Expert Tips For Improving Amazon Ad Management Strategy

According to a report, Amazon’s average ad spend has increased tremendously in Q1 2022 and is predicted to continue increasing. This shows how immense the competition is on Amazon; it’s high time to take your Amazon PPC management game to a different level. 

Most Amazon ad management strategists start with the basic functions, learning from the process and adding best practices to their repository over time. But, if you want to witness quick improvement in your Amazon ad campaign performance, here are six Amazon ad management improving tips you can use to get more traction.

#1 Establish brand recognition with headline search (sponsored brands)
#2 Aim for flexible Advertising Cost of Sale (ACoS)
#3 Make the most of the flywheel effect 
#4 Center on the product-wise profitability
#5 Go for category-specific targeting for sponsored products
#6 Use manual campaigns for exploiting and auto campaigns for exploring

Let’s get into details.

#1 Establish brand recognition with Headline Search (sponsored brands)

Based on a survey, sponsored brands, previously known as headline search ads, get clicks and conversions by approx 18% of shoppers. The reason is sponsored ads appear above, below, and alongside Amazon search results and thus get viewed first. 

In addition to conversions, sponsored ads help advertisement strategists establish brand recognition and promote multiple product categories. 

Quick Way To Use Sponsored Brand (headline search ads)

Sponsored brands are one the best ways to improve visibility and get maximum results. Use them to establish brand recognition and make the most of the opportunity of incorporating a custom headline (brand name), brand logo, and Amazon standard identification number. You can also use ‘Sponsored Products’ to get clicks on your Amazon storefront and product page. 

#2 Aim for flexible ACoS

In Amazon, the lower the Advertising Cost of Sale, the better. But is it right to aim for lower ACoS only?

ACoS is calculated at the group level for automatic Amazon ad campaigns, but for manual ad campaigns, you can measure ACoS on a specific product level. Low ACoS may seem like the obvious choice, but every Amazon ad campaign has distinct objectives depending on whether you’re starting on Amazon, launching a new product line, clearing stock, or trying to generate current profits. The ACoS will differ accordingly. 

Quick Tip To Set Your Amazon ACoS Goals

  • For best-sellers, aim for lower advertising costs. The reason is they are already the best-seller, meaning Amazon itself will show them on top, and shoppers can find those products quickly.
  • For new product launches, go for higher ACoS (at least for a short period). The reason is higher ACoS helps gain traction and earn feedback in the early stage. 

#3 Make the most of the flywheel effect 

The Flywheel effect is a concept of using paid Amazon ad campaigns to generate earned media. Most Amazon ad strategists use this effect to ensure overall business growth. 

Earned Media/Paid Media

  • Reviews
  • Detail Page Views
  • Orders

Owned Media 

  • Product Content 

Here’s how Flywheel Effects contribute to improving Amazon Ad Campaigns

Paid Amazon ad campaigns bring in traffic to your Amazon storefront and product pages, improving the product’s ranking in the organic search results. High traffic and better rankings in the organic search result increase the chances that the product will get “Amazon’s Choice” recognition. In turn, the label ‘Amazon’s Choice’ will bring you more shoppers’ attention, conversions, and revenue. 

How To Take Advantage of Flywheel Effect In Your Amazon Ad Campaigns 

Track your performance against predetermined KPIs. Always remember that advertisement results are uncertain- so avoid the mistake of measuring Amazon ad campaign success based on ACoS. 

Note: It is best suggested to measure your performance based on total generated revenue, gross profit, and total advertising cost of sale. 

#4 Focus on product-wise profitability. 

Gather detailed data by directing your attention to product-wise profitability. Undeniably, each product has distinct profit margins, and it’s imperative to learn of the gross profit earned per product before adding an Amazon ad campaign to the mix. 

This data will show which individual SKUs benefit you the most from a paid Amazon ad campaign.

Quick Way To Leverage Product-Wise Profitability 

Analyze individual SKUs profitability and determine which products ensure the highest and lowest profit margins before running a paid Amazon ad campaign. Of course, it is meaningless to waste ad spend on products that won’t get you profit. Thus, it is best suggested to save each dollar by identifying the outcomes that could help most.

#5 Consider category-specific targeting for sponsored products

Sponsored Product is considered one of the most fruitful Amazon advertising options. Based on a survey, about 29% of Amazon advertising strategists use ‘Sponsored Products’ to get more traction. These product ads appear above the organic search results and get you more views, clicks, and conversions. 

In Sponsored Products, you can opt for category-specific targeting, where you can pair your products with your brand’s or other brands’ complimentary products. This helps you get more views. Moreover, it increases the chances of converting shoppers into customers.

The other category-specific targeting concept, PAT (an abbreviation of Product Attribute Targeting), enables advertisers to showcase their products in advertisements paired with your brand’s or other brands’ specific set of products or alongside products within a definite price range.

Best Way To Use Category-Specific Targeting For Sponsored Products

Consider manual targeting for Amazon Sponsored Products ad campaigns. Choose the product and bidding strategy, then select the category you aim to target- particular brands, price ranges, ratings, etc.

If you’ve just started on Amazon or launched a new product line, consider category-specific targeting and target competitive brands and products to take advantage of those searches.  This Amazon ad campaign strategy will allow you to reach your target audience, giving instant results. 

#6 Use manual campaigns for exploiting and auto campaigns for exploring

Set it and forget it won’t work in Amazon ad campaigns. You get minimal control with auto campaigns. Also, you didn’t allow to set bids on individual search queries in auto campaigns. It is primarily beneficial for sourcing keywords.

The Best Way To Leverage Auto Campaigns

Use auto Amazon ad campaigns for sourcing converting keywords and add those keywords to your manual Amazon ad campaigns. In addition, it is best suggested to automate all search term Amazon listing optimization processes as and when possible.

Final Thoughts

Amazon offers numerous ad types (video ads, product display ads, sponsored brands & products, traditional display ads, etc.) to put light on your products and get the desired results. Many experienced Amazon advertising strategists use a mix of all ad types to generate maximum revenue. But as a beginner, spending dollars on every ad type is not advised to get profits. 

However, if you want to level up your Amazon product listing game, employing the tactics mentioned earlier will help you generate higher revenue without costing you extra dollars on Amazon ads.