Generally, you want to use 1 SKU per AdGroup. Here’s why
#1. If you mix SKUs with different prices, you won’t know how profitable your search terms are.
#2. If you mix SKUs with different variations, you won’t know which ads are most effective to advertise.
For a more detailed explanation of why these two things are true, and why they matter, read the long version, here.
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PPC: The 7 mistakes people make with their Amazon Sponsored Ads – #2 Dirty AdGroups
This is #2 in a 7 part series entitled “The 7 mistakes people make with their Amazon Sponsored Ads / PPC.”
At the end of this post you’ll learn why you should (almost) never include more than one Product Ad in any given AdGroup. I’ll show you a very common example of how a sample seller could increase their profit 300% just by organizing their adgroups properly.
Whenever you create an advertising campaign in Sponsored Products, Amazon will ask you to do two things.
- create at least one adgroup, where you specify the keywords you want to target (in a manual campaign),
- Then they will ask you to specify at LEAST one product that you want to advertise for those keywords.
It’s a trick question, don’t fall for it. Just choose one. But first, a list.
Things that can be dirty:
1. Your pop.
2. Your south.
Things that should not be dirty:
1. Your AdGroups.
Here’s why, and it’s really simple:
You’ll have no idea which search term is making you money, for which product.
When you download your search term reports (you are downloading your search term reports, right?) they will tell you how many impressions, clicks, sales, etc you received for your product right?
Wrong.
They give you
1. Campaign.
2. AdGroup
And THAT’S it.
So, here are two easy scenarios where this becomes ruinous.
SCENARIO #1: Different PRICED Products
Let’s pretend you sell Dog Leashes. You create an adgroup, and you add the following two products.
- Campaign – Dog Leash
- Adgroup – Dog Leashes
- Products
- Rope Dog Leash ($10.99)
- Retractable Dog Leash ($34.99)
- Keyword: “Dog Leash”
Great. Right?
What happens next is 10000 people log into amazon and type: Dog Leash, and of those 10,000 people some 50 will buy your dog leashes.
You’ll get a report that basically says
- Campaign – Dog Leash
- AdGroup – Dog Leashes
- Conversions – 50
With a number of individual reports for individual keywords.
Which leash did they buy? Which keywords were profitable? Which leash is good to advertise? Which one should you bid less on? Which one can you bid more for? Who knows? You sure don’t.
This is because you have a dirty adgroup. Meaning the reporting for each search term will consist of sales for the $10.99 product MIXED with sales for the $34.99 product.
If your PPC cost was $50 and you sold $500 in $10.99 leashes that would mean one thing, but if you sold $500 in $34.99 leashes that mean a different thing, especially if your profit margins were radically different.
Let’s pretend you make $25 for each retractable leash, that makes sense because of the higher profit margins, and you only make $2.00 for the $10, leash.
Selling $500 of retractable leashes using $50 of PPC means you generated $325 in profit.
Selling $500 of rope leashes using $50 of PPC means you generated $80 in profit.
That means for every $1 in profit you generate advertising for rope leashes, you would generate 300% more, if you’d spent it ONLY on the retractable leashes.
But since these sales are all mixed in the same dirty adgroup you have no idea how profitable this keyword is, for these two products, and you’ll never know that you can increase your profit by 300%, just by focusing on the more profitable product.
SCENARIO #2: DIFFERENT VARIATION PRODUCTS
“Well all of my products are the same price so this doesn’t really apply to me.”
Unfortunately, the same rules apply my friend.
It’s tempting to throw both of these leashes into the same adgroup, and why not? They’re both $11.99 so you’ll know exactly how profitable your search terms are. Let’s assume you make $5.00 per leash sold.
Imagine the following report:
Campaign: Dog Leashes
Adgroup: Dog Leashes
Impressions: 50000
Clicks : 300
Sales: 100
CostPerClick : ~ $.33
Revenue : $1199
PPC Spend: $100
Answer the following questions:
1. How much profit did you generate?
ANSWER: $400 ($5 per leash profit * 100 leashes sold – $100 Advertising Cost)
2. Which leash is your most profitable leash to advertise?
ANSWER: No idea.
It’s impossible, from this report, to know which of these 100 sales was the blue leash, and which was the black leash.
What if people were clicking on them an equal amount, 150 black, and 150 blue, but 100% of your sales came from people clicking on the black leash?
If you knew this, you could stop advertising the blue leash (or maybe stop selling it altogether) and cut your PPC spend 50%.
With just this one piece of information you go from generating $4 for every dollar you spend on PPC to $8. That’s a 100% increase in profit, just from knowing how your individual variations are actually performing, and you can only know that by separating them in your PPC Campaigns.
So. Keep your adgroups clean!
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PPC Tip #1 TLDR – Budgets
If you like brevity:
- Make sure you have either an overall budget set (that value is Daily), or that you’ve counted up all your campaign budgets.
- Separate you campaigns by profitability, at the very least ONE for your most profitable and a second for your NOT QUITE SO PROFITABLE keywords.
- Check your budget regularly. If you are hitting your cap you’re probably doing something wrong.
If you want more explanation, check the longer version of this post here:
Or if you need help with your campaigns, reach out in the comments.
PPC: The 7 common PPC / Amazon Sponsored Ads Mistakes- #1 Budget
This post is part 1 in a series of 7 posts all about the, you guessed it, 7 most common mistakes people make with their sponsored ads/PPC strategy*. Once you’ve read these posts you will be ahead of 99% of Amazon sellers.
*Strategy is a generous word, because a lot of people’s PPC “strategy” is the same strategy you might use when trying to get a spider off your back. A lot of screaming. A lot of flailing. A lot of panic. Auto Campaign.
(There might actually be 8 or 9 posts, Amazon recently released some updates)
In your defense, it’s okay. PPC is mind numbingly boring, and I can’t promise to make it less boring, but so far we’ve talked about spiders and I feel like if you google “PPC” and “Spider off your back” this page is going to be the only hit, so that’s a start.
So the first thing people mess up with their PPC?
TOTALLY SCREWING UP THEIR BUDGETS
Budgets are so complicated that even though it’s #1 of the 7 things people screw up, there are actually three different kinds of mistakes people make. So this numbering system is already sort of a mess, but it’ll be fine. We’ll get through it together.
So here’s sub-mistake #1 of mistake #1. Catchy.
Budget Mistake #1 – No Overall Budget Caps
If you learn NOTHING else from this post, please, learn this. Set a daily budget cap for your entire campaign.
It’s this easy.
- Log into Seller Central
- Click Advertising
- Click Campaign Manager
This # is the most you can spend on your sponsored ads. Please note this # is daily. So if it’s set to $125, your monthly spend will be ~30*125 ($3,750).
An interesting thing about Amazon is that it will almost always spend your money, and this number is an average.
A lot of sellers make the mistake of thinking if they set their daily cap to $125, then they will never ever pay more than $125 a day on advertising,
This is wrong.
The truth is, that with a daily cap of $125, Amazon makes sure that, over the course of a month, you never spend MORE than $125 on average per day, over the entire month.
This means that if on days 1-29, you’ve spent *only* $20 on advertising (out of a possible $3,750), Amazon will try it’s best to spend $3,730 on the final day of the month.
That’s right. You could spend $3,730 in advertising in one day, which would make your -average- spend $125.
So, if on days 1-29 you have spent a grand total of $20, Amazon will try its best to spend $130 on day #30. Because, much like you, Amazon loves money.
Question: What does this button do?
If you are very sure of what you’re doing you can click the button on the left which turns off global limits.
If you turn this off, Amazon will *only* use your Campaign Budgets to manage your advertising spend.
A lot of sellers make the mistake of turning this setting off, and then having 40 campaigns, each with $20 budgets. This is an easy way to get a $24,000 (40 campaigns x $20 budgets x 30 days) bill from Amazon at the end of the month.
This leads to the next budget problem, which is also a structural problem but I’ll include it here because money, right?
Budget Mistake #2 – Mixing Your VERY PROFITABLE and KINDA PROFITABLE keywords.
I was listening to a podcast from a leading, and boring, ‘guru’ in the PPC space and she or he started off by saying “You probably want a budget of $50-$200 on your converting campaign” and I had two thoughts back to back.
Thought #1.
“Wow what an interesting choice to deliver this content with as little excitement or intonation as humanly possible, ensuring that I am both confused and bored and maybe a little sad inside, I wonder why she or he chose to do that? Did I fall asleep? I think I may have also fallen asleep. Wow.”
Thought #2.
“Wait why would you only have one converting campaign and give it a unified budget?”
The idea of having a “converting campaign” is like this.
Imagine there are three people in front of you. Each of them says “Hey, if you give me money, I’ll give you even more money back until I run out.”
(This is actually how PPC works).
You give a dollar to person #1, and he gives you back $2. Cool. So you give them a bunch more.
You give a dollar to person #2 and she laughs and gives you back the shiniest nickle you’ve ever seen.
And then you give a dollar to person #3 and she gives you back $20.
If these 3 people were standing in front of you, how much money would you give to person #1? Person #2?
How much more money would you give to person #3?
Person #1 (+$1)/Person #3(+$19) are both considered “Converting” because you made money on those deals.
Person #2(-$.95) is considered “Non Converting” because you lost money on that deal.б
Mr. PPC guru suggests that you should set up your campaigns so that you give $50+ a day to person #1 and person #3, and let them split it.
This is fine if you don’t like money.
If you like money, mixing these campaigns is безглуздя, which if you don’t speak Ukrainian will just look like nonsense, and if you do speak Ukrainian, it will still look like nonsense. Either way, mixing these two “converting” keywords in the same campaign is nonsense, just absolutely senseless. And yes, cents-less, you make less cents.)
The problem is that by lumping all of those keywords into the same campaign means that Amazon will *indiscriminately* give $50 to person #1 and person #3 until you’ve spent all $50, and maybe person #1 is just quick on the draw, and way faster at spending your money than person #3.
The best thing to do is to separate your “awesome keywords” and your “pretty good” keywords into two different campaigns with two different budgets.
Now, this is a rabbit hole, of course. You could make an infinite # of campaigns for infinite numbers of profitability, but if you even just split it so that your top 20% of performers go in one “bucket” with its own specified budget and your other 80% go in another, this can have a massive effect on how much money you make, simply by leaving more room in your budget for your most profitable keywords.
Which brings us to
Budget mistake #3 – NOT CHECKING YOUR DAILY PPC SPEND
Here’s the thing. If you are spending 100% of your daily budget on PPC you’re probably making a mistake. That means that Amazon _could_ have spent more money, but didn’t simply because you put a cap.
Which means, assuming you have profitable keywords in your campaigns (and under most circumstances you should almost *exclusively* have profitable keywords in your campaigns) that means you didn’t spend money on profitable keywords because you ran out of money.
Let me rephrase that more simply because it bears repeating:
Hitting your daily budget probably means you didn’t turn money into even more money.
Hitting your daily budget means you turned off the magical money making machine.
*Yes there are weirdo scenarios where you might not need to spend on PPC because you’re already ranked #1 for all of your keywords etc etc, so why spend to be #1 in paid search and organic, because maybe your PPC spend is cannibalizing your organic spend but this only applies to like 1 out of a million people and that guy’s name is probably like Richard or Steven or something and no one likes him anyway because who gets to be #1 for all 20,000 of their search terms? No one and I bet Richard/Steven didn’t think to A/B test to MAKE SURE that ALL of their terms were cannibalizing, nope, they didn’t unless Richard/Steven was showing off, and no one likes a show off, Richard/Steven, NO ONE.
So, check your Amazon PPC spending regularly, not necessarily every day, but definitely at least once a week, and more frequently after you make any changes. If you are hitting your budget caps every day then you are doing something wrong.
It means you either are
1. Losing money on unprofitable keywords.
2. Not making as much money as you can on profitable keywords.
Maybe Both.
Q&A: How to automatically schedule sponsored ads/ppc and save money? (aka Dayparting)
Did you know that every marketplace has “high shopping times” when people are clicking to buy, and “low shipping times” when people click just to look around?
The problem, is that Amazon has NO problem showing your ads to people who are very unlikely to buy, but more than happy to spend your valuable advertising budget.
Rather than manually log in and disable/re-enable your ads every morning and night, Amachete makes it easy to automatically schedule your campaigns to turn on and off when people are actually shopping.
Here’s how:
(Assuming you’ve already activated the PPC link)
1. Click on the AD TIMER logo on the menu.
2. There you’ll see a list of your currently scheduled timers. If this is your first timer, you won’t see anything, except for a blank screen, which I guess counts as something.
3. After you click the only button you can click on the screen you’ll be presented with a list of your advertising profiles. It’ll look a lot like this. Just click on the one that has a campaign (or campaigns) that you’d like to automate.
4. You’ll then see a list of campaigns you can specify that you’d like to automate. The # on the far right is the number of keywords in that campaign.
5. This is where the magic happens. Chart magic.
This is a chart of your sale volume over the last 30 days. As you can see from this chart sales pick up right around 6am, and drop off pretty sharply at around 9pm.
6. So, below that we’ll specify the following hours for the advertising schedule.
7. Then click CREATE TIMER and you’re DONE.
Amachete will now automatically turn on and off your campaigns at those times every day and night.
*Note: We automatically convert all times so they display in the timezone of the target marketplace.
Happy Selling!
Team Amachete
Q&A: How can I download all my reviews using Amachete?
Periodically you might want to have a full copy of all your reviews. Now you can download them in a CSV from Amachéte in exactly three clicks.
- Click on the REVIEW MONITOR option on the side menu.
- You’ll see a list of your products with their review totals and averages for each marketplace
- Click on one of the marketplaces
- This will take you to a page where you can see all of the reviews for your product.
- For your third and final click, the green download button is your best bet.
- Then you’ll receive a lovely CSV file which you can use to search through your reviews, sort them by date, sort them by rating, and you’ll even have the URL/HTTP Web link for each order so you can see it on the web.
Happy Selling!
Team Amachete
Q&A: I’ve received a patent infringement take down request, what should I do?
Chances are? Nothing.
Right around 4th quarter I receive a number of fake patent infringement letters telling me that my product is a fake, which is insanely ironic and annoying.
Here’s an email I received through buyer-seller messaging at the end of October.
Here’s a more convincing one I received directly to my email, a few weeks later. It even comes from a very real seeming Amazon address (I haven’t bothered to check to see if they’re spoofing it or what. Or maybe the Seller Performance Team knows it’s not an actionable complaint but passes the message along)
The thing is, I know this product doesn’t infringe on any patents, so I simply ignored them.
Why would anyone send fake cease and desist letters? Because a lot of people won’t know any better, and there’s money at stake.
Sales for this product were pretty great yesterday, I can understand why someone wanted less competition
In summary. Don’t infringe on people’s patents, but don’t believe someone just because they’re telling you that you’re infringing on someone’s patents.
Amazon will take your listing down if you _actually_ infringe, they don’t need your help to do it.
Q&A: Why are there ASINs in my Search Term Reports?
Here’s a good question I get from time to time, with a lot of wrong answers being given.
Here’s an easy way to understand why something shows up in your Search Term Reports.
If a user is looking at [X] and they click on your ad, [X] will show up in your search term reports.
So, if a user is looking at “Amazon’s search results for the word ‘pickle juicer'” and they click on your ad, you will see “pickle juicer” in your search term reports.
However, what happens if a user doesn’t pick on your ad (just pretend there is one) and they click on that first pickle juicer which is actually a pickle fork because there’s no such thing as a pickle juicer, work with me.
If they scroll down because this isn’t a pickle juicer they want and they see YOUR product down among the related products, and then click on it, Amazon treats this product page the same way it would a search result, and says “Well, a shopper was looking at this, and then went to your product, so you should know. Their ASIN is X.”
Okay I’ll just Negative Exact Match them.
According to this Amazon Employee, you can not Block ASINs, nor can you negative exact match them.
So. To recap:
1. If a shopper is looking at search term results, and clicks on your product, you will see a search term in your reports.
2. If a shopper is looking at an asin (a product), and clicks on your product, you will see an ASIN.
3. If a user is looking at the sun, and they click on your ad, well… Sunglasses are a small product, nice markup, light weight, but with a lot of competition. I wouldn’t recommend it.
If you’d like to find an international product, and 3x your Amazon business, click here.
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Cheers,
Phil
Q&A: Does it make sense to sell a cheap product?
This question comes up quite a lot, and the answer is…
Yes. Of course.*
As a general rule you can assume it makes sense to sell a cheap product, whenever you see someone selling it because… why else would they be selling it?
*There are weird fringe cases where a person might sell something at a loss, but Occam’s razor suggests that most people are selling things because it makes them money. In business, it’s safe to say that profit is everything.
The question with Amazon is actually never about the price of a product, the real question of worthiness is about the profit. Selling a $100 item 20x a day seems great because that’s technically a $730,000 a year business.
However if that item costs them $94 after shipping, manufacturing, Amazon’s commission, sales tax, PPC advertising, etc, it’s really a $43.8k a year profit business.
Compare that to an item that you sell for $12 but actually only costs you $5. At 20x a day that item actually generates more profit than the $100 item.
Beware the Add-On Badge
Items below a certain price (generally under $10.00) fall under the auspices of the “Add On Item” program. Amazon won’t ship these items by themselves because the cost of shipping might eat into their profit margin. Again, profit is everything.
This means that no one can really buy your product unless they purchase another product in the same order. This can greatly affect your sales, unless it’s the type of product that people frequently by multiples of, or with another item.
NOTE: I’ve heard a rumor that if you start your price at $9.99 and gradually lower it, you can bring the price lower and avoid add-on status, than you could if you were to just set it at a low price to begin with.
So, set your price to $9.99, then $9.79, then $9.59, etc, and inch your way to your lower price and see what happens.
Perk: Fewer Returns!
There’s an added upside to selling a cheap item. Fewer returns. If you buy something that costs $50 and it doesn’t work, you’ll likely return it. $12? Meh. You won’t even bother.
Now, we are of the opinion that you should never knowingly sell a mediocre product, but there are some wheels that will always be squeaky no matter how much grease they receive so it’s nice to cut back on the number of times you have to interact with them.
So, to recap. Check your costs, find your profit, make sure your price isn’t too low, and go for it.
Happy Selling!
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I’m running out of stock what should I do?
First. You should be very very very quiet with this complaint or else someone that’s still sitting on 2,000 fidget spinners might spin all of them at your face in jealousy. Fidget spinner deaths are never pretty.
Second. Rejoice. This is the best problem to have in FBA.
First: Here’s what you shouldn’t do…
Gradually raise your price to slow down your sales to stay in stock.
Please don’t do this.
Amazon is a little bit like a bitter ex- and that they never ever forget, which is why if you ever get back together with them they will 100% remember the last thing you did.
So, if you were selling 200 items a day and then broke up with them (went out of stock) and then got back together they’d _assume_ you were selling 200 items a day and put you right back on page 1 with all the other winners.
If you were selling 200, then 100, then 20, then 2, Amazon says “Wow, this item really was getting unpopular at the end right before they went out of stock, so let’s just…place this here. On page 17. Page 17 is nice. It’s a fixer-upper. It has charm.
Step 1. don’t muck with your price by raising it.*
(*you can muck with it a little. sometimes by raising the price you might discover that you sell more. So, feel free to raise it until it has an adverse affect on your sales)
(i’m not sure the word muck is nice. It feels wrong when I say it and also when I type it, so maybe keep that in mind too. It’s the least important part of that step though)
Step 2. You can screw with your price by lowering it.
Screw just seems worse than muck but we’re stuck with it now gang.
If you lower your price as you are running out of stock, your sales velocity will actually increase (go figure) and then instead of going out of stock with a 200/sale a day item, you’re going out of stock with a 250/sale a day item.
It’s like if you’re breaking up with someone and then on the very last day you buy them a Tesla as a break-up gift. “I can’t be with you but here, it’s basically a huge battery with wheels I hope you love it.”
The current reigning theory is that when you come back in stock, Amazon will honor the 250/day rate and rank you accordingly.
Step 3. When you go out of stock close your listing.
To extend the broken relationship metaphor, imagine you break up with your ex- but in a great way. “Honey I love you but I’ve been invited to go to Botswana to help with the starving kids and I just can’t do long distance but I’ll be back in 2 months because you’re the love of my life. Please wait for me.”
Leaving your listing open is like… occasionally texting your ex during that 2 month period, every couple of weeks… but instead of sending a sweet I love you, you’re just texting them this:
“Hey you kinda suck.”
Then when you get back after 2 months you wonder why they Hey Kinda Dont Like You Any More.
This is because while you’re out of stock for 2 months while your listing is OPEN, there’s the chance that your product will get returns. And when Amazon gets a return that it thinks it can resell, it will put it on the shelf. And then that one item will sell.
So now suddenly you’ve got 200 sales a day for a year and then nothing, and then 1 sale on one day. Nice. You Kinda Suck in Amazon’s eyes and they’re not gonna forget it when you get Backswana.
Step 4. Don’t forget to raise your price when you’re sending your inventory in.
It’s a dumb thing but Amazon loses things all the time, basically Amazon will look at your historical price for a product, and sometimes (but not always) they’ll just look at your list price. So if you send in 2000 items with a list price of $20 and Amazon loses them, they’ll give yoU $40k. If you forgot to raise your price from $10, you’ll only get $10k.
JK it’s $20k I just wanted to give you that brief moment of satisfaction from having caught me in a mathematical error, because I love it when I catch other people in theirs.
Summary
If all this feels like a lot of work to have to do with one product, imagine doing the same thing with twenty products. Yeah you don’t want that life and I don’t want that life for you either. The best thing to do is keep an eye on your products inventory.
If you have 5 products and it takes you three minutes each to check their sales vs inventory and predict their stock out 3 times a week, that’ll mean you’ll spend (5*3*3*4, show your work) 180 minutes a month just checking inventory. That’s THREE HOURS every month, that’s 36 hours a year.
Or you can just sign up for Amachete and we’ll give you an easy page where we’ve done all the math and accounted for how long it takes your manufacturer to ship it so that you’ll know exactly how many days you need before you press that buy button.
You can just glance at it. And we’ll let you know if it’s getting kinda close.
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