Fourth Quarter is the biggest selling time of the year for most sellers. To be successful, advertising needs to play a very important role in the overall success in Fourth Quarter. One of the largest advertising avenues for Amazon Merchants is Amazon’s Sponsored Products, but just like the competition on the Marketplace, Sponsored Product competition is also more intense in Q4. You need to have a refined strategy to help you compete through the end of the year.
“There’s a lot of companies that only advertise during the holidays. So if you’ve become accustomed to seeing certain ad competition on the site, that’s gonna change come the holidays,” says former Amazonian Mike Ziegler.
Mike worked on the Sponsored Products Team at Amazon where he oversaw all aspects as how sellers use Sponsored Products. Now Mike runs a company called Marketplace Clicks where he helps sellers and vendors run effective Sponsored Product campaigns.
You want to break the holidays into several two week periods. Each period, your campaigns should be performing better than the previous period. The periods are broken into two-week time frames. The first, is the first two weeks of November. Then campaigns should improve for the second half of November and improve again for the first two weeks in December. Then the final period is the last couple weeks leading into Christmas.
If your campaigns aren’t improving, you need to make changes. At the start of November, check your campaigns weekly, as the Holidays get closer, you want to check in daily or every other day. The biggest change you want to make for the holidays is update your budgets.
That advice is not what Amazon suggests. Instead, Mike says to keep the same campaigns you’ve used all year with slight changes.
“Because we’ve put so much time into campaigns, we’re going to leverage that hard work so that these campaigns can do exceptionally well during the holidays,” says Mike, “What we do do in preparation for Q4 is we will be increasing budgets, so expect more money to be spent as the number of shoppers on the site, the number of clicks to your ads increase potentially quite dramatically.”
There’s a lot more traffic that’s going to be coming to Amazon during the holidays. As a natural byproduct, you’re going to have higher conversion rates and lower ACoS or Advertising Cost of Sales.
“You should see a little bit better in October and November and hopefully a lot better come December,” Mike says.
If you don’t start seeing a lower ACoS, then something might be wrong with your campaign, you’ll want to really dive into that and figure out what’s happening.
Now because you’re seeing a lower ACoS, you should be able to easily raise your budget because campaigns perform better than they normally do during the rest of the year.
The biggest mistake sellers can make with Sponsored Products during the holidays is around the budget. If you don’t adjust your budget, your campaign could run out really early in the day and miss a big chunk of shopping time.
“If you set a campaign budget let’s say of a hundred dollars and your campaign runs out of budget at lets say Noon Pacific Time and you know that Amazon resets that budget to resume again at Midnight Pacific Time, you’ve got 12 hours without your campaign running,” says Mike, “Now during the holidays instead of your campaign running out at noon, it may run out at 7 am, so if you’re not increasing your budget then you’re forgoing a significant amount of the daily search traffic that’s available on Amazon.”
If you don’t increase your budget and you do run out early, you’re missing out on peak times when shoppers are more likely to convert to a sale. Also, there’s less ad competition later in the day.
“I let everyone else battle it out with high bids, they run out of budget early in the day and then we can take advantage of hopefully take advantage of some lower bids and less competition by us having a higher budget during the course of the day,” Mike says.
Now you can go in and manually turn off and on campaigns to take advantage of less competitive ad times but that’s going to get tedious.
From now until Black Friday, you should see this ramp up in sales. Then once Black Friday hits, you’re going to want to check campaigns every day to make sure they’re performing the way you want them to.
Keep in mind, if you’ve been selling on Amazon for a couple years, this holiday isn’t going to be the same as last when it comes to Sponsored Product performance, simply because there’s more competition on the Marketplace.
Now, there is one caveat to this whole holiday strategy and that is if you have a giftable item, toys or something seasonal.
“They perform completely different during the holidays then they do the entire rest of the year, so because of that, we’re going to create a set of shadow campaigns,” Mike says.
For example, if you sell a baby doll, some of your typical keywords might be:
“Baby doll with accessories”
Or “doll with hair”
When it comes to Christmas campaigns, new keywords might be:
“Christmas present for two year old”
“Christmas gift for kid”
“Gifts under 10 dollars”
So you’re adding in keywords that you normally wouldn’t be using. As soon as December 24 hits, all these new keywords are going to stop working, so the holiday campaigns will be turned off.
If you’re not sure if your product falls into a gifting category, look at your sales from last year. If a high majority of sales are happening during Christmas, then you sell a highly giftable item. You’ll want to create a new campaign strictly for the holidays. If you have several dozen products that fall into this category though, you may not want to create new campaigns for all of them. Instead, choose which products you want to create holiday campaigns for.
Thanks to Mike Ziegler for joining us and giving us his Holiday Sponsored Product strategy. If you’d like Mike’s help you can find him at www.marketplaceclicks.com