Amazon Sponsored Ads Series: Episode 5
Amazon campaign is not a set-it-and-forget-it thing, it needs micro-level analysis. Your campaign might be spending dollars with zero sales and you might not even be aware of it. The data in Amazon is fragmented and is a bit complicated. So you will need to understand various concepts and the basics like how Amazon attributes sales, what are the metrics, how to scale the bids and much more. In episode 5 of Sponsored Ad Series, we will show you how you can analyze the profitability of your campaign. But first, let us understand the basic concepts.
Metrics:
Metrics can be used to determine the profitability of the campaigns. All the metrics are in the dashboard and are available in downloadable format. This means that it includes data from products promoted in the campaign as well as brand halo data. Brand halo conversion is when a customer has clicked on an advertiser’s sponsored ad and then purchases a product that is not directly promoted in the campaign but is still associated with the advertiser’s brand.
There are basically three types of metrics available for Amazon Sponsored Ads:
1. Industry Standard Metrics:
2. E-commerce Marketing Metrics:
3. New-to-brand Metrics (Only for Sponsored Brand Ads):
In 2019, Amazon rolled out this new feature that let advertisers estimate the cost of acquiring new customers so that they can better optimize their campaigns. The new-to-brand metrics can help determine whether the purchase was made by an existing customer or someone who is buying a brand’s product for the first time over the previous year.
Here are the new-to-brand metrics available to sellers:
- New-to-brand orders: The number of products ordered for the first time from the brand within the previous 12 months.
- New-to-brand sales: The total sales of new-to-brand orders.
- % of New-to-brand orders: The percentage of orders that are new-to-brand.
- % of New-to-brand sales: The percentage of total sales of new-to-brand purchases.
- New-to-brand units: Total number of units ordered in new-to-brand orders.
- % of New-to-brand units: The percentage of units from new-to-brand orders.
- New-to-brand order rate: The number of new-to-brand orders relative to the number of clicks (New-to-brand order rate = New-to-brand orders / clicks).
How Is Sales Attributed In Amazon Sponsored Advertising?
The attribution method varies between brands and sellers and also by ad types. The table below will explain in detail the sales attribution for brands and sellers as well as Amazon Sponsored Product Ads and Sponsored Brand Ads.
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Brand Sales Attribution |
Seller Sales Attribution |
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| Sponsored Products | Sales equal the total amount of a brand’s product sold within 14 days of clicking of an ad. This does not include the sale of brands sold by third-party sellers (independent sellers who offer a variety of new, used, refurbished, and collectible merchandise).
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Sales it associated with specific sellers advertising the product. After a customer clicks on the ad, Amazon will attribute any order that the shopper places for the advertised product and any other seller’s product within 7 days of click. In the campaign manager, sellers can view a one-week attribution for the same ASIN and other ASINs as well.
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| Sponsored Brands | Same as Sponsored Products but it also includes sales from third-party sellers.
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Sales are attributed for the advertised product and also include any products by the same brand as the advertised product. Sales will be the total amount of the brand’s product sold to customers within 14 days of them clicking on the ad.
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Let us understand with an example:
Example 1: A shoe brand is advertising running shoes through Sponsored Ads. A shopper clicks on the ad and purchases running shoes. Amazon attributes the sale to running shoe ad as it was a promoted product and it can have influenced the customer’s buying decision.
Example 2: A shoe brand is advertising running shoes through Sponsored Ads. A shopper clicks on the ad and purchases hiking shoes instead, from that same brand. Amazon will attribute this sale to the running shoe ad because the customer interacted with the brand’s advertisement and he has ultimately purchased something from that brand so the ad has somewhere influenced customer’s buying decision. This is called a brand halo conversion.
What About Cancelled Orders & Payments?
Amazon does include cancelled orders and failed payments in the sales attribution metrics. If in any case customer cancels the orders or payment does not go through then Amazon will exclude those numbers from the reported sales so that the sales numbers you get are 100% accurate and for the sales you have actually received.
Campaign Analysis – Simplified
Now that you are familiar with the metrics and how sales are attributed, you can learn how to access and manage those metrics to increase profitability. The most convenient and quickest way to manage your campaigns is through the advertising console – meaning the home page of your campaign manager. You can view the metrics at both the campaign and the account level. For easy viewability, the metrics are presented in a graph format. You can select two out of the given eight metrics.
The console also provides out-of-budget notifications.
Sellers can use advertising console to:
1. Export reports: Reports can be used to get a summary of clicks, spends and ACOS of all your campaigns. Sellers should download and analyze such reports at regular intervals to see the profitability as well as the status of the campaigns whether the campaigns are running, paused, ended or terminated.
2. Track spend: Performance metrics can be used to track spend so that your campaigns are spending the dollars within your advertising budgets. As we can see in the screenshot below, there are a few campaigns that have very high spend compared to sales. So, these campaigns should be paused immediately.
3. Analyze campaigns: Scale the bids, view the ACOS and determine the profitability of the campaigns. You might want to dive deeper into a campaign to view spend on each keyword so you can make proper optimizations.
For example, with a glance at the dashboard, we can identify that there are some campaigns that are not working well. They either need to be optimized or paused.
Then there are campaigns that are running really well, the seller can increase bids and budget for these campaigns.
There are basically two ways to optimize campaigns, either you can download the reports and analyze each of them to scale the bids or you can optimize campaigns directly from the Advertising console. We have discussed each of the methods in detail. Here’s how you can manage your campaigns manually through the Amazon advertising console.
Campaign Analysis through Advertising Console:
#1 Automatic Campaigns
Step 1 – Keyword & CPC Bid
- Lower the default bids if ACOS is more than the target value
- Increase the default bids if ACOS if less than the target value
Step 2 – Negative Keywords
Include all the keywords with high spend and no / low sales in the negative keywords. You can pull this data from the Search Term report.
Step 3 – Budget
Increase if the campaign is profitable and the budget has been exhausted.
#2 Manual Campaigns
Step 1 – Keyword & CPC Bid
- Lower the keyword bid if ACOS is more than the target value
- Increase the keyword bid if ACOS is less than the target value
- Lower the keyword bid or pause the keyword if the conversion is zero or very low
- For keywords with zero impressions, check if the keyword is there in your product copy and for keywords with the low impression, try to increase the keyword bid
Step 2 – Negative Keywords
Include all the keywords with high spend and no / low sales in the Amazon PPC Negative Keywords. You can pull this data from the Search Term report.
Step 3 – Budget
Increase if the campaign is profitable and the budget has been exhausted.
Sellers should do these activities once a day for their campaigns.
Campaign Analysis through Reports:
Downloadable reports are another way to access, optimize and manage campaigns. These reports provide detailed and account-level insight, sellers can use them to learn how customers are searching for their product and identify which product and keyword mix work best for them. There are a total of five downloadable reports that can be used to monitor campaigns.
1. Targeting report: It can be used for both Sponsored Product and Sponsored Brand ads. This report provides insight into sales and performance metrics for keywords in all campaigns that have received atleast one impression. Sellers can use this report to see how keywords are performing over time so that they can adjust the bids and expand the keyword list. This report can also help identify high and low performing keywords.
2. Placement report: This report provides visibility into the performance of a campaign between placements. Sellers can use this campaign to identify which placement helps the shopper find their product. This report is also available to both Sponsored Product and Sponsored Brand ads.
3. Search term report: This report helps the seller to identify the actual search terms used by the customers for searching the product on Amazon that resulted in a click on the ads. It collects data for promoted ASINs and the brand halo ASINs. Sellers can use this report to fetch the high performing search terms as well as for extracting negative keywords that do not meet the target figures. This report is available for Sponsored Product ads only.
4. Advertised / Purchased product report: This report provides insight into sales and performance metrics of your advertised ASINs in all campaigns that have received at least one impression. Sellers can identify how their ads are performing and if they need to change their advertising strategy or not. If you have more low-performing ASINs, it means that you don’t have enough keywords or keywords that are not targeted enough. It is also possible that you are not bidding enough for popular keywords. In Seller Central, both the advertised and purchased product reports are available. These reports are available for Sponsored Products only.
5. Performance over time report: This report shows a summary of clicks and spend as well as the cost of click over a specific period of time for all of your campaigns. Sellers can use this report to keep a check of their campaign status to identify whether their campaigns are running, ended, paused or terminated. This report is available for Sponsored Products only.
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Report Types |
Availability |
| Targeting Report | Sponsored Product and Sponsored Brand Ads |
| Placement Report | Sponsored Product and Sponsored Brand Ads |
| Search Term Report | Sponsored Product Ads |
| Advertised / Purchased Product Report | Sponsored Product Ads |
| Performance Over Time Report | Sponsored Product Ads |
Final Thoughts
That’s all folks. As it is rightly said the devil is in the details and the details mean optimizing each campaign at the ad group and keyword level. Optimization is the key to conversion and access to detail trends and micro-level campaign management is the only way to optimize the advertising campaigns. If all this sounds too overwhelming then consider outsourcing Amazon Sponsored Products Optimization services to Amazon PPC Expert at eStore Factory. Our tested, proven and strategically-developed tactics have increased sales for our clients and you can also be one of them. Just contact us.
Wait For The Next Part
In episode six we will learn about Sponsored Ads optimization so that you can get the best possible results. It will include all the useful optimization tips and techniques no Amazon seller should miss.