Although the budget in the process of setting up in-site advertising is Daily Budget, which literally means "daily budget", in fact, Amazon calculates the expenses on a monthly basis when verifying and deducting fees.
Many sellers may have such a misunderstanding about Amazon’s in-site advertising daily budget. The daily budget for in-site advertising is set at $30.00, but it is actually increased to $40.00. Why is this?
Although the budget in the process of setting up in-site advertising is Daily Budget, which literally means "daily budget", in fact, Amazon calculates the expenses on a monthly basis when verifying and deducting fees.
Assuming that the advertising month has 30 days and you set a daily budget of $30.00, the system will assume by default that your budget for the month is $900.00. Then, under such calculation, the actual advertising deductions on a certain day may exceed $30.00, but the total amount for the month will not exceed the upper limit of $900.00.
With this understanding, there is a reasonable explanation for why the ads being run exceed the advertising budget on a certain day.
The reason for such fluctuations is mainly due to the non-instantaneous nature of Amazon's system updates. When a listing is advertised, once the ad space is determined, the system will not immediately remove it from the shelves the moment the advertising budget for the day is exhausted. Slow system updates will result in clicks still being generated after the advertising budget is overspent. Therefore, based on this, Amazon flexibly adjusts the daily budget deduction method.
For sellers, they should consider other dimensions of daily budget.
1. When placing advertisements, the daily budget cannot be too small
Generally speaking, the daily budget should be more than 20 times the single bid. At the same time, try to ensure that the ad is online for more than 16 hours. In an advertising plan, whether the daily budget is too small resulting in too few clicks, or the ad display time is too short, it is not conducive to the overall performance of the ad.
2. The daily budget is not fixed and should be adjusted according to sales conditions
If the conversion rate of an advertising plan is cost-effective, ACOS is less than the gross profit margin, and the daily advertising budget is always exhausted, in this case, the seller can appropriately increase the daily budget to bring more exposure, clicks and orders. When an advertising plan is not cost-effective in the long term, the seller can also gradually reduce the advertising bid and daily budget.
3. In order to make the daily budget of advertising more reasonable and spend it on effective clicks, sellers can adjust the advertising bidding by time period
Lower your bid during non-peak sales periods, and appropriately increase your bid during peak sales periods to reduce advertising waste and bring ad clicks closer to real consumers.
4. It is not recommended to promote multiple listings in the same ad group at the same time. Focus on the key points of advertising.
The best approach is to promote one product through one advertising plan. If multiple listings have been added to the same ad group, sellers must analyze their own ad data reports. For listings and keywords with poor conversion rates, they can be removed from the ad plan to make the ad more focused, thereby achieving the goal of bringing more conversions and orders with the same budget. The better the conversion, the higher the ad weights, keyword quality scores, etc., thereby achieving better ad effects while keeping the budget unchanged.
