To analyze advertising data specifically, we can start with the following parameters: ACoS, conversion rate, and click-through rate.
What is ACoS?
ACoS = total advertising expenditure / total sales value. If your ACoS is 30% and your total sales are $100, then your total advertising expenditure is $30, which means that every time you pay $30 in advertising fees, you will get $100 in sales.
It is understood that the average ACoS of Amazon sellers is 34.42%. Understanding our current ACoS value is crucial for the next bidding optimization and optimization of advertising keywords and ad groups.
1. How to calculate ACoS?
CPC (Cost-per-click), charges per click. Total advertising cost = bid * number of clicks
ACoS = advertising fee / sales generated by advertising = (bid price * number of clicks) / (average order value * sales volume)
2. How to reduce the ACoS value?
1) Increase prices appropriately
If the ACoS value is too high, the value of advertising investment is high. Our goal is to be lower than the average. Generally speaking, 10%-20% is normal. From the above formula, we can know that if we want to lower ACoS, we can increase the price, but the price also has a weight. As the price increases, the weight will also change, which will lead to changes in the traffic ranking of other factors, and the final ACoS will not necessarily become smaller, so don't blindly increase the price.
2) Optimize keyword advertising
Optimize the keywords in the ad group, analyze the exposure, conversion, and click data in the ad report, and filter out competitive keywords based on the situation.
3) Improve QS
The higher the ad weight means your bid is not high, and you will also get a relatively high ad ranking. Ad weight is related to conversion, and conversion is related to QS. The three are directly proportional. The higher the QS, the higher the ad weight. Having a high-weight ad will also reduce our advertising costs, which is the core of ACoS.
4) Conversion rate
Conversion rate is = number of converted clicks / total number of clicks. Even if there is exposure and clicks, without conversion rate, there will be no sales and no orders. The ranking and weight of the product will also be affected.
It is understood that the average conversion rate is 9.47%. If your advertising conversion rate is lower than the average, you need to carefully analyze the factors that caused it.
3. Factors that affect conversion rate include:
1) Five points, description, A+ page
High-quality listing copy not only attracts buyers, but also allows them to browse the products, dispel their doubts, and place orders quickly. Especially the header image, which is the first step to attract buyers to click in.
2) Product reviews and ratings
It is known that most buyers judge the quality of products by browsing review records before placing an order. If the reviews and scores of products are not high, it is difficult to convert. In order to improve the conversion rate, it is necessary to dilute the negative reviews through evaluation or fake orders to increase the product score.
3) Price
Reasonable prices can give consumers a sense of “getting a bargain” and value for money, and ultimately help them place an order. If you want to increase conversion rates, reasonable prices can help you gain more favor from buyers.
4) Delivery method
For some buyers, it takes more than ten days to receive the goods, which is unbearable. Amazon delivery has many advantages over self-delivery, and buyers will also take the delivery method into consideration when placing an order.
5) Click-through rate
Click-through rate = total number of clicks/total number of impressions.
It can be seen that the average click-through rate is 0.36%. We should set a click-through rate greater than 0.36% as the target. A click-through rate lower than the average means that your product is displayed in front of buyers but fails to attract buyers to click in. This means that you need to further optimize your listing, improve the quality of the listing, or optimize the keywords of the ad to increase exposure and clicks.
4. Factors that affect click-through rate include:
1) Main image
The main picture is the "appearance". High-quality pictures attract sellers to click. If you want to increase the click-through rate, then improve the "appearance" of the listing!
2) Title
The title has a very high weight. An excellent title will bring a very good experience to buyers. It should be concise and clear, with a clear distinction between the main and the secondary.
3) Number of reviews and star rating
Too few reviews and a low star rating can easily give buyers a bad impression of the product, which can also affect the conversion rate. If you want to improve your competitiveness and get more clicks, optimize the product reviews!
4) Price
As mentioned above, it not only affects the conversion rate, but also the click-through rate. For the same product, the product with a more advantageous price may immediately get the click of the buyer.
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