The Best Amazon PPC Strategy in 2020
We often get asked what is the best Amazon PPC strategy or structure. Over the years advertising on Amazon has gotten more and more competitive. The result is more and more sellers competing for prime ad placement, which has, in turn increased bids. This increase in bids has made the goal of maintaining profitability more difficult. This begs the question. Is it possible to use Amazon PPC to grow sales and not lose your shirt in the process? The answer is yes.
In an effort to map out the ideal PPC structure, I will outline a few high-level numbers and then I will give more explanation around the numbers.
Organic vs. Paid Sales
Over the years, we have managed hundreds of Amazon accounts. The accounts that perform the best have close to a 70/30 organic sales-to-paid sales ratio. This means that if your account is running correctly you would have 30% of sales come from your PPC campaigns. Of course, when creating new listings or launching a new account you would have trouble hitting 30% depending on the product category and niche you are selling in. This is meant to be a goal to work toward not necessarily a hard and fast rule.
Ad Campaign Structure
Amazon allows us to build two different types of PPC campaigns. They are Manual targeted and Automatic targeted campaigns. Both have their place and provide different results.
Automatically targeted campaigns are campaigns where Amazon will crawl your listing content and automatically generate keywords for you. Auto campaigns are meant to help in generating keywords. These campaigns are lower bids and are less precise.
While Manual campaigns are campaigns where the seller/agency selects the keywords and then can adjust bids at the keyword level. These campaigns are higher bids and are precise.
The goal is to use these two campaign types to complement each other. The ideal structure here is again a 70/30 ratio. (70% manual and 30% auto). I have seen campaigns closer to 90/10 (90% manual vs 10% auto), and this can work very well. In order to operate in these types of ratios, you need to have a very close eye on performance and spend.
Optimal Ad Efficiency
The most efficient way to run your ad campaigns is to use what is called “keyword harvesting”. Keyword Harvesting is the process of moving keywords into specific targeting campaigns. Say that you have an automatic campaign already running in your account. The first step would be to add two new manual campaigns in your account. I would name them something like this:
- Manual Broad Harvested
- Manual Exact Harvested
Step two would be to download the keyword reports within your account. Then open that file in excel or Google Sheets. From there, you want to filter the sheet by orders. Now you want to copy any keyword that has had at least 1 order and move into the Manual Broad Harvested campaign. The benefit of this campaign structure is that you now have far more control of the keyword bids once now that they are nested in a Manual campaign. You will also want to filter the sheet and copy any keywords that have had more than 5 orders and paste those into the Manual Exact Harvested campaign. These keywords are the cream of the crop because they have had 5 conversions, and we can be the most aggressive with our bids in this campaign.
Keyword Harvesting is part of every ad campaign that we manage for our clients here at Evolved Commerce because it works! Remember the purpose of this campaign structure is to gain more control of the keyword bids. Control, if managed correctly, will lead to very efficient ad campaigns. Best of luck!