Give me 10 minutes, and I'll decrease your ACOS by 10% — Transcript

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1. 0:00High a cost campaigns eat into your
2. 0:02profits and you've probably been told
3. 0:03the fix is better keywords. A lot of the
4. 0:05time that's not where the money's going.
5. 0:07It's actually a handful of settings
6. 0:09sitting on default in your campaign
7. 0:11manager. On their own they look
8. 0:12harmless, but they stack on top of each
9. 0:14other and together they let Amazon take
10. 0:17a $1 bid and turn it into 25. You never
11. 0:20turn them on. Most sellers don't even
12. 0:22know they're active and they're a big
13. 0:23part of why your a cost is so high. I've
14. 0:26managed over $20 million in Amazon PPC.
15. 0:28And those settings are some of the first
16. 0:30things I check on when we take over an
17. 0:32account. So, give me 10 minutes. I'm
18. 0:34going to walk you through the exact
19. 0:35sequence I run on a brand new client
20. 0:37account to bring a cost down in the
21. 0:40order I actually do it. Six steps and
22. 0:43you can open your own campaign manager
23. 0:44and run every one of them today. Before
24. 0:47you change a single bid, you need one
25. 0:49number per product, your target a cost.
26. 0:52Because my a cost is 40% means nothing
27. 0:54on its own. On one product, that's a
28. 0:56disaster, and on another, it's fine.
29. 0:58Here's how you get it. Take your product
30. 1:00price, subtract your cost of goods, then
31. 1:02subtract Amazon's fees, and you can pull
32. 1:05those straight out of Amazon's fee
33. 1:06calculator. What's left is your profit
34. 1:09per sale in dollars. Divide that by the
35. 1:12product price, and that's your profit
36. 1:13margin. That margin is also your break
37. 1:16even a cost. That's the number where
38. 1:18your ads make you exactly nothing. Now,
39. 1:20the simplest way to run it, and this is
40. 1:22where I'd start most people, is to set
41. 1:24your target a cost equal to that break
42. 1:26even number. Your advertised sales pay
43. 1:29for themselves, and the profit comes
44. 1:30from your organic sales. That's a
45. 1:32perfectly good place to operate. Then
46. 1:34you adjust from there based on the
47. 1:36product. If it's a new launch with
48. 1:38barely any reviews, your conversion rate
49. 1:40is going to be low and you're not going
50. 1:41to be able to hit break even yet. So,
51. 1:43you accept a target above break even for
52. 1:46a while. You're paying for reviews and
53. 1:48ranking. And as the reviews come in and
54. 1:50the product converts better, you can
55. 1:52pull that target back down. And if it's
56. 1:54an established product with a pile of
57. 1:56reviews and it converts well, you can
58. 1:58push the target a cost below the break
59. 2:01even and make real profit on the ads
60. 2:03themselves. You want to do that for
61. 2:05every product you advertise. And while
62. 2:07you're in there, note which ones have
63. 2:09been running high and which have been
64. 2:11running low because we're going to come
65. 2:12back to that in step five. I'm going to
66. 2:14keep pointing at one account while we go
67. 2:16through this. the seller called Megan.
68. 2:18She had been with another agency for a
69. 2:20full year and her a cost was so high,
70. 2:23she wasn't making any money and she was
71. 2:25ready to be done with Amazon PPC
72. 2:27entirely. Keep her in mind because I'll
73. 2:29tell you where she ended up. Now, open
74. 2:31up your campaigns and sort by spend
75. 2:33starting with the highest first. That's
76. 2:35it. That's the whole move and it's the
77. 2:37one that saves you from wasting an
78. 2:39afternoon. Your a cost problem is
79. 2:41concentrated. it's sitting in a handful
80. 2:43of campaigns at the top of the list and
81. 2:46everything below them barely moves the
82. 2:48number. Then filter down to two groups.
83. 2:50Campaigns with a high a cost, meaning
84. 2:52they're making sales, but you're paying
85. 2:54too much for them, and campaigns with
86. 2:56spend and zero sales. Those two are not
87. 2:59the same problem, and you don't treat
88. 3:01them in the same way. The high a cost
89. 3:03campaign is working, it's just working
90. 3:05badly. The zero sales campaigns is
91. 3:07spending with nothing coming back at
92. 3:09all. So, that one gets cut harder. This
93. 3:11is where people go wrong. And the
94. 3:12strange part is that they do lower their
95. 3:14bids and budgets. It just doesn't do
96. 3:16anything. Say you've got a campaign with
97. 3:18a $30 daily budget and it's only
98. 3:21spending 15 a day. You go in, you
99. 3:23dropped the budget from 30 to 20. You
100. 3:25feel like you did something. Well, you
101. 3:27didn't. That campaign was never going to
102. 3:28spend more than that 15. So, you changed
103. 3:31a number that wasn't really doing
104. 3:32anything. Same thing on the bid side.
105. 3:35You've got a $2 bid and your actual cost
106. 3:37per click is $1. You bring the bid from
107. 3:40$2 down to $1.50. Nothing happens. That
108. 3:43keyword keeps taking clicks at a dollar
109. 3:45exactly like before. So, the rule is
110. 3:48this, and it's probably the most useful
111. 3:50thing in this video. To cut a budget,
112. 3:52you have to go below what the campaign
113. 3:54is actually spending per day. Whatever
114. 3:56number is sitting in the budget field
115. 3:57doesn't matter. And to cut a bid, you
116. 4:00have to go below the current cost per
117. 4:02click because the bid you set isn't what
118. 4:04you're actually paying. Anything above
119. 4:06those two lines is just moving numbers
120. 4:08around. Now, how far below? That depends
121. 4:11on how bad it is. If a keyword has a $1
122. 4:14CPC and the A cost is only a little over
123. 4:17your target, take the bid to about 95, a
124. 4:20small trim. But if the A cost is way
125. 4:22over your target, go further, 85, maybe
126. 4:2680 cents. And if it's got spend and no
127. 4:28sales at all, this is where you want to
128. 4:30get a little more aggressive. take a $1
129. 4:32CPC down to about a 75 cent bid. So, the
130. 4:36depth of the cut scales with the size of
131. 4:38the problem. Slight overage gets a nudge
132. 4:41and a keyword burning money with nothing
133. 4:43to show for it gets cut harder. And you
134. 4:45do the same thing with budgets on those
135. 4:46zero sales campaigns. You want to go
136. 4:49under the actual daily spend and
137. 4:51actually a little bit lower than you
138. 4:52would go on a campaign that's at least
139. 4:54converting. Now, let's talk campaign
140. 4:56manager settings because this one fix
141. 4:58can move an account on its own. So go
142. 5:00into your campaign settings and look at
143. 5:02your bidding strategy on each campaign.
144. 5:04If it says dynamic bids up and down,
145. 5:07Amazon is allowed to raise your bid by
146. 5:09100%. In other words, they can double
147. 5:11it. If it's on rulebased bidding, they
148. 5:13can increase your bid up to five times.
149. 5:16And then look at your placement
150. 5:18multipliers, your bid adjustments, the
151. 5:20top of search, rest of search, product
152. 5:22pages, Amazon business, audiences, all
153. 5:25those percentages. Those don't get added
154. 5:28on top. They multiply together. So, you
155. 5:30stack a few of those along with
156. 5:32rule-based bidding and Amazon can take
157. 5:34your $1 bid up to $25. That's the
158. 5:37setting from the beginning of the video.
159. 5:39Nobody sits down and chooses that. It
160. 5:41gets left on and then people wonder why
161. 5:43their cost per click doesn't match their
162. 5:45bids. What you want is dynamic bids down
163. 5:48only. That means Amazon can't raise your
164. 5:50bid ever. They can only bring it down,
165. 5:53which they'll do when someone else is
166. 5:54clicking a lot and not buying. And that
167. 5:56part actually helps you. So, switch it
168. 5:58to down only and then strip the
169. 6:00multipliers back off unless you've got a
170. 6:02specific reason for one and you're
171. 6:04watching what it does. So, now you've
172. 6:06got control over the bid that you set
173. 6:08instead of letting Amazon decide your
174. 6:10bid for you. Everything so far has been
175. 6:12about spending less in the wrong places.
176. 6:15This step is about spending more in the
177. 6:17right ones and it's the part that many
178. 6:19people forget. So, you want to go back
179. 6:21to those campaigns with an a cost below
180. 6:23your target. Those are profitable. So
181. 6:26you want to raise the budgets on them.
182. 6:28If a campaign is beating your target and
183. 6:30it's hitting its budget ceiling every
184. 6:32day, that ceiling is actually costing
185. 6:34you sales. Then you want to zoom out to
186. 6:37the product level using the notes you
187. 6:39made in step one. Some of your products
188. 6:41run at a low a cost and some run high.
189. 6:44So you can shift the money, take the
190. 6:46spend off the SKs that have been running
191. 6:48expensive and push it towards the ones
192. 6:50that convert profitably. This is the
193. 6:52part that made the biggest difference on
194. 6:54the account I mentioned. Not just fixing
195. 6:56individual campaigns, but moving the
196. 6:58budget across the product so that the
197. 7:01money was sitting where it actually
198. 7:02worked. And I'll be straight with you,
199. 7:04this is the point where it stops being a
200. 7:06checklist and starts being a job.
201. 7:08Deciding how much to move and when
202. 7:11across the product catalog and on what
203. 7:13schedule. This is what my agency does
204. 7:15all day. The accounts that hold a low a
205. 7:17cost long-term are the ones where
206. 7:19somebody's making these calls every
207. 7:21single day. If you'd rather have us run
208. 7:23it than run it yourself, there's a link
209. 7:25in the description. Either way, keep
210. 7:27watching because there's one more step
211. 7:29and it's the one that stops the problem
212. 7:31from coming back. Don't do this one on
213. 7:33the same day. Once you've changed your
214. 7:35bids and budgets, the campaigns need a
215. 7:37few days at the new levels before the
216. 7:39data means anything. Change everything
217. 7:41at once and you'll have no idea what did
218. 7:44what. So give it a few days and then
219. 7:46pull your search term report. Filter to
220. 7:48one skew at a time and build a pivot
221. 7:50table on customer search term so that
222. 7:52you can see every term that your
223. 7:54customers actually typed in along with
224. 7:56the performance data next to it. So
225. 7:58you're hunting for two things. Terms
226. 8:00that have a pile of clicks and no sales
227. 8:03and the terms with real spend that have
228. 8:05barely any sales. So a very high a cost
229. 8:08before you choose any search terms to
230. 8:10negate. That's what we're going to be
231. 8:12doing here. We want to do a relevancy
232. 8:14check. If a term is genuinely central to
233. 8:16your product, you don't want it gone
234. 8:18just because it had a bad couple of
235. 8:20weeks. You're trying to cut irrelevant
236. 8:22traffic while your main keywords keep
237. 8:24running. And for the threshold, do the
238. 8:27math instead of guessing. So, you want
239. 8:29to take your product price, multiply it
240. 8:31by your target a cost. That's what you
241. 8:33can afford to spend before you need to
242. 8:35make a sale. Then, give a search term
243. 8:37two or three times that amount before
244. 8:39you decide to cut it. So, if it's spent
245. 8:40that much and it's never converted, you
246. 8:42want to make it a negative exact. And
247. 8:44that's what I would recommend for search
248. 8:46terms that are less relevant. So, do
249. 8:48that pass and you're going to stop
250. 8:50paying for the same bad traffic next
251. 8:52month. So, back to Megan. She'd been
252. 8:54with another agency for a full year and
253. 8:56her a cost was high enough that the
254. 8:58business wasn't making any money, wasn't
255. 9:00making any profit on Amazon. And there
256. 9:02was nothing wrong with her products or
257. 9:04the listing. It's just the account had
258. 9:06been left to run itself basically. So
259. 9:08when we went through this exact
260. 9:10sequence, we set the target a cost per
261. 9:12product. We sorted it by spend. We cut
262. 9:15the budgets and the bids far enough to
263. 9:17actually bite. We took the bidding
264. 9:19settings back and then we move the money
265. 9:21towards the products that were actually
266. 9:22converting. Inside the first month, her
267. 9:24a cost came down from 60% to 45 and her
268. 9:28tacos went from 25% to 15. After a year
269. 9:32of nothing, the business was profitable
270. 9:34again. And I want to be honest about
271. 9:36this one because this part matters. Part
272. 9:38of it came from something bigger than
273. 9:40these six steps, which was restructuring
274. 9:42her account. So, we had proper control
275. 9:45over where every dollar went. But that's
276. 9:47a heavier job, and it's not just a
277. 9:49checklist that you run on a Tuesday. But
278. 9:52look at what those six steps actually
279. 9:53were. You set a real target instead of
280. 9:56guessing at one. You cut deep enough for
281. 9:58the cut to land. You turned off a
282. 10:00setting that was letting Amazon multiply
283. 10:02your bids. and you move the money
284. 10:04towards the products that work. None of
285. 10:06that's especially clever. It's just
286. 10:08control. Every one of those six steps is
287. 10:11a decision you had handed to Amazon and
288. 10:13now you've taken it back. Now, if you
289. 10:15want the version of this that holds, the
290. 10:18structure underneath the account is what
291. 10:20does it. One keyword per campaign. So,
292. 10:22when something works, you can put money
293. 10:24behind that one thing instead of the
294. 10:27whole pile of keywords it's sitting in.
295. 10:29I walk through exactly how I built that
296. 10:31in this video here. So go watch that one