This article has been updated as of August 3, 2021 with new tactics and information.

Raise Profitability While Lowering Ad Spend in Sponsored Products Campaigns

At PPC Entourage, we have used Sponsored Ads campaigns as an important part of our strategy to create thriving Amazon businesses and then to consistently scale them.

A critical part of this process has been focused on Campaign Optimization.

Campaign Optimization is the process of finding problematic areas of your advertising, and then adjusting them to reduce wasteful ad spend and increase ROI.

Through strategic bidding and targeting, Amazon business owners are able to get the most out of their Sponsored Products, Sponsored Brands, and Sponsored Display campaigns.

Anyone can throw a product into a campaign, let it run for a while and hope that it generates sales. Sellers who conduct business this way are actually gambling, trying to find a winner before their funds run out. They are relying on luck to produce a winning Amazon advertising campaign.

And to make matters worse, by using this method, they are simply not learning anything.

Even if a seller stumbles into a winning campaign using this method, they won’t know how to make the necessary changes to improve results the next time out and will lack the ability to duplicate results in other campaigns.

To be blunt - sellers who operate their ads this way don’t last long.

Too often, Amazon sellers fail to realize their campaigns are set up in a way that is hurting rather than helping sales.

Every Amazon seller needs to master the art of Amazon Sponsored Ads campaign optimization to be successful in the Amazon advertising space.

Think of Campaign Optimization as the foundation from which you build the solid structure of your Amazon business from the ground up.

Here’s what you need to know in order to ensure that you have a strong foundation in place to build the most efficient and optimized Sponsored Products, Sponsored Brands, and Sponsored Display campaigns possible.

A quick note about ACoS

Sponsored Ads campaigns can generate sizable profits for an Amazon seller, if those campaigns are managed correctly with the right metrics. An important metric to track is the advertising cost of sales, which reveals the cost to acquire one customer.

Managing ACoS can help you quickly narrow in on the effectiveness of each Sponsored campaign, while continuously optimizing your ad spend will help you obtain a lower ACoS.

amazon ppc campaign optimization

The Three Phases of Campaign Optimization

Campaign Optimization can be broken down into three phases.

Phase 1: Bulk Edit (bulk optimization)

This feature was developed while working with some of our Amazon Advertising Management Services clients. We found that a number of them had not done much optimization in their Sponsored Products campaigns, and that their Sponsored Brands, Sponsored Brands Video, and Sponsored Display campaigns were virtually untouched.

Inside of PPC Entourage, we created a time-saving tool that would allow any Amazon seller to go back through the entire lifetime of a campaign and quickly find the “junk” (anything that contributed to needless ad spend), across all of their campaigns and turn it off.

Bulk Edit allows you to perform Campaign Optimization strategies across multiple campaigns and ad groups all at once. It is only done if you have seasoned campaigns that have been around a while. You can select any combination of campaigns, set filters (or use helpful pre-made filters), and then find under-performing SKUs, keywords and targets, search terms, and words.

You can apply sweeping bid changes all at once, pause individual SKUs within certain ad groups where they are not responding well to ads, and even add negative exacts on a campaign or ad group level in bulk. You can also find and optimize individual words that are your worst offenders.

The Bulk Editor allows sellers to optimize in the following ways:

  • SKUs Bulk Optimization (simultaneously find the SKUs that aren’t performing well across all of your campaigns)
  • Keywords/Target Bulk Optimization (simultaneously find the individual keywords or targets across all of your campaigns that are underperforming relative to your saved campaign parameters)
  • Search Term Optimization (simultaneously find search terms across all of your campaigns that are underperforming, generating clicks but no revenue.)
  • Negative Words Bulk Finder (will find the individual words that are not related to profitable sales across all of your campaigns at once)

It has more advanced features for high-level sellers, and also allows for expansion. For more information on Campaign Expansion and scaling your business using advertising, see this article.

Phase 2: Individual Campaign Optimization - 4 Strategies

This is where you dig a little deeper into each individual campaign to optimize it. Here are 4 simple Campaign Optimization strategies that can help you to lower your ad spend.

Strategy 1 - SKU Optimization:

  • The most basic form of optimization. Pause under-performing SKU's
  • Can be used on all campaigns that have multiple SKU's or variations

Strategy 2 - Keyword & Target Optimization:

  • Raise or lower keyword bid to align with your ACoS strategy
  • Pause irrelevant keywords when necessary
  • Best used on Phrase/Exact Match Campaigns
  • Also applies to Automatic Targeting Types (Loose Match, Close Match, etc.) and Product Targeting.

Strategy 3 - Search Term Optimization:

  • Used to find the individual search terms that are NOT converting for a given keyword
  • Can be used on both profitable and non profitable keywords within a campaign
  • Great for all campaigns (Research, ACoS Scraping, Phrase/Exact Match Type Expansion)
  • Find search terms that are dragging down the performance of your campaigns and use a “Negative Exact” strategy to eliminate further exposure
  • Works great for all campaigns, but especially for the Automatic, Research, and ACoS Scraping campaigns.

Strategy 4 - Negative Word Optimization:

  • Find the individual words that have not been linked to any profitable sales and use a “Negative Phrase” strategy to eliminate further exposure
  • Works great for all campaigns but especially for the Automatic, Research, and ACoS Scraping campaigns.
  • Use Negative Phrase carefully

Phase 3: Autopilot Mode

Now that all of your campaigns have been optimized in bulk and then fine tuned, automation can be turned on so that minor adjustments happen in the background, without spending time on them manually.

Use this feature of PPC Entourage to look at the individual keywords and targets in your campaigns, in order to help you to hit your Target ACoS.

Autopilot Mode can be used for any campaign type.

Use Autopilot Mode to monitor each keyword’s ACoS, CTR%, and amount of impressions, as well as to raise or reduce bid prices based on the criteria you have set (defaults settings can also be used).

For both automatic and manual campaigns, you can set up autopilot to add poor performing search terms as negative exacts based upon the number of clicks without sales or CTR%.

How Autopilot Mode functions:

  1. Autopilot runs once-a-day (at night)
  2. Autopilot reviews every target within the campaign. It then looks at the keyword bid price and relates that to your established ACoS. It then attempts to match your bid price to your ACoS.
  3. Autopilot may raise (to generate more impressions for successful campaigns) or lower your bid price (in an attempt to get a more favorable click price)
  4. Autopilot looks at 90 days of data by default
  5. Autopilot allows you to automatically eliminate a search term (Negative Exact), if it meets certain predetermined criteria based upon search term data. This can be tailored to the type of campaign you have setup (Phrase/Exact Match)
  6. Autopilot will ignore keywords, allowing you to keep a keyword in your campaigns, preventing it from being optimized out under any circumstances. Bid prices will not be raised or lowered. Search term optimization will not be performed

Autopilot Mode will help you to manage your Sponsored Products campaign costs more efficiently.

The Customer Buying Cycle

When creating your Amazon ads, it is important to have a well thought out, fully developed advertising strategy.

There are countless variables to consider when creating each individual campaign, and this becomes more complex when accounting for how multiple campaigns will work in tandem to achieve your marketing objectives.

Entourage Management Services bases our advertising strategies on the marketing concept known as the Customer Buying Cycle. It is a tried and tested marketing principle that has proved effective for us as we’ve managed tens of millions of dollars in ad spend on Amazon.

For more information on how to use the Customer Buying Cycle for Amazon advertising, see this article and the accompanying educational video.

In conclusion...

It is essential to optimize all of your Sponsored Products, Sponsored Brands, and Sponsored Display campaigns on a regular basis. First and foremost, it keeps your campaigns fresh and gives you a clear picture of their performance over time.

Campaign Optimization once again is the critical building block that will help you to create and maintain a successful and thriving Amazon business.

Implement these three phases of Campaign Optimization as your personal playbook for realizing the financial and personal freedom that you desire and deserve.