2017 Amazon PPC Roundup with Brian Johnson and Danny McMillan (Part2) – Session 022

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In this part 2 session Brian Johnson brings us the latest 2017 Amazon PPC roundup on the updates from Amazon and what it means to your keyword optimisation and amazon ads.

Brian has been in ecommerce for 11-12 years, was a student of AMS2 (Amazing Selling Machine 2) and with his engineering background he delves into testing everything.

Big Sellers approach

  • Stimulating Rank not just with PPC but also with Giveaways
  • Going after main keywords in their niche and in top 5 in five countries
  • They don’t feel the need to fill out the backend keywords as they are focussed on their main top 2-3 keywords and giveaways
  • They know how to get there and so haven’t focussed on the backend

Most Sellers don’t know how to use advertising

  • A lot of Sellers don’t know how to use advertising
  • The common belief is I’m going to turn on advertising, I’m going to pay Amazon for Traffic that will result in Sales and that’s what advertising is – Brian disagrees with that
  • Brian teaches that you understand your advertising objectives, is it launch, target audience, adjust for profitability
  • Figure out who your target audience is so that you can focus in your organinc product listing for ranking the best for organic rank and to be highest relevance for the phrases that attract the audience and perform the best for your target audience
  • Sales are great but they just prove a point of who your specific niche target audience are that I’m trying to focus my product to

Amazon PPC Roundup – The Maths of Ranking

  • You need 20-30 sales  a day on a keyword
  • Visibility > impressions > clicks > sales on those keywords
  • Aim for 15% Organic Sales over PPC Sales
  • New Seller – You might sell through 15% of your ‘Clicks’ if you’re lucky but your clicks might cost X

Organic to PPC is likely to be 50%

  • Lower conversion rates because you have no social proof
  • May use the advertising to initially Launch the product and get visibility
  • Find out who the target audience is and which phrases are they using
  • You may get a 5-10% conversion rate and as you get more established you may get 10-20% conversion rate
  • It’s hard to do this analysis up front as a new seller with no data

You have a competitive niche and each click costs you $3-5

  • You’ll need 20-30 sales / day on that keyword to stimulate the rank for the keyword
  • You need to get impressions in the beginning to have a  click-through rate to be able to get to the sale
  • Starting with nothing, you need to get to 20-30 sales/day on that keyword to get to page 1
  • It could be costly getting there if your click-through is $3-5/click and you’re only converting a small % of those
  • One day you get 5 sales but spend $500 and next day you get 10 sales and spend $500
  • You don’t want to use PPC on it’s own in order to get to page 1 – this may be an ineffective spend of your budget
  • You can’t just use PPC on it’s own – be careful
  • PPC is a tool and we’ll use it where it’s necessary

Amazon PPC Roundup – Beware of this approach

  • Don’t drop the price to below market rate, spend lots on PPC to get position 1,2 and 3 but don’t get enough Sales and end up spending thousands and not getting to Page 1 because you didn’t convert enough sales
  • Wishful thinking that turning on PPC advertising will get you to Page 1
  • The Advert could get on Page 1(if your copy is great and image works, etc) but that’s not the same as getting your product onto Page 1 in a cost-effective way to sustain your position organically and get profitable sales
  • Sellers focus on the No.1 keyword phrase and go after it – but forget that there’s 50,000 other sellers are considered relevant for this keyword phrase – they’re going up against an 800 pound Gorilla and Hoping to show up on page 1
  • Not realistic – you’d need to be in a very non-competitive small niche for that to happen without some other external forces such as external advertising, giveaways, promotion or other effort
  • Best use of Sponsored Ads advertising is to learn who your audience is – what audience niche is it that you’re trying to target
  • Knowing this will feed into your everything else you’re doing (other advertising efforts) – External promotion, external advertising, AMS Ads, optimising your listing to find that best ‘fit’ to get the highest organic position as a result of your advertising

Brian is a Champion of AMS and Sponsored Ads, but…

  • but use it correctly to really understand who your target audience in order to achieve your advertising objectives
  • Then change your advertising objectives to shrink it down to profitability
  • You don’t spend $500/day for the rest of your life!! – NO! Don’t do that
  • If you have a product that is so saturated and competition and poor margins with low profit margins and a 5% conversion rate – you’re going to struggle with advertising for a long time with that kind of a low conversion rate
  • Get in there, figure out who your target audience is and then get out

AMS Headline – Search Traffic

  • AMS using Headline Ads to find out Search Volumes (High, Med, Low) for traffic keywords
  • Is this pretty good data and a go-to tool? Yes
  • This is Amazon data (we often use external keyword research tools that use off-amazon search data to estimate)
  • We make the error that a keyword phrase that is searched by 50,000 people has more value that a phrase that only gets 100 searches per month)
  • That doesn’t necessarily translate because off-Amazon search is very different to on-Amazon search
  • Go to setup a Headline Search add (don’t have to run it) and add your keywords (can be upto 1,000) and it will tell you High/Med/Low or Very Low for expected search volume
  • Qualify this in that it’s the Headline Search AD search volume – not showing how many shoppers are on Amazon (hence the generality of Hi/Low etc)
  • It’s just showing you the relative value of one keyword to another keyword

Amazon PPC roundup – Brian’s AMS Tricks

  • Look at Keyword Research Tools and take the bottom 1,000 with less thatn 100 searches a month
  • Take these to AMS and feed it into Headline Ads and I find that some of those 1,000 are not showing up as ‘very low’ but maybe Low or even Medium

Second method:

  • Use Amazon suggested bid range (updated in last year)
  • Go in and create a Sponsored Ads campaign and create a new Ad group, dump 1,000 keywords into the ad group – don’t have to turn it on
  • In sponsored Ads (not AMS) you can look at the 1,000 keywords in the ad group and you can observe whether each keyword has a suggested bid range
  • Scan and look for which have the perceived highest value for Page 1 – chances are the ones with now value at all are considered worthless by other sellers as well
  • Suggested bid range only changes based off of the match type
  • Not off of Seller, Product or Campaign Performance only Match Type
  • Even with no stock you can switch this on and get a view – Brian does this before sourcing a product
  • What’s the keyword value, how expensive are they, what are the top ones
  • Those with the highest perceived suggested bid range will be most competitive – gives a different perspective
  • Most of my competitors are using this phrase in their keyword title and yet the advertising paints a different picture
  • You can reverse engineer what other sellers are doing before sourcing your product to see how expensive the advertising will be based on the page 1 competitors in your top 5 keyword phrases are

My sales are 88% down today

  • What’s happening? Is there an algorithm update or is everyone else affected
  • Seasonality can impact and can go on for weeks, months, etc
  • There are three things most Sellers observe or are affected by:
    1. Algorithm changes
    2. Amazon doing testing (indexes, new features, etc)
    3. Seasonality
  • Seasonality is so regular across the USA it’s a common one
  • There are many things that turn buyers ‘off’ – they don’t commit to a purchase because something doesn’t align with their Buyer intent

Distractions also impact

  • Holiday time, families have lots of functions (Friends arriving, Barbecue, Scouts weekend)
  • Their mind is on the three day weekend and not on buying on Amazon – they delay their purchase until they are back into the shopping experience
  • The few days leading upto a holiday / christmas / spring break distracts the buyers and impacts your conversion rates around this time
  • You can see the trend where it drops in the days leading upto the holiday and picks up again
  • Same thing for ‘event day’ – black Friday, Cyber Monday, etc. There’s a drop off directly before these days – they are on there and searching and clicking on your ads but not committing to the sales until the day of the event
  • Also, there’s no pixel that can track this and so it can be a hole in your data
  • For Prime day Brian recommends increasing your sales velocity in the run up to show you’ve more sales and so the algorithm might make you more prominent
  • For most sellers their conversion rates halved this year before Prime Day
  • Dead June, July, August and September – Prime day was in July as it was the quietest month of the year as no-one is around and buyers are distracted
  • Black Friday
  • Amazon is sending out emails to sellers to say double ad budget, ramp up your sales, to get more coverage before Black Friday
  • Brian says to half your budget and reduce the ad spend as the conversion rates will drop and your profitability tanks just before Black Friday
  • Then the day before Black Friday you turn it all back on – you have saved a bunch of money that your competitors just spent
  • Also, adjust your daily budgets to ensure you don’t run out by lunchtime – campaign daily budget cap

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