I’ve been an FBA seller for many years. During a product launch, I usually set the PPC budget to $10/day. Sales usually take off. If the Acos is profitable, I increase the PPC daily budget. If Acos is not profitable, I leave it as is, never increased the daily budget. The products would sell well for 2-3 years and start to decline. I have many that decline and never regain to their glory days. People call it “Product life cycle”. My theory is that Amazon purposely create this so call “Product life cycle” to make ways for new sellers/new products. Why? Because new products need to spend more on PPC than established products. It doesn’t make sense that new similar products and price with almost no reviews could out sell the established products that has thousands of reviews, even after the honeymoon period is over.
Below is what Amazon PPC has been recommending me to increase the daily budget to $70. I’ve had it at $10 since the beginning (around 2018). In the last few weeks the sales have dropped dramatically (about 90%). So quick and so severe. So I just up it to $30 to see what would happen.
I wonder whether you guys follow Amazon PPC daily budge recommendation? If you did, did you see the decline in sales? If you did not, did your products part of the “Product life cycle”? Please share your thoughts and experiences. Thanks.
We do not follow their recommendations. Recently, we have seen a spike in clicks that haven’t translated into sells. That tells us that they are playing with the algorithm again.
As far as the up and down sells, it seems that this started with the reverification process and the other quiet little changes that have been done to the code on the site recently. It’s happen before and we normally just wait until the dust settles before we try to adjust anything.
Ranks for main kw - “stapler” which is a very low Search Frequency Rank (SFR) kw. You can try competing with it and people are advertising against it but look at the review, rank and rating - doesn’t have Amazon Choice (AC) but does have Best Seller Badge.
As you can see there are slight variations in each stapler whether it is feature or quantity variation and is dominated by two brands. Amazonbasics and Swingline (which is a very old - household name as far as staplers go).
You will only see swingline sponsoring their listings and Deli further down, another brand using SB - Video with the same kw - again with a feature variation. They are not using Sponsored Products campaigns - this is smart and probably a low cost relative to a sponsored product campaign.
Now in order to compete with them you would have to have a convertible variation, build up your listing to match the competition and spend a ton showing up on top - with those numbers you are looking at upwards of half a million to a million over the course of 2 years - with no guarantees that you will succeed.
I am skipping quite a few things for the sake of brevity but this is just a high level discussion over one kw with at least 10 different points of discussion on the actual offer alone - not to mention everything else like the price point, sourcing, branding, etc.
And this, Dorothy, is where we leave Kansas and enter the world of the hundreds of variables for amazon.
You can’t simply go with anything amazon says without assessing all these unsaid variables and keeping them in front of you. If you do, you will lose money. Simple and they will send another stupid recommendation your way.
Amazon and those that work there really only start and end recommendations based on spend alone and nothing else. Literally nothing. They will say, if you spend x, you will increase your chances of increasing revenue by y, but why would one do that without a basic ROI analysis? And who will do that? They certainly can’t. They have no clue if you paid $5 or $500 for your $20 item. This is why everything they say is just pure marketing and meeting their quotas and isn’t designed to aid you in any real sense. This is why there are specialist consultants, companies and software in this space - which also market with the sole intent of selling a service.
I know not the answer you’re looking for, but the one you need right now.
I have no proof, but I suspect that their bots are trained to learn from our behavior and adapt so as to extract as much money from us as possible. That is, if they learn that you follow their recommendations, they will continue to raise the amount recommended.
When I started, I followed their recommendations, until the recommendations got ridiculously high for what I was selling. I mean, when the product is selling for $8 and the bid recommendation was $1…
So, I cut the bids down to 10 cents. Then, the recommendations fell in line with that and were 20 cents.
Personally, when sales are sluggish, I work on adjusting the targets, not the amount of the bids or budgets.
That is because their suggestions are entirely muted to % increase from where your current max bids are set. They can’t make suggestions based on real time market data on cpc which can vary from day to day and time of day as well. Just a minor point.
I’ve been seeing this as well, but we have lowered our bids and budgets. I think it has a lot to do with the times right now, people are holding onto their money and not buying like crazy as we saw during Covid. A lot of window shopping and “lipstick sales”
