term and then you want to see the combined impact of that search term. It is possible that if it gets 10 clicks and 10 different ad groups, not one of them converts. That's easier to take action. You have more confidence to take action there as opposed to if it's all spread out, you might be missing it. So that's definitely something to pay attention to. The next thing you do is, of course, my favorite, Ngram Analysis. You go in there and you run your Ngram Analysis to help you find these words that have very few clicks and you're going to take action on the root words of these things. In case you don't know what this means, essentially what this looks like is, let's say I have trail running shoes and then I have fitness equipment on the trail. Both of these have few clicks, but Let's say I take the word trail that is common in both of these, and then I look at every single search term with the word trail in it, and then I get a good approximation of everywhere where the word trail shows up. It showed up in 50 different search terms. Everywhere it showed up, it never converted. Ah, now I can make a decision about the word trail, take action, and actually save myself a whole bunch of these onesies, twosies search terms. That's really powerful. And that, my friends, is what I like to call some good search term management. So if I sit out here at this river looking out at this beautiful sunset, which is just about gone now, I'll be dreaming of you out there in Amazon land, digging through your search terms, trying to make them a little bit better for tomorrow. Turn in some of that non-converting spend into converting spend. Well, that's it for me, friends. I'm about to turn in. Until next time, I'll see you next week here on the PBCN podcast. Unknown Speaker: I've launched campaigns and picked keywords. I've got my bids, set placements too. Now bad mistakes, I've made a few. I've had my share of rankings. Speaker 1: The PPC Den. Unknown Speaker: I'm creeping, shooting my frail We are the PPCs and we're talking about Amazon. No time for radicals, cause we'll fix the gambit of the world.