Controlling ACoS while Selling in Supplement Category

2. Controlling ACoS while
selling in supplement
category

3. Follow these easy 9 steps…
Break-even ACOS=( COGS / Selling Price)×100
In this simplified formula:
COGS is your Cost of Goods Sold.
Selling Price is the price at which you sell your
product.
This formula assumes that all other costs are
covered in the COGS and that your desired
profit margin is 0%. It provides a quick
estimate of the maximum ACOS you can
afford without incurring a loss.
1. Know your break-even ACoS.
Break-even ACOS =
(Advertising Spend / Break-even Revenue
per Sale)×100
The break-even ACOS is the ACOS at which
your advertising spend is equal to the
profit generated from the sales.

4. Follow these easy 9 steps…
2. Capitalize on your best SKUs
Recognize which SKUs from your catalog
are top performers and bring in the most
sales and profit. Advertising all variations
under one parent might help you take
over more ad placements in search results,
but it is only sometimes the most
profitable. Capitalize on best-selling SKUs
and advertise on them.
3. Set a higher campaign budget and
start controlling spend with lower bids
Start campaigns with higher budgets and
with lower bids. Amazon will take this as
you are ready to spend on your product
and push it in front of customers. With
lower bids, you might not always win top
of search placements, but sometimes,
being lower in the search results may lead
to customers with higher intent to buy.

5. Follow these easy 9 steps…
4. Analyze the effectiveness of your
current targets
Have different match types separated in
different ad groups - keyword and product
match types work differently, and it is
easier to see the difference and impact of
each match type if you separate them.
Analyze the performance of your targets
and try to recognize targets that bring in
sales - those will be your stars leading to
sales with low ACoS.
5. Pause targets that overspend but
bring no sales
While analyzing the bulk file, pay attention
to targets bringing your profits down.
Consider pausing targets with a lot of
clicks that are not generating sales. There
might be a time in the future when they
will perform better, but if they are only
increasing spend while you are trying to
keep ACoS under control, consider
pausing them.

6. Follow these easy 9 steps…
6. Utilize negative match
Take time, at least once a month, to
analyze search terms in your discovery
campaigns - with automatic targeting,
broad and phrase match, and expanded
product targeting. Negate everything that
gets lots of clicks but no sales. Those will
drive spending up, as will your ACoS in the
last instance. An easy way to do so can be
to schedule a Search term report to
regularly pop up in your inbox directly
from your advertising console for both
Sponsored Products and Sponsored
Brands.
7. Optimizing targets over break-even
Don't shut down all targets above
break-even ACoS. It could be a bad week.
Always keep testing. Sort your targets into
different brackets. For those only slightly
above break-even ACoS, 10% or 20% above,
depending on your profit flexibility - set
bids just below CPCs for a couple of cents.
Come back next week, and if performance
doesn't improve, continue decreasing or
consider pausing. On others that are way
higher than break-even ACoS, set bids
even lower than that first bracket of
targets. And come back next week to
check it. Repeat.

7. Follow these easy 9 steps…
8. Bet on high-performing targets
Take advantage of your star targets, those
mentioned in step 4. Keep bidding above
CPC to ensure you win ad placements on
targets with the most ad sales. But don't
go too crazy. Find the sweet spot. If you bid
too high, your spending will increase, but
you will get the same sales. Increase it
gradually in search of that sweet spot.
9. Adjust bids by placements to your
advantage
At last, remember to adjust your bids by
placements. Amazon recently introduced
the option to adjust bids for the rest of the
search placements inside the advertising
console. Different placements work
differently across various campaigns and
targets; take notice to analyze it. You can
do so in that bulk file you downloaded in
step 4 or inside campaigns in the
advertising console.

8. Unpopular opinion: When high ACoS doesn't
matter
Know your product and your
audience. If you have a seasonal
product, keeping your spending at a
certain level is beneficial to save
listings and BSR by keeping traffic
live on them, usually at higher ACoS.
However, protecting your BSR in the
low season will lead to higher profits
during the busier season and pay out
your earnings loss.

9. Questions, comments,
experiences?