Amazon CPC Optimization: Product and Category Targeting Strategies

February 15, 2021
Written by Jayce Broda
amazon cpc

One of the PPC (Pay-Per-Click) ad metrics that you should be continually monitoring is Amazon CPC. What is Amazon CPC? The CPC stands for "cost-per-click," which is the fee Amazon charges you every time a visitor clicks on your ad. As a rule of thumb, the lower an ad's CPC, the better. 

However, it seems impossible nowadays to keep Amazon CPC lower due to the Amazon marketplace's highly saturated market. This is where product and category targeting can be useful. It allows you to fight directly with your competitors, right at the pages of their product listings.

What is product targeting?

Product targeting, also known as ASIN targeting, allows you to display your Amazon sponsored ads based on the targeted ASIN. It is available for both sponsored display and sponsored products, according to the Amazon Advertising blog.

In the sponsored display, you can create a custom headline and logo, which enhances your ad's visuals. It appears on search results pages, the right side of product detail pages, and beside customer reviews.

On the other hand, sponsored product ads appear at the bottom of a listing or categories, specifically, under the label "Sponsored products related to this item." You can also find it within the shopping results pages.

Techniques to employ for Amazon product targeting

Fine-tune your Amazon sponsored ads management by applying the product targeting tips below:

Go after top-performing ASINs

Is this like Goliath vs. David? Not really. Chances are, you can easily infiltrate and compete with products that buyers mostly search for or sellers they usually purchase from, because it means shoppers can also see your product offerings as they browse your competitor's product detail page.

But how can you find these high-converting ASINs? You can get them from the search terms report, specifically, under the "customer search term" column when converting it to Excel or a spreadsheet document. 

Search for low-performing ASINs 

Prevent your ads from showing at underperforming competitor product listings, which is also called "Negative ASINs." These are the products that are new in the marketplace or with low sales or popularity.

Again, you can find it in the search terms report, so make sure you are running automated PPC campaigns beforehand. In Amazon Seller Central, the negative targeting feature has a section where you can add Negative ASINs.

Moreover, it saves more of your Amazon CPC bid money and lowers your ACoS because it keeps you from spending on clicks that will never convert.

Target your products

Huh? Why should I compete with myself?

Don't worry because this will never be the case when you are targeting your ASINs. Conversely, it helps you upsell your products and prevents your competitors from landing on your product listings if they target your ASINs. 

Target ASINs that you can outperform

In business, you have to be ruthless and cunning, even if it means you need to take down ASINs that give you a competitive advantage. In the search terms reports, filter the ASINs with the following criteria:

  • Products with a higher price than you
  • ASINs with lower ratings
  • Products with a fewer number of reviews

Utilize data from Amazon Brand Analytics reports

It is not only the search terms report you should give attention to. You may also gather ASINs from the Market Basket Analysis report and Item Comparison Report.

In the Market Basket Analysis report, you can find the products purchased together with yours. Thus the term "market basket." Try targeting these again to replicate the scenario also, but this time, your ad will be displayed in the "Sponsored products related to this item" section. 

On the contrary, the Item Comparison report shows the ASINs that were bought instead of yours. By doing this, you are giving yourself a second chance to sell your product against the ASINs which outperform you.

However, you need to be a member of the Amazon Brand Registry to be able to do this. 

What is category targeting?

With this feature, you can target brands and categories where your products belong or are related to. Similar to product targeting, you can refine the categories you want to target by star reviews, price, brand, and Prime shipping eligibility.

Strategies to use for Amazon category targeting

Go after competitor brands

Search and target competitor brands with high traffic or views. In this way, you will have a chance to be seen alongside the most popular categories related to your brand. How to get brands or products with many views? In the search terms report, filter the clicks and click-through-rate (CTR) columns from highest to lowest.

You can also target categories that complement yours. For example, if you are selling sportswear, you can target it with the category which offers gym equipment or energy drinks.

Compete with products you can excel at

Since you can filter category targeting by price, ratings, and reviews, better take advantage of it. Get those products with low customer reviews and ratings or high price ranges.

Which targeting type optimizes Amazon CPC?

If your goal is to lower or optimize your Amazon CPC, then better choose ASIN targeting. Why? Let us put it this way. What is the best way to beat a couple of opponents? Is it one at a time, or all at once, even though you are fighting on your own? In ASIN targeting, you can closely monitor your competitor and check if your ad is working or not. This is impossible with category targeting because you are against several listings.

As explained by Smart Insights, "If you're in an oversaturated market, it might be difficult to get any impressions with this new ad type due to high CPC. But if you're in a less congested category, the scale is easily achievable -- and possibly with better performance." For instance, you are selling disposable diapers, so your category is under Baby > Diapering. Instead of targeting the Diapering category that has 5000 results, why not choose the Disposable Diapers category that only yielded 452 results? Try this approach, and you will ace Amazon paid ads management when it comes to category targeting.

Keep in mind that there is a possibility that you don't only have three or five competitors. It could be a hundred or more, depending on how saturated your market is. We've emphasized that ASIN targeting is more effective than category targeting. It will help you a lot if you hire an Amazon ad agency to handle your Amazon sponsored ads management needs. Creating, monitoring, and optimizing your PPC campaigns is not a one-time thing. It would help if you had a dedicated team to handle it, and the best way to do this is by outsourcing it.

In closing

We will not tell you to pick your poison. Instead, it would be better to try both product and category targeting to help you reach a more relevant audience and drive more sales. Moreover, it lowers Amazon CPC because now you can display sponsored ads with utmost precision.

Seller Interactive has a team of experienced consultants that can help you optimize your Amazon CPC and manage your PPC campaigns depending on your business needs. Please email us at [email protected] or [email protected] today.

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