How To Drive Incremental Sales on Amazon – We Found The Missing Link
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This document discusses how to measure the incremental impact and return on ad spend (ROAS) of Amazon search ads by accounting for the effect on organic sales. It recommends splitting campaigns by search intent, mapping visibility through heat maps, and calculating incremental ROAS based on paid sales from ads versus organic sales with and without accounting for ranking improvements from ads. Budget and sales scenarios are presented showing how ROAS can be improved through more advertising spend.
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How To Drive Incremental Sales on Amazon – We Found The Missing Link
- 2. TODAY WE’LL SOLVE ONE OF THE BIGGEST ADVERTISING QUESTIONS
- 3. WHAT IMPACT DO MY ADS HAVE ON MY ORGANIC SALES?
- 4. BEFORE WE START - A FEW PROBLEMS WITH ATTRIBUTION AND KPI’S RIGHT NOW: - LAST CLICK ATTRIBUTION - BRAND HALO EFFECTS - LOOK-BACK WINDOW - DIFFERENT ATTRIBUTION SB/SP+SELLER/VENDOR
- 5. New Customer Acquisition Strategies In-Market Targeting Similarities ASIN Targeting Broader Keyword Targeting Keyword Conquesting ASIN Retargeting Targeted KeywordsSEARCH DSP AWARENESS CONSIDERATION PURCHASE AND OF COURSE DIFFERENT STAGE IN THE FUNNEL = DIFFERENT CONVERSION RATE
- 6. SO AN OVERALL ROAS/ACOS GOAL DOESN’T WORK!!
- 7. SPONSORED ADS Performance 2020 vs. same time period 2019
- 10. FIRST STEP SPLIT YOUR CAMPAIGNS BY SEARCH INTENT:
- 11. EXAMPLE OF A CAMPAIGN STRUCTURE Fineliners Category Sponsored Products Sponsored Brand Products Display Ads Auto Keywords Generic keywords Competitors ASIN’s Generic keywords Defensive keywords Portfolio ASIN’s Defensive keywords Competitors keywords Target groups Competitors keywords Similar categories fineliner, fine pens intensity fineliner, bic fineliner arteza fineliner, staedtler fineliner Fineliners Pens, Pencils & Writing Supplies Category targeting Product targeting
- 12. Brand Keywords Generic Keywords Competitor Keywords Out-of-Category Keywords Incremental Impact ROAS Level (Paid) High Medium Low Very Low Ranking Improvement Low High Low Very Low Strategy • Protect Brand • Increase of carts sizes • Brand Building • Cross- / Upselling • Product Launch • Increase Sales (long-term) • Push Organic Rankings • Gain visibility in the search process • Gain Market Share • Target products by USPs • New Customer Acquisition • Attract new Customer Groups • Increase Sales • Promote discounts IMPACT ON INCREMENTAL SALES
- 13. BUT HOW HIGH IS THE IMPACT?
- 14. IF YOUR NOT VISIBLE YOU WON’T SELL
- 15. HIGHER LISTING POSITION = BETTER CTR = MORE CLICKS = MORE SALES Top-List-Position Top-CTR = Top-Sales
- 16. MAP YOUR VISIBILITY HEAT MAP 16 Brand 2: 17,32% Brand 3: 3,3% Own brand: 76,44% Own brand 90,24% Brand 2 5,83% Brand 3 1,10% Own brand 90,24 % Brand 2 5,83% Brand 3 1,10% Own brand 90,24 % Brand 2 5,83% Brand 3 1,10% How often do customers see our products per search result placement? How often do our competitors appear? Own brand 90,24 % Brand 2 5,83% Brand 3 1,10% Shares per placement Largest competitors
- 17. MAP YOUR VISIBILITY HEAT MAP 17 Brand 2: 17,32% Brand 3: 3,3% Own brand: 76,44% Own brand 90,24% Brand 2 5,83% Brand 3 1,10% Own brand 90,24 % Brand 2 5,83% Brand 3 1,10% Own brand 90,24 % Brand 2 5,83% Brand 3 1,10% How often do customers see our products per search result placement? How often do our competitors appear? Own brand 90,24 % Brand 2 5,83% Brand 3 1,10% Shares per placement Largest competitors Own brand 90,24% Brand 2 5,83% Brand 3 1,10% Own brand 90,24 % Brand 2 5,83% Brand 3 1,10% Own brand 90,24 % Brand 2 5,83% Brand 3 1,10% Own brand 90,24 % Brand 2 5,83% Brand 3 1,10% Shares per placement Largest competitors
- 18. MAP SALES → IF YOU DON’T HAVE ACCESS TO TOOLS FOR THAT USE BRAND ANALYTICS DATA AND COMBINE IT WITH YOUR SALES 18 5k Sales 1k Sales3k Sales 0,7k Sales 3k Sales 0,8k Sales2k Sales 0,5k Sales
- 19. FIRST LEVEL INCREMENTAL: PAID SALES ON THE KEYWORD - ORGANIC SALES ON THE KEYWORD = INCREMENTAL AD SALES
- 20. BRANDED KEYWORD: ROAS 10 * AD INCREMENTAL FACTOR 0.1 = aIROAS 1 GENERIC KEYWORD: ROAS 3 * AD INCREMENTAL FACTOR 0.8 = aIROAS 2.4
- 21. 21 AGGREGATE DATA TO GET YOUR INCREMENTAL FACTOR
- 22. EXAMPLE: RESULTS SPONSORED PRODUCT ADS Search results 1-4 DEFENSIVE GENERIC 22 22
- 23. HOW CAN I JUMP POSITIONS TO MAKE MORE ORGANIC SALES? 23 5k Sales 1k Sales3k Sales 0,7k Sales 3k Sales 0,8k Sales2k Sales 0,5k Sales
- 24. SIMPLIFIED RANKING FORMULA: eCTR x eCR (Sales) x CATEGORY x MARGIN VIEWS AMAZON (Smaller factors and weighting left out to make it easier readable)
- 25. SIMPLIFIED RANKING FORMULA: eCTR x eCR (Sales) x CATEGORY x MARGIN VIEWS AMAZON (Smaller factors and weighting left out to make it easier readable)
- 27. MASTER LEVEL INCREMENTAL: PAID SALES ON THE KEYWORD - ORGANIC SALES ON THE KEYWORD + ORGANIC SALES DUE TO RANKING IMPROVEMENT = INCREMENTAL SALES WOHHOOO :)
- 28. BRANDED KEYWORD: ROAS 10 * AD INCREMENTAL FACTOR 0.1 * ORGANIC INCREMENTAL FACTOR 1.15 = IROAS 1.15 GENERIC KEYWORD: ROAS 3 * AD INCREMENTAL FACTOR 0.8 * ORGANIC INCREMENTAL FACTOR 2 = IROAS 4.8
- 29. BUDGETS AND SALES SCENARIO OVERVIEW
- 30. SALES/BUDGET SZENARIOS Current Plan Szenario 1 Szenario 2 Szenario 3 SALES / YEAR Budget: 1.150.000€ Budget: 1.248.000€ Budget: 2.238.000€ Budget: 3.952.000€ ROAS
- 31. SZENARIO 01 - 35.000.000€ SPONSORED ADS, DSP & ORGANIC SALES (QUARTERLY) KEY TAKEAWAYS - 25% Growth through advertising - Investment in Q3 & Q4 higher due to Primeday and Cyberweek but also better ROAS (Retail deals)
- 32. CRAZY LEVEL: REAL TIME BID ADJUSTMENT BASED ON ORGANIC RANKING → LET’S TALK ;)
- 33. NOW YOU! MAP YOUR VISIBILITY CALCULATE YOUR IROAS KEEP IT SIMPLE HAVE FUN!
- 34. I’M ONE OF 130 INTERNATIONAL AMAZON EXPERTS AND LOVE WHAT I DO :)