Having a clear understanding of your goals on the account, campaign and product level, will inform you of which performance metrics to track and provide actionable insights on the levers to pull to help you achieve success.
What are Advertising Goals?
Your advertising goals should be reflective of where your products are in their lifecycle and your long term business goals.
Generally used for new products, brands or campaigns, with the goal of increasing exposure. Traditionally a time of high spend and initial marketing investment, you aim to place your ads in front of as many shoppers as possible to build awareness, generate reviews and drive traffic.
Time on Amazon: 0-6 months
Metrics to Watch: Increase in impressions, spend, clicks
Opportunity Cost: High ACoS
Teika Terms: Aggressive Launch and Launch
Once you have driven sufficient traffic to your page and started to convert them to sales, your product has likely shifted from launch to growth. This means your focus will shift to generating sales volume and improving sales rank. While ACoS may start decreasing, your focus will likely be on topline revenue.
Time on Amazon: 6-12 months
Metrics to Watch: Increase in Sales, CTR; Decline in Spend, ACoS
Opportunity Cost: Slim margins
Teika Terms: Increase sales
Once your campaigns and products mature and/or you have achieved desired sales volume/sales rank, you can focus on driving incremental revenue for your best-selling products at the most efficient spend. You can measure success by evaluating your ACoS and seeing whether it meets industry averages and is profitable. In this stage you typically have a high volume of sales data and brand recognition, thus your cost for acquiring a sale is much lower. Consider reducing your willingness to spend (MACS) to reflect a sustainable margin or profit.
Time on Amazon: 12+ months
Metrics to Watch: Decline in ACoS, Spend
Opportunity Cost: Reduced visibility, decline in sales
If a product is underperforming on sales, oftentimes sellers will decide to increase their advertising spending on the product in order to reduce FBA costs and sell through inventory. This may mean you will take a loss on sales or sell at cost, but it will also open up capital to invest in more profitable opportunities.