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here’s some content about the difference between offering a high bid versus focusing on improving CVR (Conversion Rate):
When it comes to running a successful pay-per-click (PPC) advertising campaign, there are two primary strategies that advertisers can use: offering a high bid or focusing on improving their conversion rate (CVR).
Offering a high bid means that an advertiser is willing to pay more per click in order to secure a higher ad position on the search engine results page (SERP). While this strategy can be effective in driving more clicks to a website, it can also be costly and result in lower ROI (Return on Investment).
On the other hand, focusing on improving CVR means that an advertiser is focused on optimizing their landing page and website in order to increase the likelihood of converting visitors into customers. By improving the user experience and addressing any pain points or barriers to conversion, an advertiser can improve their CVR and get more value out of their existing traffic.
While both strategies can be effective, there are some key differences between the two. Offering a high bid can result in more traffic to a website, but it may not necessarily result in more conversions. Improving CVR, on the other hand, can help an advertiser get more value out of their existing traffic and result in a higher ROI.
In addition, offering a high bid can be costly and may not be sustainable over the long term. By focusing on improving CVR, an advertiser can achieve a more sustainable and cost-effective advertising strategy that generates consistent results over time.
Ultimately, the decision between offering a high bid versus focusing on improving CVR will depend on the advertiser’s goals and budget. However, it’s important to consider the potential benefits and drawbacks of each strategy in order to make an informed decision that will drive the best possible results for the business.
Offer high BID vs CVR improvement
Do you have a problem getting exposures for the product?
The best way to check if it’s a BID problem is to check and see if your BID is 50% lower than the offer offered by Amazon. Yes, I know the BID offered by Amazon is only a recommendation, but it’s also a great indicator to know the competitiveness in the same category .
What do you do when the reduction of the BID does nothing more than significantly reduce the exposures and sales?
This is a scenario I see more and more of with beginning traders.
Take this scenario –
BID of $2
Selling price of a product of $30
30 clicks / 3 orders =
Spending $60
Sales of $90
Which equates to an ACoS of 67%.
So how do you optimize?
Well, normally we would lower the BID.
But suppose the BID is cut in half, so theoretically we should see an ACoS of 33%.
But instead, you see a significant drop in sales and a higher ACoS from limited data.
(10-15 clicks per keyword and limited sales)
So what went wrong with us?
Well, Amazon is getting more and more competitive.
So such a low offer usually won’t get us good positions.
That means we win positions only when our competitors have finished their advertising budget!
So, if that’s the case, how do we download ACoS?
1. Managing the BID – we lower the BID and simply accept the fact that 0 sales are preferable to unprofitable sales – mistake!
2. We are improving the CVR – the long-term solution to this problem – right!
Improving the conversion rate is the real answer here!
First, improving the conversion rate is at the heart of what Amazon wants to see.
They want to show the products that customers are likely to buy!
So what exactly does the same equation look like with an improved CVR?
$2 bid
A $30 product
30 clicks / 5 orders =
Spending $60
Sales of $150
Which is equal to 40% ACoS.
Improving the CVR on this keyword from 10% to 16% caused a 27% drop in ACoS.
Again, this is a learning example.
I want to present how CVR can improve ACoS.
The BID changes, and the CVR at the keyword levels changes.
But, merchants don’t always see the sync between their CVR and their ACoS.
And that’s what I’m trying to show here.
So what steps should we take due to this –
1. CVR analysis on our top keywords for sales before making a decision on the BID price.
2. Pay attention to Brand Metrics to make sure our CVR is healthy relative to our category.
3. Understanding that a low BID will not always give us a lower ACoS.
