When structuring an Amazon sponsored products (PPC) campaign, sellers are faced with the question of which products and which keywords they want to include in which ad groups and campaigns. Unfortunately, there’s no one size fits all for this. The right structure is dependent on the size and homogeneity of the seller’s selection, the seller’s strategic targets, and other points of consideration. However there are guidelines that you should follow when structuring your campaigns, and we’ve listed our suggestions below:
1. Structure your campaigns consistently
Your PPC campaigns permit a rough structure for your ad activities. This can be both good and bad news. Typically, a campaign structure will provide you with a set of characteristics that follow one or more of the characteristics below:
- By product category (for example: men’s shoes, keyboards, cameras, etc.)
- By brand (for example: Nike, Adidas, Puma etc.)
- By top sellers (products that pull in the most sales, e.g. top 10)
It’s important to be consistent with whichever organizational method you use for your campaigns. If you change your organizational structure, it could lead to repeat ads; for example, when you create one campaign by brand and another by category.
2. Group similar products in the same ad group
A set of products and a set of keywords are made for each ad group. Because all products should appear for that keyword set, it’s important to keep in mind that you should choose a set of products that contextually fit those keywords. So, you should put all products into an ad group that are suitable (to be found via search) for those keywords.
Note: If you use this method, be careful when analyzing profitability of your Amazon ads. Even though the products in the same ad group have similar keywords, they might have very different profit margins – which in turn would impact the profitability of your ads. That’s why you should always know what a good ACoS for your Amazon ads would be before you start any Amazon PPC optimization.
3. Create different ad groups for keywords with different levels of generality
The larger your selection of products is, the larger your number of keywords with varying levels of specificity will be.
Example: A seller has a selection of shoes
- For all shoes, the keyword ‘shoe’ is relevant
- For some of the shoes, the keyword ‘men’s shoes’ is relevant
- For some men’s shoes the keyword ‘men’s sneakers’ is relevant
Now if the word ‘men’s shoes’ were placed in all ad groups for men’s sneakers, boots, loafers, etc. then you’d easily lose track of which ads are shown for which keyword bids. In order to avoid this, more general similar keywords can be included in separate ad groups (for example: ‘men’s shoes’, ‘shoes for men’). The top-selling products, for example, can then be included in these ad groups:
Campaign 1: Men’s shoes for Product Category 1
- Ad Group 1 (‘men’s shoes’) for general keywords of that product category (‘shoes for men’, ‘men’s shoes’, etc.) and top sellers
- Ad Group 2 (‘men’s sneakers’) for specific keywords (‘sneakers for men’, ‘men’s tennis shoes’, ‘men’s joggers’ etc.) and corresponding products
- Ad Group 3 (‘men’s boots) for specific keywords (‘men’s boots’, ‘hiking boots for men’) and corresponding products
4. Let Amazon identify relevant keywords for you in an automatic campaign
Run an automatic campaign as well as a manual campaign with the same exact products. Let the automatic campaign run for a couple days/weeks and then evaluate which search terms have generated the most sales. Then transfer these search terms into your manual campaign.
- Create an automatic campaign and an ad group
- Create a manual campaign and an ad group
- Evaluate the search terms of the automatic campaign regularly (‘Search Term Report’ in Seller Central) and transfer the relevant and highest-converting search terms into the keywords of your manual campaign with a higher CPC bid.
5. Optimize listings to ensure ads are shown for all relevant search queries
Amazon likes to be sure that the ads being shown on their site are relevant for the customer. This is why generally only ads can be shown for keywords that are also contained in the product listing text (title, attributes, description, search terms). Check whether keywords that don’t have any impressions are contained in your product listing text. If that’s not the case, then you should add those keywords into the listing text to make sure that ads will be able to be run for them – thereby reaching a broader potential customer base.
6. Eliminate unwanted search queries to reduce costs
Amazon ads aren’t always shown for only those exact search terms that you’ve bid on as a seller. Search queries can vary from the keywords you’ve entered according to match type. In order to prevent unnecessary costs from occurring, there are two options:
- Set keyword match types
- Set negative keywords
When you’re entering in keywords for your sponsored products, Amazon gives you three match types to choose from:
Broad: The Sponsored Product ad can be displayed if the query includes all words that have been deposited as a keyword. The order of words doesn’t matter. In addition, the formula considers spelling variations, misspellings and synonyms as matches.
Phrase: The ad can appear when a search query uses the keyword(s) entered (i.e. one or more words) in exactly the order given. Close variations (e.g. singular / plural) are considered matches.
Exact: The ad can only appear when a search query matches exactly the keyword given. Plural and singular forms are considered exact matches here as well.
Amazon also offers negative keywords. Your ad will not appear for user queries containing these negative keywords. These are the two different negative match types to choose from:
Negative exact: Your Sponsored Product ad will only be excluded if the search query exactly matches the negative keyword you’ve entered, or with a minor variation (for example, singular / plural).
Negative phrases: Ads will be excluded if the search query contains the negative keyword as a part of the phrase or in whole.
7. Track your PPC spend based on product performance
In most cases, there are many different products in one ad group that share the same keywords. It’s become clear over time which products sell best within an ad group. In order to target the maximum number of sales with that ad group, products with poor performance can slowly be removed from the ad group. This way, you’re sending impressions and clicks to those products which will more effectively convert clicks into purchases. By adjusting the CPC bid price, you can control where (on which page) in the search results your ad will appear and also how many clicks it’ll get. The goal of CPC optimization is to find that ‘sweet spot’ where ad spend and turnover (spend / sales = cost of sales) reach a desirable level.
8. Define your target Average Cost of Sales (ACoS)
Your target cost of sales should at least be generally laid out. It can differ according to the purpose of your campaign. If you’re primarily targeting profit, then your target figure will be based upon your profit margin. Target figures for cost of sale are typically between 5% and 15%. In contrast, if your goal is to advertise a new product and improve its organic visibility, then you might want to pay more for your sales or even take a loss in the short term in order to secure profit over the long term. Your target cost of sale In such cases would be up to 100%.
9. Track and optimize your CPC bid
The optimal CPC bid differs according to keyword. That’s why every bid can be controlled separately for every keyword in manual campaigns. Keep in mind that a solid amount of data is needed as a basis for evaluating bids. That’s why you should wait at least one week between adjusting bid prices. The general rule of thumb for CPC bid optimization:
- If the cost of sale for a keyword lies over the target value, the bid should be lowered in order to test whether ad spend and sales can be brought to a desirable ratio.
- If the cost of sale lies under the target value, then it should be tested whether the ad’s reach – and sales along with it – can be expanded by raising the bid price.
- If keywords aren’t generating any sales or are getting too little impressions, it should be tested whether a higher bid can make them ‘active
- Keywords that only generate costs and no conversion even over a longer period of time – or they can’t be adjusted into a profitable bid price range – should be stopped
Campaigns should be updated regularly in this way in order to reach the ‘sweet spot’ where ad spend and sales reach a desirable ratio.
10. Start bidding on new keywords with a higher price
If you’re adding a new keyword, then you should set a higher CPC bid price at first (at least $0.75, depending on category). New keywords don’t yet have any click history to show that Amazon can take into consideration when controlling ad display. In order to get the keyword started and have it generate some impressions and clicks, a higher bid price must be assigned to them. As soon as some click history has been built up, this bid price can often be lowered in order to successively find an optimal bid price.
Sellics Amazon PPC Manager tool
Whether you’re looking to increase sales or lower your ACoS, you can now fine-tune your Sponsored Product campaigns within Sellics. Our PPC Manager tool provides an in-depth overview of your sales, PPC costs, ACoS%, and Cost Per Click (CPC) data in real time. We sync the data from your Seller Central account and into your Sellics dashboard, where you can see the performance of your individual products. Your PPC Manager dashboard is customizable, and you can further analyze the performance of your Amazon sponsored product campaigns by looking at your impressions, click through rate (CTR), and conversion rate (CR).