2022 Update: This article is Part 3 of an existing series on How to be More Efficient with Your Ad Spend. We have updated this blog with the most innovative budgeting and advertising tactics for the Customer Buying Cycle. Before diving into these new strategies, it’s a good idea to review Parts 1 & 2 of this series:
Leveraging the Customer Buying Cycle (CBC) is one of the most important ways for Amazon sellers to maximize every dollar of their Ad Spend, while increasing the odds of capturing sales from new and recurring shoppers.
Sellers should be familiar with the different stages of the Customer Buying Cycle because so that they are able to budget with maximum efficiency based upon which part of the CBC their potential customer is in.
When sellers are creating an Awareness/Discovery strategy, it’s important to set a clear budget as campaigns in this stage tend to run at a higher ACoS. The risk of Ad Spend being used on unproven audiences (no track record of interest in their products) is greater at this stage, so sellers should set realistic goals for how campaigns at this stage are used. Creating a budget also gives sellers clarity on how many different campaigns and seller tools they can utilize.
When determining a budget, sellers should consider their niche, time of year and allocating a percentage of their total ad spend budget (20% to 25%), to target relevant audiences…those mostly likely to purchase your products.
This process begins by sellers identifying the keywords, ASINs and categories that work well for their products.
Campaigns specific to the Discovery phase will ‘fuel’ the different campaigns that address the other segments of the CBC.
Remember to set an ACoS Target. This is a key step because without doing so, sellers run the risk of having their allocated Ad Spend budget eaten away quickly.
Go for an ACoS Target of 100% or less. The average range usually falls between 50% to 60%. While ads in the Discovery phase are typically higher ACoS, there are certain types of campaigns you can use to reduce the losses you take on research and discovery.
Consider this type of Amazon ad for the Discovery phase of the Customer Buying Cycle:
SPONSORED PRODUCTS:AUTO LOW
An auto campaign with a lower bid typically provides a few extra sales at a low ACOS. Sellers may wish to put all of their products into one Auto Low campaign in order to keep it manageable.
Goal: Find new search terms and ASINS that sellers can use in all other campaigns. Provides more ad inventory that allows sellers to fill out gaps along the customer buying journey.
Bonus Tip: Get more information about this campaign and all of the others listed in this article by downloading the free Entourage Playbook Series. It contains detailed overviews of 28 Amazon campaigns, plus video walkthroughs.
The goal is to place sellers ads front and center before online shoppers who are considering their products. Sellers want to help online shoppers to consider their products over those of your competition.
Sellers should use an appropriate percentage of their total budget to highlight the advantages that their products have over their competitors.
Identify the search terms, ASINs and categories that have converted well (generated 3 to 10 orders).
Category campaigns (with refinements) should be designed based upon the seller’s competitive advantages. The goal is to highlight advantages such as a lower price point, high star ratings, or a large number of positive reviews to “ethically steal” sales from your competitors.
An efficient budget allocation should be 25% to 40% of total ad spend budget.
Also, set an ACoS Target no more than 60% as a rule.
Consider this type of Amazon ad for the Consideration phase of the Customer Buying Cycle:
SPONSORED PRODUCTS: REFINED CATEGORY TARGETING
Targeting a seller’s main category and refining that category down to where the seller has an advantage over their competition (price, prime eligibility, or review stars).
Goal: Ethically steal sales from competition and benefit from their traffic.
Determine which keywords and ASINs are high impact (generate 10 or more profitable orders).
Sellers will want to pursue these aggressively during this phase of the CBC, using a higher portion of their Ad Spend budget. These keywords and ASINs are statistically shown to deliver sales and are within the desired ACoS.
Consider this type of Amazon ad for the Decision phase of the Customer Buying Cycle:
SPONSORED PRODUCTS: KEYWORD SCALE
These campaigns are designated to those targets that are consistently a seller’s top performers and are designed to SCALE. Typically use keywords or search terms that have 5 or more orders within an ACoS or 40% or less. Sellers can choose between having one target per campaign or several targets. Consider having one target per campaign for maximum control.
Goal: Get the sale, scale your advertising.
The goal is to keep customers returning to purchase from the seller’s brand and to reduce the likelihood that they will ‘stray’ to purchase from competitors.
Sellers should make sure to protect their brand against competitors possibly being shown beneath their brand name because they are advertising the seller’s brand name.
These protection types of campaigns generally have a low ACoS and should be done somewhat aggressively. Use Sponsored Products, Sponsored Brands and Sponsored Display ads to do this.
Consider this type of Amazon ad for the Post Purchase phase of the Customer Buying Cycle:
SPONSORED PRODUCTS: BRAND PROTECTION
If shoppers are searching for a seller’s brand name, then it is best practice for the seller to advertise for their brand name and show up first. Otherwise the seller risks losing sales to their competition.
Goal: Protect brand sales and keep shoppers loyal.
Product Identifiers | ACOS Target.
Bonus Tip Reminder: Detailed overviews, including videos, are available inside of the free Entourage Playbook Series. Grab your copy at this link.
Every seller’s goal should be to go after the most relevant audiences for their products in the most efficient ways possible. Knowing how to be more efficient with your ad spend is a great start.
The ultimate achievement occurs when your brand becomes a household name.
Think about the dreams that you have for the success of your Amazon business.
What will achieving the financial and personal freedom you desire mean to you and your loved ones?
He is the owner and founder of PPC Entourage, one of the original amazon ad software and management companies. Mike started off as a physical therapist in 2015 and just knew there had to be a better way so he started his ecommerce journey. Using the power of Amazon Ads, he built a 7 figure brand in less than one year. Now he helps other sellers do the same with free valuable education, PPC Entourage software and the ad agency. He is also the author of the Amazon Ads Playbook series.
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