Posted: July 26
There is one place where cannibalization could be considered positively. Believe it or not, Amazon sales cannibalization could be a great way to maintain your organic rankings.
First things first. What is sales cannibalization? It means your advertising placements receive clicks and sales (around 30%) instead of your organic ones if both are highly placed.
Very often, even if you stop advertising particular keywords (KWs), short-term, you will probably receive a similar amount of sales organically.
So, why do we need ads at all? Here’s the deal.
The top 3 placements have the best Click-through-rate (CTR) and conversion rate (CVR). All of them are advertising spots. The rest are organic. If you don’t advertise, your competitors will take the higher Top-of-search (ToS) placements, and ultimately CVR and CTR. Based on these metrics, Amazon will consider their product as a better fit for that KW, your ranking would slowly drop, and you will lose the sale. It’s sometimes better to pay $1 or $2 for those higher bids but win the long-term game.
For example, if you have a Sponsored Brand top placement, your advertising on ToS, ocupy one of top 1 to 3 organic placements and have a Sponsored Video ad, you occupy half of the result page. It guarantees much more visibility and the possibility for your customers to notice and click on your product.
The problem is to find the perfect balance.
What do we do at the AMZ Bees Agency? We switch between paid ads and organic efforts on cycles. When we see organic ranking start to drop, we push advertising. Our goal is to maintain healthy TACoS and margins for the long term.
You can’t avoid 100% of sales cannibalization, but you can make it work for you, not against you.
AMZ Bees is an e-commerce agency that grows and manages brands on Amazon with advanced PPC strategy, listing conversion optimisation and problem solving.
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