What AI Gets Wrong About Your Catalog

What AI Gets Wrong About Your Catalog Speaker 2: Welcome back to Better Advertising with BTR Media. I have a return guest on today, a BTR special. We have Nick Amos on. Nick, thank you so much for joining the podcast. Speaker 1: Yes. Thank you, Destaney. Good morning. Speaker 2: Good morning. Yes. Nick, let's just kick off with a little bit of an intro. I know people know who you are, but let's talk about your experience over the last few years and maybe some of the brands that you work with. Speaker 1: Yeah, sure. Yeah, so now at this point, I mean, just hit three-year anniversary at BTR Media, which is exciting. Back in July, started off as an apprentice, you know, kind of learning the ropes, everything, had no idea what Amazon or PPC was at all. I was not an Amazon shopper. In my past time, but gradually learned the ropes, had the, you know, obviously fortunate ability to be able to work under some great mentors that we have here within Better Media. Continued working my way up, started getting a little bit more confidence underneath me, speaking to clients, speaking to strategy, executing strategy. And then over the past few years, you know, ultimately now here and now officially an account director at Better Media. Speaker 2: Well, congratulations. You have had such an incredible ramp up. And the part that I love about that is you've gotten exposure to some really fantastic retail heavy clients. I think you've learned to speak the language really well. And also just when it comes to all of our core values, you know, we always say we don't want to be the biggest, we want to be the best. We really want to lead strategy. We don't just want to be yes men who are pushing a button, optimizing bids and budgets. I think the space is in an interesting position where you have some people leaning all in on automation. Some people are leaning in on the strategist side and I think that's the sweet spot that we've really landed ourselves in is a lot of our clients need custom work. They have custom problems that need custom solutions and you really need what we call just strategy leadership to own that. And I think you lead a lot of that. You have some of our most Interesting curated brands. You want to talk a little bit about what that looks like? Speaker 1: Yeah, sure. I definitely agree. I mean, relative to, I mean, Not even like from a revenue standpoint and things like that, but from a categorical lens, I've had the opportunity of working across, I mean, I don't even know what I've, what I'm missing at this point from, I mean, broader lawn and garden to specific niches within that category, within health and supplements to the makeup and cosmetics categories, as well as the baby health and safety categories and what have you from a, Business to consumer. I've also had a good amount of experience on the B2B side of specific categories, which has been even more interesting and exciting as well with additional rollouts that have happened specifically on the Amazon side for that. But the diversification of, first of all, I mean, just the categories and then retail media networks as well has been super, super awesome. And it's just super interesting to see under the hood of each of these individual categories and see how different Different categories react and it's, I mean, of course, you know, if it's a lower ASP category, you can see how strong conversion rate is relative to the category. And then some conversion rates, if you have a conversion rate of 5%, you're the king in that category. And it's like, wow. So being able to see how different categories perform and benchmark across each other is always awesome. Speaker 2: I love that. I think that's a little bit of a unique approach we take at BTR. Some agencies like to push for category specialty. We've always pushed for diversification. I think it drives a much more rounded view for all of our strategists who really understand, you know, what are some of the discrepancies in each category? How can something like ASP have such a ripple effect on things like ROAS? And really getting that well-rounded picture, I think, then actually makes you a better category specialist. Because then you can start maybe honing in on a few of the different categories where you see a lot of correlation and be better at that, but you have to start with a multitude because there's so many different problems that each brand has, which is kind of how we got into this conversation. Nick, you're solving some very custom problems for your brands. Can you talk a little bit about what you're seeing and what the landscape looks like right now? Speaker 1: Yeah, 100%. Obviously, you know, AI has become a powerhouse relative to Taking deeper looks under the hood, trying to analyze businesses, especially in a time like right now where maybe we're in a, quote unquote, outside of B2B or back to school, of course. We're in that kind of, you know, that slump period, that ramp up into Q4. Everyone's trying to ultimately figure out, OK, over these next few months, how are we going to prepare ourselves to put our foot best forward for Q4 and then, of course, into the new year of 2027 as well. But again, I mean, every category is a little bit different, but some specific, you know, kind of niche down examples is ultimately trying to get a deeper look under the hood and use AI as a partner to help guide, you know, decisions ultimately. But, you know, from a face value, some specific things, SQP reporting, you know, trying to understand where you're at right now versus maybe the same time last year. How are things changing from a quarter of a quarter perspective, trying to get as clear of a picture of what everyone ultimately wants, market share data, which is not a super native thing that you can just pull right out of Amazon. So you have to, you know, pull some strings slash, you know, kind of, Do some specific things to try to work around that, but get an idea of where you're at now and what gaps are you missing and to ultimately, you know, ensure that over these next few months, you're allocating dollars into the right areas. Outside of that, I mean, there's specific things you can look at relative to new to brand rates and LTV. And again, helping that or using that data to help guide where your ad dollars are going to go over the next few months here. Speaker 2: I love that. I think that when you really start to scale on Amazon, especially for a lot of the disruptor brands that we manage, the overall picture becomes much more focused on what's incremental. How are we doing relative to the category? How do we distribute our budget across our catalog? And some brands don't overcome that hurdle. Some brands are still in your kind of old school mindset of what is my ACOS? What is my tacos? Those are the brands that we typically see falling behind quite a bit because the next step is really how am I doing relative to everyone else? The digital shelf is not unlimited. The digital shelf is really almost the exact same size as a retail shelf if you're considering where the majority of the traffic goes, which is page one. And that becomes really important because the number one factor to organic rank is typically sales volume followed by conversion rate. So if your competitors start doing much more than you, you're typically going to start dropping down the page. So even if your ACOS or ROAS is the exact same as last year, you could be doing a lot worse. If you're not keeping up with the rate of the category, and to the next point, it's not always easy to get first party data. You could always use third party, but I don't love the data discrepancies we see with scrapers. So leaning into things like search query performance report to figure out what was traffic last year versus this year. How am I converting last year versus this year? What are my click-through rate differences can be a really great way to look at things. AMC is also another really big unlock and I think that's where you guys are doing a lot when it comes to things like CAC and LTV. Can you talk a little bit about what problems you're trying to solve for your brands? Speaker 1: Yeah, 100%. And ultimately it comes back to, you know, brand X comes to us or, you know, we're partnered with them and we have a slew of ASINs that we want to spend across SKUs, what have you. Each of these products is, you know, maybe some are more established. There are core winners. Some of these are new products that have launched maybe, you know, earlier this year or just over the past few months. And it's like, okay, we have all these products. We have this budget to work with. You know, how are we going to ensure that this is going to, you know, give us the greatest potential for growth or maintaining or increasing market share again into Q4 when we know in specific categories, you know, Intent to buy really starts to pick up. So looking at things, you know... Outside of overall revenue, conversion rate trends, again, us versus the category. Now it's starting to get a little bit more in depth relative to, again, maybe we can tie SQP reporting at large to this. Look at that in one specific lens. You know, if we're not converting at a specific rate where the category is, maybe it's not an ads problem. You know, maybe it is something on the PDP that needs to change. It's our offer. What are competitors, you know, priced at? What does their PDP look like, content at view? But at the same time, trying to understand at face value, you know, we're running at a $1 ROAS on this product. In the short term, or right now we are, but is that a bad thing when we're overall shooting for a blend of like 2.53 when we start to look under the hood deeper and realize, okay, what is the LTV repeat purchase rate? What is the effect of that capturing a new to brand customer at a $1 or even sometimes less in specific categories where it's so aggressive to compete? What does that ultimately mean for the business long term? And then from there, and something I'll call out Ashley Earl, one of our newer gals to the team, who is really helping kind of deep dive some of this for some of our partners. Ultimately, relative to the catalog and where we're investing, you know, 80% of our dollars starting to categorize and give roles to specific products or categories. And give those each different objectives or main KPIs behind the strategies that we're going after. Maybe some we can have a little bit more room to be. Inefficient because we know that the value of capturing that new-to-brand customer the first time pays dividends down the road. Whereas some, you know, maybe these items are newer. They're not converting where we need them to be. They need to run tighter. You know, those are going to run at lower bids. They're going to just kind of be our efficiency workhorses in the background. Of course, they're paying attention to what they're doing, but It's really those top SKUs that have a lot of eyes on them and a lot of attention from customers and these businesses relative to revenue and how much impact they have and just getting a cleaner view of, hey, this is ultimately the impact this item is having on your brand. Speaker 2: I love that. I think that's such a great response. Oftentimes, brands come to us and they want the trifecta. They want a high ROAS, they want total sales growth, and they want to be as incremental as possible. Oftentimes we're having to go to them and be like, you know, let's actually align on realistic expectations here because you can't always do all three at the exact same time. What you can do is slice and dice your portfolio, which is what Nick's mentioning here, in order to allocate resources in a way that maybe hits all objectives. In a unique fashion, we like to state that it's similar to your stock portfolio. There's going to be phases of the business or your life where you're more risky. You're all in on Bitcoin, right? There's going to be phases in your life where you need, you know, just a consistent return. And you can shift things around really quickly as the market's reacting or as your personal objectives change. That's exactly how we manage ads. We look at the portfolio and say, you know, what SKUs are driving new customer acquisition or maybe have a higher LTV. And then we also segment the campaigns that we are managing behind those SKUs in a very similar fashion. We have campaigns that are focused on market share versus conquesting versus efficiency. And that's about as close as possible as I would say that we can get to that final number. But I think the problem is, is it's not something you can just automate away. You really have to understand the context and all of the conditions outside of something as simple as keyword and bids to, I would say, come to that outcome. Speaker 1: A hundred percent, yeah. I think that kind of circles back to, you know, when we or our partners are looking to AI to help, it's like we need to ensure first and foremost that the tool that we're using has, you know, all of the data, all the pieces. Because if there's one piece missing, again, like if you just give it spend, sales, ROAS, you know, it's going to have pretty aggressive points of view on what's happening. It's going to be pretty aggressive. But at the same time, if we just took that at face value and it's like, oh, well, yeah, let's just cut all bids by 80% based on that because we don't have that repeat purchase rate or LTV side. And again, that's it's super category specific. You know, not every category has high repeat purchase rates. And LTV, that continues to compound. But if we're missing specific pieces of data that you need to pull from AMC, what have you, you start to make, there's an opportunity to make decisions a little bit more blind. And that's what makes me a little bit worried, like kind of in the background, not that we're doing that, of course, but just fearful for brands that might be doing that elsewhere. Speaker 2: Yeah. Absolutely. We've already seen the issues with some of the MCPs released or with, you know, when the AI hallucinates. And yet you have brands that are trying to build all of these things completely in-house. And I absolutely think it's beneficial to connect all of your data. That is why we're in the process of building our own MCP. I think it's majorly advantageous for brands. But you have to have the right context. It's not as simple as going to your AI and saying, hit this target ACOS, because to Nick's point, at the end of the day, it's not going to take into consideration things like who to brand. It's not going to look at your ad type overlap. It's not going to look at time to conversion, which is another big one. Last time I looked at our agency time to conversion data, I think that over 30% of our brand sales happened after 24 hours of the first click. Now, I know you've worked on quite a few different brands where day parting and week parting really matter, especially when it comes to B2B. But as a whole, for the agency, over 30% of sales come after 24 hours of the first click, which is pretty incredible and should also be taken into consideration. That's not data you can get in Ad Console. That's provided through Amazon Marketing Stream, which means you need the right tool provider or software. Our nexus that pulls in those insights and if you're just downloading a search term report and blindly saying, you know, what's wasted ad spend or what's my cost objective, you could be really making a bad decision. Speaker 1: Yeah. And I mean, even just to that point alone, it's like, I mean, every month is different. Every week is different based on how is the category behaving? How are customers behaving at different times of year? You know, a customer in a high impulse category with a giftability side of things and, you know, in the middle of summer outside of, you know, Prime Day is not going to convert the same way it's going to December 20th, you know? So, um, Yeah, I mean, you just have to look at all the data. You have to use historical as much as you can. You have to understand that there are disruptor brands that, you know, right now could be launching some social media campaign that's going to completely disrupt what you thought you were going to do these next couple of weeks. And how do you combat that? You know, you got to take it in stride and adjust and be ready to adapt. Speaker 2: Well, I think that is a pretty good end notes on that mic drop moment. I have some rapid fire questions for you. You have maybe 60 seconds to answer them, so be as concise as possible. What is your favorite ad type and why? Speaker 1: Sponsored brands video for clear reasons. Very impactful, highly engaging, new to brand. Disruptive. Speaker 2: Favorite retail media network? Speaker 1: Amazon. Speaker 2: That should have been a given. Amazon is funny because it's so complex, but then you go to learn all of the others and it's a cakewalk and you're like, I need better negating. I need better audience control. I need better branded versus non-branded segmentation. Speaker 1: I'll say don't sleep on Chewy though. Nice platform that they got going on over there too. And obviously a completely separate consumer base. I like what Chewy's got going on, but I'm also a pet guy. Unknown Speaker: That makes sense. Speaker 2: Favorite match type? Speaker 1: Exact. Speaker 2: Yeah, I would have to say so. Speaker 1: I'm a control freak. Speaker 2: It's a lot more work, but if you do the work, it absolutely pays off. Favorite AMC analytics report. Speaker 1: Ooh. I think just because it's so fresh on mind, it's got to be related to LTV side of things for sure. Speaker 2: That one, that one makes sense with the episode. And I think it's access to data that a lot of brands have wanted for a long time, but never had the opportunity to pull. So I would agree. That was amazing. Last question. What are you most excited for over the next six months? Speaker 1: I mean, I'm a big advocate for, you know, planning and executing tentpole events. So I'm just very excited to see ultimately what happens for these Q4 periods across all retail media networks. I'm excited to see, of course, how the Amazon events go, you know, relative to having very close pulse on that from an agency perspective, but also across other retail media networks. I guess, I mean, just like interesting to see like what's going to be the biggest update probably coming out of Accelerator Unboxed as well, you know. I feel like there's, I don't know, who knows, you know. I know it's very Amazon specific, but of course, always excited to see the rollouts that happen across Walmart, Target, again, Chewy, and just continue rolling with the punches and adapting as needed. Speaker 2: Okay, one more bonus question. How many animals do you have currently in your house? And what are some of the most unique? Speaker 1: Oh, gosh. Total count. I mean, we're talking probably like 12. And if you include fish, probably like 35, 40. Most unique, probably the axolotls, which are behind me. Honestly, we have three of those. And if you don't know what it is, you can look it up. Good luck typing it out. Speaker 2: That is fantastic. We'll have to do a show and tell episode for all of your animals that you have, which will be lots of fun, I'm sure, for the audience. But Nick, thank you so much for joining and providing as much value. If you are listening in and you have any questions from the podcast or you're interested in learning more, follow Nick on LinkedIn or shoot a message to any of us and we'll be more than happy to help. Thank you so much, Nick. Speaker 1: Thank you, Destaney.