There are more than 9.5 million registered sellers on Amazon worldwide. This number clearly shows how great the competition on the platform is. To improve the visibility of your products and also optimize the organic ranking in the long run, many sellers resort to placing ads, because with the help of ads you can increase the number of impressions and clicks and improve the conversion rate. Without ads, it is extremely difficult to create awareness for products and generate sales on Amazon.
Sellers who advertise on Amazon have to continuously optimize their keywords and adjust their offers. This process takes a lot of time and resources. Therefore, most advertisers switch to an automated solution that allows them to focus on their core business.
In this article, you will learn why you should automate your Amazon advertising as well and what to look for when using a tool.
The importance of optimized advertising campaigns
Ads on Amazon are only worthwhile if the performance and the ACoS are monitored regularly. The term ACoS stands for Advertising Cost of Sale and describes the ratio of advertising costs to sales generated. This is one of the most important key figures when monitoring advertising expenditure.
It is essential to have this control in order to be able to evaluate your advertising strategies and adjust them accordingly. However, if you advertise a large number of products, you quickly lose track and ultimately control of your advertising campaigns. Unoptimized advertising campaigns quickly lead to throwing your money out the window.
If your advertising costs skyrocket and you generate less revenue at the same time, you have a high ACoS. If your goal is higher visibility or a product launch, a high ACoS may be intentional, but as a rule, a high ACoS is not economically worthwhile.
A very low ACoS, on the other hand, can be a sign that your advertising potential is not yet fully exploited. As a result, your campaigns for important keywords may not be played out and buyers may be drawn to your competitors.
How you can optimize your campaigns
While non-optimized ad campaigns represent a high risk for Amazon Sellers, optimized ad campaigns offer great opportunities. Before you can start optimizing your campaigns, you should first analyze your performance data. You can then optimize your ad campaigns according to your goals.
Essentially, there are 3 options available to you for optimization:
- Automated management by a PPC management tool, such as BidX
- Manual management by the seller himself
- External management through the assignment of an agency
Advantages of automation:
With the help of an algorithm, a PPC management tool automates the optimization of PPC campaigns. In advance, goals are defined that should be achieved with the advertising campaigns. The bids are then automatically adjusted depending on the goals.
In the following, we will discuss the advantages of automated campaign management through a tool versus hiring an agency as well as manual management.
1. Save time
To keep up with your competitors' ads, your bids and keywords need to be adjusted continuously. Therefore, if you manage your ad campaigns manually, you would need to keep an eye on their performance 24/7. This manual control is almost impossible, especially if you sell and advertise multiple products.
Although bid and keyword adjustments are essential when optimizing Amazon ads, they often get short shrift when managed manually in day-to-day business. However, to have more time for other core tasks of your business, you can easily outsource this task. Agencies, for example, can take over keyword and bid management for sellers. However, since this activity is very time-consuming, as already mentioned, working with an agency is often quite costly and you partially hand over control completely.
Automation tools, on the other hand, can do the job more cost-effectively and to your liking. The tool uses your advertising budget as efficiently as possible and adjusts keywords and bids accordingly. In addition to a previously defined target ACoS, which is the basis for any bid adjustments, it is also possible to set individual rules. This gives you much more control and you can track all changes even afterwards, thanks to rule logs.
2. Documentation and data overview
For creating campaigns, advertising data from the past can be particularly helpful. For evaluation and optimization purposes, the search term report and the targeting report are the most important. However, Amazon only grants access to search term reports for 65 days in the past and to targeting reports for 90 days. In order to still have access to your data after this period, you would have to download your reports every 65 or 90 days.
Third-party tools pull data from Amazon through the API and can collect, store, and automatically analyze it. Many tools can thus offer you lifetime access to your advertising data.
3. Avoidance of over/under steering of the optimizations
Tools can avoid over- or understeering when decreasing or increasing bids. This is because bids are increased or decreased according to certain rules and not based on instinct. If the bids are lowered too much, it can happen that certain keywords are no longer played. On the other hand, if the bids are raised too much, the ACoS increases enormously.
4. Continuously active
Automation tools are active 24/7. In contrast to manual control or cooperation with an agency, weekends, holidays or vacation do not play a role with a tool. Automation processes as well as current analyses and reports can be executed or provided at any time.
5. No slip-ups
When manually adjusting PPC campaigns, mistakes are often made inadvertently. Mistakes creep in quickly and can lead to false interpretations, for example, if the daily budget is set incorrectly.
Such slip-ups cannot happen to an algorithm. For this reason, the probability of errors in automated optimization is reduced enormously.
What to look out for when using a tool:
Even though using an automation tool has numerous benefits for you as a seller, there are a few things you should keep in mind for successful use:
1. A tool is not a magic weapon
While a tool obviously has a variety of benefits and can help you tremendously in the long run, you shouldn't expect to increase your advertising success by 100% right after signing up. Especially if you have little knowledge about Amazon Ads and PPC management, it may take you a while to learn how to use an automation tool.
A personal consultation with the tool provider can be beneficial to ensure optimal use.
2. A combination of tool and consulting can be useful
While a tool can only work with the data provided by the seller, personal consulting, for example in the form of a managed service, can take into account the entire economic situation of the seller. BidX offers a managed service starting at €3,500 per month for sellers, vendors and agencies. In addition to the benefits of the tool, this way you can benefit from our expertise with regular status update calls and strategy consulting. If you are just starting to advertise on Amazon and therefore the managed service is not an option, you can also book a workshop with us.
3. Even a tool costs time
Familiarization with the functions of a tool naturally takes some time. The tool itself also needs time in order to be able to make target-oriented and cost-efficient adjustments in the long term. This is because the automated adjustments are based on statistically significant results obtained from past data. This allows patterns in customer search and click behavior to be identified and bids to be adjusted accordingly. In the long run, however, a tool is definitely worthwhile and will save you time and money and increase your profitability.
The bottom line
Using an automation tool is a game changer for many sellers on Amazon. Automated optimization of advertising on Amazon has many advantages. A tool can increase sales and reduce costs at the same time. Once you get the hang of the tool, it provides the best results 24/7 while you can focus on your core business.
If you want to achieve long-term success with PPC campaigns, BidX is the right place for you. BidX continuously analyzes the performance of your campaigns with self-learning algorithms and makes them more profitable through bid and keyword adjustments.
BidX offers you numerous advantages. With the help of 1-click setup, you can create campaigns up to 12x faster and even make campaign settings for multiple products at the same time, which saves you time as well. With BidX you can say goodbye to under performing keywords. In the BidX tool, good and bad performing keywords are automatically detected and adjusted. The automated bid adjustments ensure a more profitable use of your ad budget.
