One of the biggest changes on the Amazon platform over the years (and there's been a lot) has been around Amazon PPC. Gone are the days where sellers can put on an auto campaign and watch the low-cost sales roll in the door. The landscape is a lot different now, in fact, it can often be difficult to make a profitable sale at all! As the times change, successful sellers need to stay current on cutting-edge strategy, and Amazon sponsored ads are no exception to this rule.
Our advertising PPC experts at Nectar is constantly testing and analyzing different types of Amazon PPC strategy, and we have been fortunate to help our customers continue to see success in the area of Amazon PPC optimization. Below is an example of a recent client who was having some success with their Amazon sponsored product ads, but Nectar was able to get under the hood and find key areas of optimization that were being overlooked.
Nectar began working with this client in the middle of January 2020. In the prior year, the client had done over $1,500,000 in sales. As a seasoned seller, this client had exhausted all options for further optimizing their own Amazon PPC advertising.
The graphic below represents Nectar's first 45 days of PPC management for this client. As you can see, in that 45-day period, the client’s sales from advertising increased 6 times from about $2,500 to $15,000. Sales however, are only one part of the story. In addition to drastically increasing sales, the client’s advertising cost of sale (“ACoS”) decreased 5 times from over 50% to slightly under 10%.
One of the reasons for Nectar's continued success with Amazon PPC strategy, is our ability to properly analyze key data points. Amazon sellers typically assume that the only way to achieve profitability with Amazon PPC is to decrease your cost per click ("CPC"). You can see however, that during the 45 day period where we drastically increased this clients sales and decreased ACoS, the CPC across all campaigns actually increased!
What does that mean? It means that Nectar eliminated wasteful spend on "bad" keywords and reallocated the advertising spend to the keywords that are converting profitability even though they were slightly more expensive.
The final piece to the puzzle is knowing when to scale. As you can see form the graph below, Nectar quickly reacted to the success it was achieving for the client by steadily increasing the ad spend by 3 times from $600/month to almost $1800/month while still maintaining an overall decrease in ACoS from over 50% to under 10%!
In sum, Nectar eliminated spend on wasteful keywords, targeted more profitable keywords, and increase spend while lowering the ACoS and increasing sales—the perfect result!
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If you’re interested in having Nectar manage your PPC to see similar results, make sure to contact us at [email protected]