Amazon has grown to become the preferred marketplace for more than 310 million customers, with the online retailer accounting for more than 54 percent of all product searches. In other words, Amazon has supplanted Google as the most popular product search engine on the internet. So, how can your company take advantage of this rapidly expanding and intensely competitive business while yet being profitable? Let’s take a look at some Amazon ads optimization methods that you may implement immediately to increase your effectiveness and sales volume. To achieve your return on investment (ROI) objectives, you must select the most appropriate Advertising Cost of Sale (ACoS), which is the primary indicator Amazon uses to demonstrate how your advertising expenditure results in targeted sales. To do so, you must choose the most appropriate Advertising Cost of Sale (ACoS).
The following is the formula for calculating it: ACoS is an acronym that stands for advertising expenditure divided by sales.
For example, suppose you spent $170 on advertising over the course of a month, which resulted in $680 in income. ACoS = 170/680 = 25% of the total. So, what constitutes a good ACoS? Ultimately, it is determined by your profit margin. Your profit margin is calculated by dividing your profit per unit sold by the price. For example, if you sell a $100 product on Amazon that costs $75 to manufacture, your profit per unit sold is $25 dollars.
Profit per unit divided by the price of the product equals profit margin.
$25/$100=0.25
Your profit margin is 25 percent, which is really good.
So, what is the maximum amount of money your advertising cost of sale may be in order to break even and remove waste from your advertising efforts? In this particular instance, 25 percent.Your first concern, of course, should be making a profit. As a result, your ACoS should be reduced. Maybe 10 percent or 15 percent of the population. It all relies on your pricing point as well as your company’s requirements.
The good news is that there are several improvements you can make to improve your Amazon Customer Service (ACoS). Spending less money on advertisements is not the only strategy to minimise your Ad Cost of Sales (ACoS). Here are nine places where you should concentrate your efforts in order to optimise your advertising and boost performance.
Methods for optimize your Amazon Ads for your Brand
Optimize the product listings on your website –
Prior to considering advertising on the Amazon platform, you should first focus on creating effective product listings that are properly optimised for both your target audience and Amazon’s algorithm. Many companies advertising on Amazon continue to overlook this crucial stage, which results in poorer engagement, reduced audience intent, and fewer purchases.
You must err on the side of perfection, especially if your product is sophisticated or technically advanced. There are five frequent mistakes that businesses make when it comes to product listings that should be avoided:
low-quality images:
Maintain consistency throughout the content supporting your product — from the title and description to details and bulleted copy — by using keywords that are relevant to your target audience (more on this later). Look no further than Amazon’s own product listings to get a sense of how the company is promoting itself.
Duplicate listings:
If you have several listings for the same product, you are not only diluting your visitors, but you may also be directing them to a product page that is not optimised for search engines. Make certain that your items do not appear in more than one place. Working with Amazon Seller Support to have them removed is a good idea if this happens.
Optimize Bids
Your cost of advertising and ACoS success are ultimately determined by how much you bid on a keyword, ad group, or campaign in the first place. Amazon will display the average bids for keywords in the same way that Google does. As a starting point for making your bids, use this as a guideline. In general, you should bid lower on keywords with poor conversion rates and higher on keywords with good conversion rates. Increasing your bid or consulting the purchase box status to guarantee that your Amazon Standard Identification Numbers (ASINs) are qualified to serve are two options if your impressions are too low.
When it comes to optimising your bids, it’s all about striking a balance. Bidding high enhances your product rankings and may result in more clicks, but it also has the potential to raise your average cost per acquisition (ACoA). Bidding low might lower your product rankings and lead you to lose clicks, or worse, exclude you from participating in the auction entirely. The most effective technique is to experiment with various bid levels to observe how they affect performance.
Focus on keywords
The last, but certainly not least, is that researching the keywords that resonate with your target demographic is critical to improving your Amazon advertising efforts. On Amazon, there are three different forms of keyword match:
Exact match:
collects traffic that perfectly matches the search or is a plural of the phrase. If the search term was “sock,” the words “sock” or “socks” would be precise matches, but the phrase “red sock” would be a non-match.
Phrase match:
Traffic is captured with any variant of a keyword or key phrase, provided that the terms are spelled correctly and in the right sequence. The word “red socks” would bring up results for phrases such as “long red socks” and “red socks for sports,” but “red long socks” would not appear in the results.
Broad match:
When a single word inside a keyword or keyword phrase is employed, the term “broad match” is used to collect traffic. It makes no difference in whatever order the words appear as long as at least one of the search terms is included. In a search for “red long socks,” any combination of phrases containing the words “red,” “long,” “socks,” or any combination of these words would be tracked down.
Final Thoughts
The amount of money being invested in Optimize your Amazon ads is increasing at an exponential rate. If the current trend continues, it has the potential to overtake Google Shopping as the most popular shopping search engine for eCommerce retailers. Investing in performance marketing methods for Amazon advertising is an excellent way to ensure that your investment yields the most possible return in the long term.
