5 Tips to Lower Your Amazon ACoS

Amazon provides a wide range of data points to help vendors optimize their marketing strategies. While all marketing metrics can be informative in the right context, average cost of sale (ACoS) is one of the most important stats for Amazon vendors to track.

ACoS represents how much you spend on each sale. For example, spending $200 to generate $1,000 in sales would lead to an ACoS of 20%. Lower ACoS values indicate more efficient campaigns. In this article, we’ll cover five of the most effective ways for vendors to reduce their Amazon ACoS.

Tip #1: Leverage Keyword Research Tools

Every niche has certain top keywords, and the brands that appear in the first few results will perform significantly better than the rest. Identifying and optimizing for critical keywords is one of the most reliable ways to minimize your ACoS.

How can you lower your Amazon ACoS through keyword research? 

Amazon vendors can choose from numerous tools to streamline keyword research. Popular third-party keyword research tools such as Cerebro – Reverse ASIN research tool by Helium 10 can help lower your ACoS. You can start optimizing product pages to improve your search engine visibility once you’ve identified the top keywords.

Related: Amazon Keyword Targeting

Tip #2: Optimize Your Listing Titles

Search engine optimization is important throughout each listing, but it’s particularly relevant for product titles. The title is the first thing buyers see when viewing your product, and it’s crucial to make a good first impression.

What are best practices for Amazon product titles?

• Try to eliminate extraneous words to make the title more concise. 
• You should also include any critical information, such as specs or model numbers, that customers would want to know before clicking on the product.
• Ensure that your titles meet the 200 character limit.
• Avoid using terms like “free shipping,” “100% satisfaction guarantee,” and other similar marketing language.

Tip #3: Improve Your Bidding Strategy

Strong bidding strategies are key to long-term success in Amazon advertising, but finding the perfect bid isn’t always straightforward. Paying too much for poor keywords can be inefficient. On the other hand, it’s sometimes better to outspend the competition for the most important keywords.

An improved bidding strategy must leverage things like:

• Dynamic bidding. Amazon’s dynamic bidding settings give you control over bid flexibility in each campaign based on Amazon’s analysis. Setting bids to dynamic down lets Amazon reduce bids as needed, but prevents them from going over your set bid. Up and down dynamic bidding adds the option to go up to 100% higher for first-page results and 50% for all other results. 
• Fixed bidding. This strategy ensures that your default bid will be applied in every context. You should use this option if you want to exercise more control over your keyword bidding strategy.

Related: Amazon Bidding Strategies

Tip #4: Implement Negative Keywords

Just as targeting the top keywords will reduce your ACos, avoiding the worst keywords will have the same effect. Spending money on views that are unlikely to lead to sales will negatively impact any campaign.

You will need to identify negative keywords if you want to improve your ACoS. These keywords are common in a wide range of fields, and they’re heavily dependent on context. 

If you’re listing iPhone cases, for example, you’ll want to avoid spending money on ads for searches that include “Samsung” or “Google.” Keyword research is incredibly useful in identifying both positive and negative keywords.

Related: Negative Keyword Targeting

Tip #5: Do Effective Competitor Research

Consistently auditing your own strategies will go a long way toward improving your ACoS, but you should also keep an eye on any competitors. Researching leaders in your field will help you identify their advantages and find ways to start making up ground.

We recommend analyzing the competition and doing the following:

• See what information you can gather from your competitor’s listings. This information will show you what terms they are bidding on, how they are structuring their titles, and more.
• Check what images they are using. Image quality is an important—but often overlooked part of listing optimization. Customers make purchases based on the information displayed on Amazon, so even minor cosmetic disadvantages can be tough to overcome.
• Analyze reviews. Reviews can provide a lot of value about what your competitors are doing right and wrong. You may be able to use this data to improve the way you optimize your listings by highlighting key areas where your competitors are falling short.

Improve and Lower Your ACoS With RevenueWize

There’s no shortcut to an amazing ACoS, but these strategies will help you identify inefficiencies and make the necessary adjustments.

Keep in mind that optimizing your ACoS is an ongoing process—consistent attention to detail is the best way to stay ahead of the competition.

Start your free trial of RevenueWize to see how you can improve your ACoS and become a better Amazon seller!