How to Make Use of Amazon PPC Advertising to Improve Sales
In this series, I’m going to show you how to accurately estimate your Amazon PPC expenses using a simple and quick trick known as the 2.5 rule. The 2.5 rule is nothing more than a rule of thumb, which is essentially a quick way to guesstimate your expenses for any PPC campaign you’re conducting. This rule won’t only help you accurately predict what your future Amazon PPC sales will be, it’ll also give you a big advantage over your competitors and potentially even double your sales. By the time you’re done reading this article, you’ll know why using this rule is important and how to use it to your advantage with your PPC campaigns.
So what’s the 2.5 rule? The 2.5 rule is this: If you want to make money from PPC advertising you have to figure out what your target audience wants to buy before you start spending any money on PPC advertising. If you target a group that has a high sales price, you don’t want to run PPC ads until you see that your target audience has a low sales price. You’ve basically figured out your target price. Now all you need to do is run targeted ads at that price and make sure that people click through them.
To calculate your target audience’s interests, you simply divide your target audience’s age, gender, location and primary language by the number of PPC clicks you plan to conduct. For instance, if you’re planning to target ads to people aged 35 and up, your conversion rate on each individual PPC ad would be roughly 1.35%. If your clicks only produced 1 single sale per 10 clicks, then your conversion rate would be pretty low.
Let’s break down what we found into a more tangible format. We’ve found that PPC ads with an average sales price of $40 tend to bring in more conversions than ads with a lower price. (This difference is actually greater than we originally thought.) Therefore, if your goal is to earn a higher commission on every single PPC ad that you run, it would behoove you to choose a PPC ad with an average sales price that is lower than your highest bid.
Once you’ve determined your highest bid, you need to identify your target acos. To do this, you need to divide your total sales price by the number of clicks your ad runs. The number of clicks will determine your target acos. Your target cost is basically the number of people who will purchase your product after clicking your ad from Amazon.
After you have your targeted ads, you need to know how many clicks will get you one sale. This number will help you calculate your commission pay out. To get the most out of Amazon’s PPC advertising, it is best to aim for a conversion rate of about 10%. This means that you should focus on ads with the lowest possible bid prices. Using an ad with a low bid price will not only benefit your own bottom line; it will also allow you to attract customers with prices that are far below your highest bid. These customers are more likely to be willing to purchase after clicking on your advertisement.
Finally, be sure that your ad has a unique title and is focused on your target market. If your title does not directly reveal what your product is about, it won’t do any good. This rule applies doubly so for negative ads. With negative ads, it is crucial that you only allow viewers to make a judgment about your product based on the title and the description provided.
When you have your PPC campaign up and running, you can start making sales. Amazon allows you to choose between pay per click and cost per thousand impressions. If you go with the former option, you will have to pay only for the number of clicks your ad produces. PPC, on the other hand, will allow you to charge for the number of sales that result from your ad. PPC can prove to be very profitable if you know how to set it up and use the right tactics to attract customers. However, it is also a great deal of work to maintain a high PPC ranking in order to increase sales.