MACS enables bid automation in Flywheel. We automatically calculate bids that align with your advertising strategy and publish them directly to in Amazon, so you don't have to. Setting the correct starting MACS is easier said than done, thankfully Campaign Creator does this for you!
What is MACS?
MACS is an input that communicates the bidder your willingness to spend based on your product margins and advertising goals. The bidder will use this information to determine the optimal bid for your keywords (manual campaign) and ad groups (auto campaign) to help you achieve your advertising strategy.
How do we calculate MACS?
Campaign Creator will make recommendations for your ad group level MACS. Since we house 1 product per group, setting MACS at the ad group will provide you with more accurate bids, more control over the algorithm, and faster keyword exploration.
The MACS target we suggest for each ad group is dependent on 3 key inputs:
- Pre-Ad Gross Margin: Indicates how much room you have to spend on advertising after factoring in COGS, Amazon Selling Fees, and FBA Fees.
- Product Goal: Launch, Growth, Profit
- Audience Segment (Target): Brand, Competitor, Category/Generic
We will calculate the MACS target using the following equation:
Base (Pre-Ad GM) x Goal Modifier x Audience Modifier
We use modifiers that reflect audience and goal bc often spend amount varies based for these segments
Each goal and audience segment has a specific modifier percentage thats reflective of the typical spend patterns. For example:
If the product goal is launch, and the campaign targets competitor keywords, the modifiers will be higher, operating under the assumption that we should more to acquire the sale.
If the product goal is profit, and the campaign targets brand keywords, the modifiers will be lower, operating under the assumption that we should spend less to acquire the sale.
How do we calculate MACS without COGS?
COGS (cost of goods sold) data is used to calculate your pre-ad gross margins for each product. Without COGS, we're still able to provide a MACS recommendation, however it is not as accurate.
If you're unable to provide COGS, we will calculate Pre-Ad Gross Margins by:
- If SKUs are running in existing campaigns, we use the average MACS target of campaign(s) or ad group(s) as a proxy for pre-ad gross margin.
- If the SKU is not currently being advertised or is running in campaigns no enabled MACS, we will default to 20% pre-ad gross margin.
Does the MACS Calculator follow the same logic as the Campaign Creator?
No. The MACS calculator recommendations are less advanced than the Campaign Creator. As a result, you will likely see discrepancies in recommendations.
Next: Campaign Creator: How are Budgets Calculated?