This episode explores the problem of "death by a thousand cuts" in Amazon advertising, a phenomenon where numerous low-visibility keywords cumulatively lead to significant wasted ad spend. Against this backdrop, the hosts discuss how over-harvesting keywords contributes to this issue, illustrating the problem with an extreme example of a hypothetical account with 100,000 exact match keywords. More significantly, they detail a method for identifying this problem by comparing average clicks to conversion and average target CPC, filtering keywords with fewer clicks than the average and bids exceeding the average target CPC. For instance, they demonstrate this process using a client's data in AdLabs, showing how identifying and adjusting bids on low-visibility keywords can significantly reduce wasted spend. The discussion then pivots to the importance of dynamic bid ceilings calculated at the ad group level, rather than a single account-level average, to optimize bids more effectively across various products and conversion rates. In contrast to simply increasing bids across the board, the hosts advocate for a more nuanced approach, adjusting bids based on individual ad group performance and profitability. This means for Amazon advertisers, a more granular and data-driven approach to keyword management is crucial for maximizing ROI and avoiding costly inefficiencies.
