Many Amazon sellers struggle with high Advertising Cost of Sales (ACOS) during new product launches. The common mistake? Immediately targeting highly competitive keywords with aggressive ad spending, often leading to disappointing results. What's the underlying logic behind this phenomenon, and how can sellers adjust their strategies for more efficient ad campaigns that lower ACOS and improve profitability?
The Pitfall of Premature Keyword Targeting
In Amazon's competitive marketplace, launching new products resembles sailing against the current - progress requires careful navigation. Many sellers rush to launch ads immediately after listing new products, hoping to quickly capture market share. However, targeting highly competitive broad keywords from the outset often leads to high spending with minimal returns. This approach is akin to a toddler attempting a 100-meter sprint - the outcome is predictable.
Automatic Campaigns: The Foundation for Smart Keyword Selection
The strategic approach begins with automatic campaigns. These serve as "scouts" that test the effectiveness of keywords in your product listing while identifying high-traffic, high-click-through, and high-conversion terms. These proven keywords become your product's "winning terms" - the most cost-effective choices for targeted advertising. After running automatic campaigns, sellers gain clear insights about which keywords genuinely drive sales versus those that merely drain budgets.
Manual Campaigns: Precision Targeting for Ranking Improvement
Once automatic campaigns identify high-performing keywords, sellers should transfer these to manual campaigns. Manual campaigns function like "snipers," precisely targeting potential customers to quickly improve organic rankings for these keywords. As organic traffic grows, sellers can gradually reduce ad bids and budgets while maintaining control over campaign performance.
The Ongoing Value of Automatic Campaigns
Should sellers turn off automatic campaigns after transferring successful keywords to manual campaigns? Absolutely not. Automatic campaigns continue providing unique value by continuously discovering new, low-bid, high-conversion keywords. They match products with additional traffic streams, connect with potential customers, and cover broader search avenues. Notably, after launching manual campaigns, automatic campaigns often show decreased Cost Per Click (CPC) alongside improved conversion rates - creating a sustainable "traffic reservoir" of cost-effective visitors.
The Low-Bid, High-Conversion Strategy
By systematically reducing bids and budgets in automatic campaigns, many sellers discover they can maintain strong conversion rates even with bids as low as $0.20 and minimal daily budgets. Numerous sellers have verified this strategy's effectiveness. Automatic ad placements can maintain 24/7 visibility on Amazon's first page, significantly increasing product exposure. More visibility generates more clicks, which in turn creates more conversion opportunities - the ultimate goal of any Amazon seller.
Synergistic Campaign Management
Manual and automatic campaigns complement rather than compete with each other. While manual campaigns quickly boost keyword rankings, automatic campaigns maintain consistent conversions at lower costs while uncovering valuable long-tail keywords with excellent conversion rates. This combination creates a powerful traffic engine for sustained product growth.
The Danger of Prematurely Closing Automatic Campaigns
Sellers who disable automatic campaigns after launching manual ones often experience declining performance - reduced traffic, fewer orders, and lower rankings. This occurs because they underestimate automatic campaigns' continuous value, particularly when product listings maintain strong relevance. The solution involves reactivating automatic campaigns with appropriately adjusted bids, then gradually optimizing as organic traffic improves.
Divergent Approaches to Product Launches
Amazon sellers employ markedly different launch strategies. Some successfully reach top rankings using just one or two campaign groups with minimal bids and budgets, while others launch dozens of high-budget campaigns with poor conversion results. The latter group often blames product quality rather than recognizing deficiencies in their operational strategies and technical skills.
Precision Operations: The Key to Success
Successful Amazon selling requires meticulous campaign management. Sellers must thoroughly understand Amazon's advertising algorithms, including keyword selection, bid strategies, and budget control techniques. Continuous learning and practical experience help develop customized operational methodologies that outperform competitors in this intense marketplace.
Relevance: Optimizing Automatic Campaign Performance
Listing relevance significantly impacts automatic campaign effectiveness. When product titles, descriptions, and bullet points closely align with targeted keywords, automatic campaigns more efficiently match with qualified traffic, improving conversion rates. Therefore, sellers must prioritize keyword optimization and relevance when creating product listings.
Successful Amazon product launches require patience and strategy. Avoid immediately targeting expensive broad keywords. Instead, leverage automatic campaigns to identify high-performing keywords, then use manual campaigns for precision targeting. Maintain automatic campaigns to continuously discover new traffic opportunities. Only through refined operational techniques can sellers achieve lasting success in Amazon's competitive marketplace.