Welcome to the ultimate guide on reducing your Amazon Advertising ACOS! If you’re an Amazon seller or advertiser, you know that managing and optimizing your campaigns can significantly impact your profitability. In this article, we’ll explore seven powerful hacks that will help you lower your ACOS, boost your return on investment (ROI), and achieve tremendous success with your Amazon advertising efforts. So, let’s dive in and uncover the strategies that will take your campaigns to new heights.
1. Know your Keywords:
Keywords are an integral part of any successful marketing strategy or campaign. We should understand the importance of selecting the most relevant keywords for our campaigns. By conducting extensive research on competitor products and brands, you can ensure that you don’t waste their ad spend on irrelevant keywords, which can lead to increased ACOS. Not only does using the right keywords reduce wasted ad spend and lower ACOS, but it also helps to improve search engine optimization (SEO) and increase conversion rates. But selecting the right keywords is just the beginning. It’s important to continually optimize and refine your strategy as you gather data on your campaigns’ performance. That’s why you should closely track and analyze your results, making adjustments as necessary to ensure continued success. Choosing the right keywords is essential for any marketing campaign and helps reduce your campaign’s ACOS.
Learn more about keywords here
2. Have a Retail Ready Listing:
If you want to make your advertising efforts count, having a Retail Ready listing is an absolute must. Trust me, without it; you’re essentially burning your money with your own hands. It’s crucial to take a step back and analyze which component of your listing needs improvement based on certain KPIs. For instance, if you notice that all your campaigns suffer from low CTR, it’s time to take action. You could try A/B testing your Main Image or consider improving or changing your title. Remember, optimizing your listing for both SEO and conversion is critical to decreasing your overall ACOS because with a well-optimized listing, your conversion rate will be higher, and high conversion rate results in lower CPC and, thus, lower ACOS.
Learn more about retail readiness here
3. Maintain your bids regularly:
Maintaining your bids is a crucial aspect of effectively managing your Amazon Advertising campaigns and achieving a lower ACOS. By regularly reviewing and adjusting your bids, you can exercise control over your campaign performance and optimize your ad spend for maximum efficiency.
To decrease your ACOS, it’s important to identify and decrease bids on low-performing targets. These targets can include specific keywords or products that are not generating the desired results in terms of conversions or profitability. By reducing the bids on these underperforming targets, you allocate less budget to them, effectively minimizing wasted ad spend and improving your overall campaign efficiency.
On the other hand, it’s equally important to identify targets that are performing exceptionally well, with an ACOS below 5%-10%. By increasing your bids on these high-performing targets, you can capitalize on their success and drive even better results. Increasing bids on successful targets allows you to gain more visibility, secure higher ad placements, and potentially attract more qualified traffic, leading to increased conversions and a lower ACOS
Learn more about proper bid maintenance here
4. Read your Placements reports:
When it comes to optimizing your Amazon Advertising campaigns, it’s not just about managing your bids. Placements play a crucial role as well. By reading and analyzing your placement reports, you can gain valuable insights into the performance of your products on different placements. This information allows you to make informed decisions about which placements are driving the most favorable results for your campaigns.
By closely monitoring the performance of your products on various placements, you can identify the ones that generate higher conversion rates, lower CPCs, and ultimately, a lower ACOS. This knowledge empowers you to optimize your campaign targeting and budget allocation, focusing on the placements that deliver the best return on investment.
Remember, each product may perform differently on different placements due to various factors such as customer behavior and competition. By diving into your placement reports and fine-tuning your campaign strategy accordingly, you can gain a competitive edge and achieve more efficient ad spend.
In the image below, you can see that each campaign has different ACOS on different placement, just like that you can different KPIs like CPC, ad spend and ad sales as well for each campaign on different placements.
5. Do regular Negative Targeting:
In order to maximize the effectiveness of your Amazon Advertising campaigns and reduce your ACOS, it’s crucial to implement regular negative targeting. Negative targeting involves adding irrelevant keywords, placements, or audiences as negative targets to your campaigns. By excluding these irrelevant targets, you can prevent your ad spend from being wasted on uninterested or unqualified audiences.
Regularly reviewing and updating your negative targeting strategy every 7-14 days is essential for maintaining campaign efficiency. As customer behavior and market dynamics change over time, new irrelevant targets may emerge, and existing ones may become less effective. By staying proactive and continuously refining your negative targeting, you can optimize your campaigns for maximum performance.
When implementing negative targeting, it’s important to identify the keywords, placements, or audiences that consistently generate low conversion rates or high ACOS. These are the targets that are not aligned with your campaign goals or audience preferences. By excluding them, you can focus your ad spend on the most relevant and valuable targets, improving the overall efficiency of your campaigns.
6. Calculate your Target bids:
Not many people know about this; we usually hear and calculate our CPC by Dividing our clicks by spend, right? But there’s more to it. You can calculate your CPC by dividing your sales by clicks and multiplying it with your ACOS (with percentage). Now you can play with it and enter your desired ACOS instead of your own ACOS, and then it will give you the target bid or Max CPC you need to achieve to get your desired ACOS. This method helps you to make more data based decisions when optimizing your bids and cut out the whole guesswork. But, we never suggest setting your bid directly at 25% ACOS level, while your current ACOS is 48%. Because doing such a thing will ultimately reduce your Impressions (traffic), so what we do suggest is to read this data and then make a decision whether you should work on increasing your conversion rate, which shall bring down your CTO (Click To Order ratio) and eventually brings down your ACOS as well or Slowly and gradually start decreasing your bids (not more than 10%-12% at a time) while making sure that you maintain enough impressions and orders.
7. Properly Segment your Campaigns:
This is not something official from Amazon, but it is one of the aspects why people use Programmatic Softwares and Bulk sheets for their Amazon Advertising, even for mid-sized brands. So Amazon considers your overall campaign’s average CTR and CVR to measure your campaign’s quality score. Now if you’re targeting all the match types with a wide variety of keywords within a single campaign, then your average CTR and CVR would be comparatively lesser if you were to create a separate campaign for each match type, Right? Because if we talk about Exact match with laser-focused relevant targets, you will most likely get a higher CTR and CVR than targeting the same laser-focused relevant targets in the Phrase or Broad match. Make sense? But how does it affect your ACOS? That’s the main concern here. So the better campaign quality score helps decrease your overall campaign’s Cost per click and decrease CPC results in a comparatively lower ACOS.
Ready to slash your ACOS and maximize profits? Implement these proven hacks today and transform your Amazon advertising results. Take action now and unlock the potential of your campaigns.
If you have any further questions or need assistance with your Amazon journey, please get in touch with the BellaVix Team. We’re here to help you every step of the way on your path to success on Amazon. Don’t hesitate to get in touch with us today!
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