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Does My Position in Amazon Sponsored Ads Really Matter?

Posted by Sophie Williams in Articles

As an Amazon FBA business owner, you probably have numerous items on your to do list and it can be difficult to keep track of all of them, and to prioritize what is most important. However, you should realize that positioning of your Amazon sponsored ads can have significant impacts on your outcomes.

Do I Need to Spend a Lot of Time with Ads?

You should always dedicate a significant portion of your time working on your business to tracking as well as improving your Amazon sponsored ad campaign overall performance.

Identifying concerns and correcting them before the campaigns begin to suffer in terms of performance can save money as well as effort in the future from having to go back and try to fix things all over again.

The Most Common Mistakes Made with Amazon Sponsored Ads

Amazon’s algorithms can be complicated to figure out, and we’ll never truly know all of the details, but in general, these details are designed to reward products that perform well. Even one day in which you experience a low sales volume can have a negative influence on your total sales.

Your paid rank and your organic rank will suffer as a result. Always pay attention to every movement in your ranking. This means that you’ll know the indicators for when your ad is performing well. This leads to a well-performing campaign and can also assist with gaining organic positions for your promoted listings.

What Ad Strategy Should You Be Using?

The sophisticated algorithm used to determine Amazon sponsored ads is unlikely to be figured out on your first attempt.

Even if you have some prior experience running campaigns on different types of advertising platforms, there are so many moving parts that it’s hard to figure out which of the pieces is most important. Most people assume that if they run campaigns before in Google Ads, then they can transfer the same experience over to Amazon sponsored ads. Sadly, this is not the case.

What Makes Google Ads Different From Amazon?

Google Ads are designed to take traffic from various trap channels to optimize these based on the goals that you identify, such as viewing a key page, drawing in a lead, or making a purchase. However, Amazon’s algorithm specifically targets ads that make Amazon more money, which is a totally different approach altogether.

Your campaign performance for Amazon sponsored ads will only be as effective as you are at managing your overall performance. The biggest mistake that most people make with sponsored ads is to focus solely on ACoS. You have to know the break-even point, including your product’s cost per click conversion rate and the maximum amount of money you are willing to spend to acquire a customer. Then you can generate the maximum cost per click that you can afford to pay while still remaining profitable. Other elements that should be included in your consideration are the listings’ current conversion rate, your max CPA, and the cost of the goods sold, including Amazon fees in any of your manufacturing cost.

The keywords that you are currently targeting might not be the best performing, which means that you need to come back and tweak these in the future. If you’re going to dedicate time to any one thing in your Amazon business, it should be sponsored ads and leveraging these to be as effective as possible.

Having a clear system for addressing these issues and being able to pass on your system to a buyer when it’s time to sell your company, can be instrumental in making the process that much easier and in leading to a better sale price of your company overall.