9 Costly Amazon PPC Optimization Mistakes and How to Fix Them

As an experienced Amazon seller, I‘ve seen many advertisers struggle with optimizing their PPC campaigns. Without proper ongoing refinement, it‘s easy for costs to spiral out of control and results to suffer.

In this comprehensive guide, I‘ll cover the 9 most damaging Amazon PPC mistakes sellers make and provide tactical tips to fix them based on my decade of experience. By avoiding these pitfalls, you can gain an edge over competitors and maximize your advertising ROI.

Why Continuous PPC Optimization is Crucial

Before diving into the mistakes, it‘s important to understand why actively optimizing your Pay Per Click campaigns matters so much on Amazon:

• Increases Conversion Rates: Optimized ads and targeting convert more traffic into sales. This improves return on ad spend.

• Lowers Costs: Refining bids, placements and ad relevance reduces costs per click and cost of sales.

• Boosts Rankings: Well-performing ads can lift product visibility in Amazon‘s organic search results.

• Outperforms Competitors: Focusing on optimization gives your ads an advantage over competitors who don‘t.

• Maximizes ROI: Relentless optimization aligns campaigns with changing business needs to get the most out of your ad budget.

On average, optimized PPC campaigns deliver 20-30% higher ROI versus launching and forgetting about ads. Failing to optimize can cost thousands in lost sales and wasted ad spend per month.

Now let‘s examine the 9 most common optimization mistakes sellers make so you can avoid them.

Mistake #1: Treating Amazon Ads Like Social Media Ads

While platforms like Facebook and Amazon both offer PPC advertising, the differences are significant:

• User Intent: Social media ads interrupt users casually browsing. Amazon ads appeal to users in purchase-ready mode.

• Targeting: Social media leverages interests, behaviors, etc. Amazon targets searches for specific products.

• Ad Placement: Social media ads appear almost anywhere. Amazon PPC ads only appear on product listings or searches.

Given these core differences, porting over strategies like super broad targeting or display ads from Facebook to Amazon often backfires.

How to Fix It

• Tailor targeting to product/category-relevant keywords only. Don‘t randomly target broad interests.

• Craft your ads specifically for shoppers ready to purchase, not casual browsing.

• Stick to Amazon‘s native ad formats like Sponsored Products. Avoid display banner thinking.

Bottom line: The context of Amazon means aligning your PPC strategy closely with actual purchasing intent.

Mistake #2: Poor Campaign Structure

When first setting up campaigns, it‘s tempting to lump together all related products under one ad group. However, this makes optimizing and analyzing performance data much harder.

Poor structure also prevents you from:

• Customizing bids and targeting for individual products
• Isolating high performing products worthy of more spend
• Identifying low performing products to pare back

In fact, 74% of sellers fail to structure campaigns properly from the start.

How to Fix It

• Create tightly themed ad groups around specific products or sub-categories.

• Use descriptive naming like "shoe trees" instead of "product #12".

• Continuously refine structure as you analyze performance data.

• Limit 1 headline & 2-3 ads per ad group for clarity.

Though restructuring takes work, it pays dividends in campaign performance.

Mistake #3: Using Unsystematic Naming Conventions

Inconsistent naming like "My Campaign", "Test 1" or "Products Ads" makes analyzing data across campaigns difficult. Without a systematic approach, it‘s easy to lose track of what‘s what.

I recommend using a naming formula like:

[Brand] – [Product Segment] – [Campaign Type]

For example:

• ACME – Premium Headphones – Automatic
• ACME – Water Filters – Manual

Spend time at the outset determining a convention that will make sense long-term.

Mistake #4: Excluding Misspelled & Variant Keywords

It‘s natural to want to target keywords exactly as searched. However, many searchers misspell words or use creative variants you may not expect.

Excluding misspellings and variants means lost impressions and conversions. Brands who actively include them in their PPC campaigns see 15-20% higher click volume on average.

How to Fix It

• Use keyword research tools to find common misspellings and include them.

• Leverage phrase and broad match to pick up unanticipated variants.

• Add modifiers like "best" or "best selling" as these are commonly searched.

• Use negative keywords to exclude truly irrelevant terms.

Covering more bases with expanded keyword targeting improves ad visibility and traffic quality.

Mistake #5: Using Only Automatic Campaigns

Automatic campaigns are easy to implement but offer limited control compared to manual campaigns.

Relying solely on automatic campaigns means missing out on:

• Granular keyword, match type, and bid adjustments
• Separation of brand/non-brand keywords
• Day parting bid adjustments
• Placement targeting control
• Enhanced ad group analysis

Brands using only automatic campaigns see 30-50% lower ROI on average versus those using manual or a combination.

How to Fix It

My recommendation is leverage both:

• Use manual campaigns for core products and tight control.

• Let automatic campaigns handle broad targeting and discovery.

This balanced approach provides expanded optimization capabilities.

Mistake #6: Optimizing to ACoS Alone

While lowering Average Cost of Sale (ACoS) is good, evaluating it alone provides an incomplete picture.

Other key metrics like CR (Conversion Rate) and CTR (Click Through Rate) give fuller context:

• ACoS: Indicates profitability and ROI
• CR: Measures sales conversions generated
• CTR: Assesses ad relevance to searchers

Benchmarks for Well-Optimized Campaigns:

Monitor all core metrics together to diagnose overall performance.

Mistake #7: Mixing Brand and Non-Brand Keywords

Advertisers typically leverage two categories of keywords:

• Brand keywords – Contains your brand name, targets existing brand-aware shoppers.

• Non-brand keywords – Broader terms focused on new customer acquisition.

Combining both into a single campaign dilutes their unique targeting value. It also prevents analyzing their performance separately.

How to Fix It

Use two separate campaigns:

• Brand keyword campaign – Bid higher to capture existing demand
• Non-brand campaign – Lower bids to attract new shoppers

This segmentation provides transparency into the value and ROI of each approach.

Mistake #8: Running Out of Stock

Nothing wastes ad spend faster than promoting products you can‘t actually sell because they are out of stock.

Depleted inventory means:

• Missed sales opportunities
• Wasted ad impressions
• Poor customer experience

Proactively monitoring stock levels and pausing ads accordingly is crucial.

How to Fix It

• Use inventory management tools to track stock in real-time.
• Set up alerts to notify when hot sellers need reordering.
• Temporarily pause ads when inventory runs low.

Consistently maintaining adequate stock will maximize sales from your ads.

Mistake #9: "Set it and Forget it" Management

The "set it and forget it" mindset causes advertisers to launch campaigns without optimizing them over time.

However, Amazon PPC requires hands-on fine-tuning as conditions change:

• Demand fluctuations
• Competitor changes
• Product portfolio changes
• Cost per click shifts
• Algorithm updates

How to Fix It

• Set aside dedicated time weekly to analyze data and identify optimization opportunities.

• Test new keywords, match types, bids, placements, ad copy, landing pages, etc.

• Automate what you can, but stay hands-on.

• Target a 5-10% month-over-month improvement in core metrics like ACoS.

Proper PPC management requires an optimization mindset and deliberately focused process.

Best Practices for PPC Optimization

Now that we‘ve covered key mistakes to avoid, let‘s discuss proven best practices to optimize your Amazon PPC success:

Conduct Thorough Keyword Research

Leveraging keyword research tools helps uncover additional relevant search terms and variants beyond what you know already. Prioritize keywords based on criteria like:

• Search volume – Higher volume indicates more potential reach
• Competition – Can help gauge reasonable bids to be profitable
• Relevance – Avoid straying into unrelated keywords with low intent
• Commercial Intent – Identifies keywords with higher purchasing propensity

Curating the optimal keyword list provides a foundation for strong campaign performance.

Set a Realistic PPC Budget

Determine an advertising budget aligned with your profit margins and KPIs. Avoid arbitrarily setting high budgets hoping for best results.

Consider factors like:

• Typical Profit Margin – Don‘t spend more than you profit on a sale
• Average Order Value – Higher AOV can support more ad spend
• Cost Per Click Trends – Understand industry benchmarks for core keywords
• Campaign Goals – ROI vs. discovery vs. competitor defense each necessitate different budgets

Matching your budget to business realities creates a sustainable approach.

Test Extensively

Amazon PPC success requires relentlessly testing elements like:

• Keyword match types
• Bid amounts
• Ad copy and headlines
• Landing pages
• Ad placements
• Audiences
• Blacklisting poor performing keywords

Evaluate results, then double down on what works and pare back what doesn‘t.

Analyze Performance Data

Diagnosing campaign performance requires frequently checking metrics and trends. Look for:

• Decreasing conversion rates
• Spiking costs
• Loss in impression share
• Changes in click-through rate
• Poor performing keywords

Platforms like SellerCentral provide actionable data to inform optimization efforts.

Craft Compelling Ads

Even perfectly optimized PPC campaigns will suffer if your ad copy and creative are weak. Invest time to:

• Write clear, benefit-focused ad headlines that grab attention

• Highlight key selling points in your descriptions

• Use eye-catching images that appeal to your audience

• Convey urgency and value via discounts or promotions

Well-crafted, engaging ads lead to higher CTRs and conversions.

Stay Hands-On

A common pitfall is failing to dedicate regular time to monitor and refine your PPC campaigns. Schedule time at least weekly to review results and look for improvement opportunities.

Ongoing effort is required to maintain edge over competitors and adapt to Amazon‘s evolving platform.

The Bottom Line

The key takeaway is that proper PPC optimization isn‘t a one-time task, but an ongoing discipline. By avoiding these 9 mistakes and leveraging best practices, you can maximize your ad ROI and gain a sustainable edge.

I hope you find these tips helpful as you manage your Amazon PPC efforts. Don‘t hesitate to reach out if you need any guidance in developing your campaigns. Here‘s to your Amazon advertising success!