by Stefano Starkel
Kitesurf Junky and Amazon PPC whisperer
I’ve been fortunate enough to be born with an entrepreneur mindset.
Not from a wealthy family, since young age I was always able to leverage my skills and factory/consumer price arbitrage to get some “pocket money” in order to buy what I wanted, and until now nothing has changed.
My first eCommerce success was late 1999 when I first heard about eBay in Italy. Right away I saw an opportunity, and leveraged my early english skills to import fashion “copies” from china and sell them online on eBay Italy.
eBay success allowed me to leave Italy for good in 2005 and pay for a one way Jamaica – Mexico – Australia – Asia 2 year trip that completely changed the way I look at the world and the way I live in it, and made me call Vietnam “home” for close to a decade, until 2017, when now with a wife and kid, we left it for more traveling, soul and home searching.
Amongst many enterprises I succeed and failed at in Vietnam was www.saigon2muine.com, a “bar napkin” idea I had one night (which thank God I remembered in the morning and decided to follow through).
In 2011, Saigon2MuiNe ended up to be the first online booking service for who was looking for a private car with driver to move around in south Vietnam.
As first comers, we dominated the market for about 2 years bringing in 5 figures/month net profits, purely with AdWords PPC.
I have a reptilian instinct for both numbers and systems, and that is, still today, my superpower and what I do best. Take quick decisions, and systemize the outcomes (if they are good!).
When In late 2014 heard about ASM (and selling on Amazon) and given my previous experience with both eBay and Saigon2MuiNe traffic needs, it seemed a no-brainer.
Exited all my businesses (by that time I was also part owner of a Kitescool, a Bar and an Italian Restaurant, all in Mui Ne, Vietnam!) and focused money and brain 100% on Amazon.
I soon learned that there are 4 main pillars you need to focus in order to be successful long term on Amazon:
- Product and Market research
- Keyword Research
- Listing Optimization
Now, you can argue with me that there is much more than this that need to be added to the equation. And I would agree, but everything else stands and rely on those 4 main Pillars.
As for me, after going through the ASM course, launching my product and growing the company with employees that run systems, I decided to focus where I shine: numbers and PPC
See, I fell in love (..more of a love/hate actually…) right away with the simplicity of Sponsored Products. It’s the simplest PPC platform I had ever seen. Assuming you have nailed the other 3 Pillars, you don’t need to come up with great ad copy, there is no need for testing images, there is no messing around with audiences, positioning, day parting or device targeting.
You bid on a Keyword, and you either win or lose. That’s it.
If your overall strategy is good, Amazon will tell you what to bid on and how much for, and if you listen and learn, the wins will greatly outperform the losses.
It’s like playing at the Casino an being allowed to count cards.
But how do you “count cards” with Sponsored Products?
Well, you first need…
You need to know and understand EXACTLY how Amazon PPC works, and the limits you are allowed to play within, so you need a deep knowledge of the following:
- Customer Search Terms
- Match Types
- Campaign Types
- Account Limits
A Keyword is what you are bidding on in Seller Central (or AMS).
Customer Search Terms:
A Customer Search Term is what buyers are typing inside Amazon search bar in order to find what they are looking for.
Amazon will “Match” this with one or more Keywords you are bidding on, and this brings me to the next point…
The definition of “Match” is how the Amazon PPC algorithm matches what you are bidding on (Keyword) with what buyer are searching (Customer Search Terms).
Amazon allows for 5 Match Types:
- Negative Phrase
- Negative Exact
Amazon will serve your ad only if the user types the “Exact” match for the Keyword you are bidding on.
In the image below you see the Keyword “pet treats” in EXACT match will be triggered only if the buyer types “pet treats” or “pets treats” and some other combinations which almost exactly match what you are bidding on.
Amazon will serve your ad only if the user type a “Phrase” that include the same exact Keyword you are bidding on.
In the image below you see the Keyword “pet treats” in PHRASE match will be triggered only if the buyer types “pet treats” or “pets treats” or “organic pet treats” or “pet treats with fish oil” or any other combinations which contains what you are bidding on, in the same order.
Note that “pet treats” and “treat pets” in Phrase Match will yield 2 completely different results if
Phrase Match keywords, if not negated properly, will also trigger Exact Matches.
Amazon will serve your ad pretty much for any search that include the word “pet” AND the word “treat”, does not matter the order or if they are next to each other.
Broad Match keywords, if not negated properly, will trigger also Phrase and Exact Matches.
Amazon will stop your ad from showing up for anything the “Phrase Match” would have.
Amazon will stop your ad from showing up for anything the “Exact Match” would have.
Amazon decides what Customer Search Term to show you based on previous customer behaviors, product category and listing copy.
– Auto campaigns allows you to buy specific placements that the manual can’t
– Your ad will show on search result page AND specific areas of other people listings (“Sponsored products related to this item”)
– Very little control on what Customer Search Terms you’ll show up for OR what listing you’ll show on
Allows you to tell Amazon what specific Keywords/match combinations you want to bid on
– 100% control on what you are bidding on IF you structure your campaigns properly
– Your ad will show only on search result page
A buyer searches for “pet treats”, your product ad pops up, he/she clicks on it but don’t buy.
The same buyer searches for “organic pet treats” just a minute after, your product ad pops up once more, and he/she clicks on it again, but this time adds to cart and buys.
Although you will get charged for both clicks, the conversion gets assigned to the “last click”, “organic pet treats”.
– A sale gets attributed to a click only after the product ships (about 48h after the click)
– Seller Central shows 7 day conversion window – you will register a conversion only for items that are bought within a week from the clicking
– API shows 7 and 30 days conversion window
Delta (difference) between 7 days and 30 days is about 10%
If Seller Central shows a 7 day Acos of 50%, the 30 day ACoS will be about 45%
If Seller Central shows 7 day Sales of $1000, the 30 day Sales will be about $1100
If Seller Central shows 7 day Orders of 100, the 30 day Orders will be about 110
– A sale gets attributed to a click regardless of what product in your catalog gets bought/shipped
– If the item gets refunded, the attribution gets taken!
In short: In order to have “clean” conversion data, you ALWAYS need to look at your reports skipping the previous 7 days!
Amazon sets oddly low limits on each account. Although the limits can be lifted once you reach the 2 million mark, it seems as though the Amazon API itself is not yet designed to handle more. So whatever strategy you end up using make sure you stick within the limits
The Customer Search Term report is your best friend!
It’s like having a crystal ball.
It will tell you the exact Customer Search Terms that were matched to your Keywords (for Auto, Broad and Phrase match), as well as telling you what detail page triggered a sale (ASIN, only for Auto campaigns).
The next thing you need is a…
Well, assuming that your goals as a seller is to make as much money as possible while spending the least amount of money (make profits) and putting in least amount of effort required, and you know and understand what I have just shared above, the strategy should be rather simple and clear:
Leverage your knowledge about Keywords, Customer Search Terms, Match Types, Campaign Types, Attribution and Reporting in order to build a Product | Campaign | Ad Group | Keywords system/logic that:
- Is scalable and “easy” to maintain
- Works well within the limit imposed by Amazon
- Automatically finds new, longer tail Keywords, over and over again
- Segment bidding and matches in order to have as much control as Amazon system allows us to have (I LOVE Exact match)
- Lets us bid high (buy data) while having the confidence that worst case scenario we will (eventually) break even
And finally, here is my…
For each product, I build an “ecosystem” of campaigns (which in my business we called PGN as for “Product Group Name”).
Each PGN will have an AUTO campaign, an EXACT campaign, a PHRASE campaign and a Broad campaign.
You might ask.. Why so complex? Simple:
- Having 1 Campaign/Product/Match allows you to keep your Negative Keywords centralized at the campaign level
- Having Negative Keywords at campaign level allows you to expand your ad groups under that campaign knowing that each Keyword within that campaign will “know” what not to show up for
- Naming Campaigns and ad groups so that you or your PPC manager knows what threshold to apply before taking any actionWhat worked very well in our business is: [product name or SKU]-[match]-[product sale price]-[max ACoS]. Example: “Dog Treats-PHRASE-$14.95-35%”
…Starting and running the system…
Assuming that you have nailed the other 3 pillars and you have done your market research properly and chosen good products for which you have done a thoughtful keyword research, and that you have optimized your listing based on what you know the market wants and the Keywords you know the buyers are using to buy what you are selling (and hey, will not hurt if you have 15 initial reviews), you should switch on your traffic system.
Create the 4 containers I mentioned above (AUTO, EXACT, PHRASE, BROAD) and pick the 10 keywords with the most traffic and highest relevancy, and do the following:
- Add each in each Campaign with relevant match. Each keyword should be added as EXACT in the exact campaign, ad PHRASE in the phrase campaign, and as BROAD in the broad campaign
- Each keyword should also be added as NEGATIVE EXACT in the phrase campaign and as NEGATIVE PHRASE in the broad campaign
That’s it, this is your starting point.
As for maintenance, I’d advise you to periodically (every 2 weeks is a good start) download the Customer Search Term report and use your Excel skills to do the following:
- Identify Customer Search Terms that convert within your thresholds and add them back into the system (as I explained just above)
- Identify Customer Search Terms that are not converting or with excessive spend and negate those as Negative EXACT at campaign level ONLY in the Auto, Phrase and Broad. NOT IN THE EXACT (they might register a sale in the upcoming days!)
- Pause any keyword with excessive ACoS
- Pause any keyword with excessive Spend and 0 sales
- Pause any keyword with high ACoS that has low Conversion Rate
- Re-enable any keyword with favorable ACoS
- For keywords that have been paused for a while, test a lower bid
- Keep going lower and lower until you reach your ACoS goals or you drive the bid to 0
This is as simple as it gets. A solid strategy that has worked (and still works) for me on AdWords, and that has been adapted to Amazon in order to dominate on my competition while being fairly simple to be systemized and applied by your team.
…. This in an ideal word, where everybody is sharp, loves what they do and can think and act at lightning speed!!
The bigger you grow, the more products and keywords you have, the harder will be to maintain such a precise system, and run it as often as it need to be run in order to catch up bleeding terms as soon as the bleeding happens…
I soon discovered that, when scaling, this system, although in my mind perfect, was:
- Hard to manually set up at scale
- Hard to track performance at keyword level
- Hard to keep a log of all changes made
- Hard to scale if done manually
- Extremely prone to human error (given my aggressive bid strategy)
So in August 30, 2016 we started developing an in house automation tool that would do ALL above (and much more) several times a day, without costly mistakes, and basically with just the push of a button.
After having used it for close to 2 years just within my business, we decided to open the doors to other sellers.
If what you read above all make sense to you, just go ahead and apply my proven PPC strategy to your business.