How To Set a Budget for Your Amazon Ad Campaign

How To Set a Budget for Your Amazon Ad Campaign

Amazon is a platform designed to allow sellers to take control of their own sales. The competition is fierce, but the results can be astounding with the right strategies. The way Amazon works is distinct from Google. Google ads and organic results are varied and uniquely measured, but with Amazon, ad performance lends to a product’s organic results. The influence of Amazon advertisements makes running an ad campaign on the platform all the more vital to success.

One of the main problems many vendors run into is wondering how to set a budget for their Amazon ad campaigns.

Consider the Type of Product

Different products require different levels of aggression in advertising. Some keywords are more costly than others, depending on how much competition there is for those terms. Here are a few top considerations when you’re thinking about your product and how it affects the ad spend:

  • New products may need a higher budget than established products to establish product awareness.
  • Products with lots of competition within the platform need a more aggressive strategy than products without fierce competition or a vast market.

How well-established your product and brand are affects the results of ad campaigns on Amazon because the campaign may show strained results at first as the product gains a following. Patience is vital with newer products.

Reevaluate the Budget Based on Performance

The most important thing to do for your Amazon ad campaign is to continuously reevaluate the budget you’re using based on performance metrics. For example, suppose you’re spending $20 a day, a safe amount that won’t affect your account’s overall return but that propel sales. However, each day the ads stop serving by noon. In that case, the return may look positive, but you most likely need to increase your budget. Amazon ads are pay-per-click, so if customers are clicking through your entire budget early in the day, you’re missing opportunities on afternoon and late-night sales.

If you see these types of results, raise your budget by 15 percent and wait two weeks as a test period to see if your results increase.

Ditch Automatic Keyword Targeting

Automatic keyword targeting is simple but not always useful. Automatic keyword targets can lead to some bad or cheap traffic that won’t convert as well as a targeted keyword could. Be wary of relying solely on automatic keyword targeting, and invest in your campaign to develop accurate and exact keyword targets. This allows you to put more money in your budget per day because you’ll have the peace of mind knowing you’re hitting high-conversion potential traffic.

You can do many things to increase the value of the budget of your Amazon ad campaign. Not all ad spend is equal. Using your resources and best judgment with the help of professional Amazon advertising services can set you up to find the most success with the right budget. Contact Logical Position today to learn more about how to set a budget for your Amazon ad campaign and for a free consultation.

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