Organic Sales vs PPC Sales - Can good PPC Campaigns increase TACOS? Advanced Amazon PPC Strategies
In today's fast-paced e-commerce world, Amazon PPC (Pay-Per-Click) campaigns have become a crucial tool for sellers to drive traffic and boost sales. However, a high dependence on PPC can sometimes backfire, affecting your organic sales and ultimately your TACOS (Total Advertising Cost of Sales). In this blog post, we'll dive into the importance of finding the right balance between PPC and organic sales and provide solutions to optimize your Amazon business.
Understanding PPC Dependence
Before we delve into the solutions, let's first understand what PPC dependence is and how it can impact your business. PPC dependence refers to the degree to which your sales are reliant on paid advertising. To assess this, you can use Amazon's Seller Central to examine your PPC dependence percentages. If you find that the majority of your sales are coming from PPC campaigns, it might be time to make some adjustments.
A healthy balance typically sees PPC and organic sales roughly evenly split, around 50-50. If your PPC dependence is too high, say 80% or more, it's a red flag, especially if your product has been on the market for some time. It's important to address this issue because an imbalanced PPC dependence can lead to higher TACOS and decreased organic sales.
Identifying the Problem
Suppose you're running well-optimized PPC campaigns, targeting the right keywords, and maintaining low ACoS (Advertising Cost of Sales). In that case, it can be frustrating when your TACOS remains high. The problem might lie in how much PPC you're running, especially if you're in a market with lower demand, like Canada or Australia.
In these smaller markets, your PPC campaigns might be running all day, causing a decrease in organic sales. To counteract this, you can decrease your PPC dependence by examining your campaign types. Sponsored products are essential for ranking, but you may not need sponsored display or sponsored brand campaigns. Consider pausing or reducing the budget for these campaigns to allow organic sales to shine through.
Analyzing Keyword Rankings and Conversion Rates
Another crucial aspect of reducing PPC dependence is evaluating your keyword rankings, conversion rates, and ACOS campaigns. If your dependence is higher than desired, it's time to investigate if there's an issue with your product listings. Ensure that your product listings are optimized and that there are no glaring problems that could hinder organic sales.
Suppose you've exhausted all other possibilities and your listing is in perfect condition. In that case, high PPC dependence might still be the culprit. Try gradually decreasing your PPC budget while keeping sponsored product campaigns running to see how it affect your organic sales. The goal is to bring your PPC dependence down to around 50%, which is where you can start stabilizing your TACOS and improving your profitability.
Seeking Solutions with Data
It's essential to approach the issue of high PPC dependence strategically. There is no one-size-fits-all solution, as different marketplaces and products have unique challenges. To make informed decisions, utilize tools like Scale Insights to gather and analyze data about your campaigns and sales performance.
If you're not already using Scale Insights, consider trying their 30-day free trial with a 10% off lifetime discount. This tool can provide valuable insights to help you make data-driven decisions and optimize your Amazon business effectively.
Get Professional Help
If you find yourself struggling with high PPC dependence and TACOS, don't hesitate to seek professional help. Many agencies and experts specialize in Amazon PPC and can conduct a thorough audit of your campaigns to identify issues and offer solutions. Whether it's keyword optimization, campaign management, or listing improvements, their expertise can make a significant difference in your Amazon business.
Conclusion
Balancing Amazon PPC and organic sales is a constant challenge for sellers, but it's a critical one. A high PPC dependence can lead to inflated TACOS, hurting your profitability. By analyzing your campaigns, keyword rankings, and conversion rates, you can find the right balance and optimize your Amazon business for success. Remember that each marketplace and product is unique, so adapt the solutions to your specific situation, and consider seeking professional help when needed. Ultimately, a balanced approach will lead to healthier TACoS and more profitable Amazon sales.
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