Automatic for the people
While some advertisers and sellers like to manage their sponsored product ads campaigns manually -setting their own bids for each product or keyword and selecting the keywords and the products – there are many others that prefer automatic campaigns where they don’t need to do much in order to promote their products.
Our data scientists collected data from 40,000 campaigns (that were running in the last month on several ecommerce sites) and analyzed the contribution of these campaigns to the stores’ advertising revenue and reached some very interesting and important conclusions.
Automatic campaigns
There can be several levels of automatic campaigns as the automation can relate to one or more of these elements:
(1)The bids – Our Sponsored Product Ads platform enables advertisers to select their own max bid (per product or keyword) or to select automatic bidding. In this case they choose their target ACOS (advertising cost of sale) and the bidding is done automatically in real time trying to reach their desired ACoS.
(2) The keywords – The advertiser can manually select their target keywords or select automatic keywords and in that case the keywords are selected automatically based on the promoted products.
(3) The products – The advertisers can manually choose which products they want to promote or select autonomous campaigns where the algorithm will select several products that have the highest chance to perform.
Advertising revenue
Let’s start with the bottom line – between 50% to 90% of the revenue that the stores generated from sponsored product ads in the analyzed campaigns derived from automatic bidding campaigns.
Of the 40,000 campaigns that were analyzed, 60%-90% were in fact automatic bidding campaigns.
The advertisers and the marketplace sellers, especially the small ones, preferred to run automatic campaigns and avoid the hassle of the manual bidding and monitoring of their campaigns.
The average CPC of the automatic bidding campaigns was 17% higher than the average CPC of the manual bidding campaigns, and the average CTR of the automatic bidding campaign was 10% higher than the CTR of the manual bidding campaigns (although in some stores it was lower).
These 2 factors (higher CPC and higher CTR), together with the advertisers’ demand for automatic & easy to manage campaigns, are responsible for the increase in the store’s advertising revenue from the automatic campaigns.
If automatic bidding is important then automatic keywords is a must – Between 75% to 90% of the revenue that the stores generated from sponsored product ads (in the analyzed campaigns) derived from campaigns with automatic keywords.
Between 78% to 92% of the revenue came from campaigns that had either automatic bidding, automatic keywords, or both.
The importance of the automatic option
The automatic campaigns are responsible for a very big share of the stores’ advertising revenue.
If the stores hadn’t offered automatic bidding campaigns, some of the advertisers and sellers would probably have run manual bidding campaigns, but many of them would simply pass on the opportunity, and the store would have lost a lot of potential ad revenue.
Same goes with the automatic keywords option.
Also as mentioned the automatic campaigns generated higher ad revenue for the stores, thanks to their higher CPC’s and CTR’s.
Offering these automatic options to the advertisers and sellers, especially when there are smaller advertisers and marketplace sellers, is crucial to the revenue the store can generate from sponsored product ads.
And what about automatic product selection?
You will have to follow our blog to find out.
About Mabaya
Mabaya offers a white-label self-service Sponsored Products Ads platform for online retailers and marketplaces that enables sellers and brands to bid in order to ensure their products are listed in premium locations in the online store.
The platform is integrated in more than 50 ecommerce sites around the globes, serving more than 50,000 advertisers and sellers.
