Auction Campaign Best Practices Guide

Launching your first auction campaign is a significant step toward optimizing your advertising efforts, and we're here to help you make the most of it. This comprehensive guide is designed to provide you with the best practices for achieving optimal campaign performance. Whether you're fine-tuning your budget, selecting the right bid strategy, or analyzing your campaign’s success, these foundational tips will set you on the path to success.

In this guide, you’ll find:

• Campaign Setup
• Setting & Scaling Your Budget
• Bid Strategy
• Learning Phase
• Measuring Performance
• Optimizing Your Campaigns

Campaign Setup

• Combine Similar Products: Grouping similar products into a single campaign helps optimize budget allocation, increasing the chances of generating results and reaching a broader audience.
• Segment Diverse Products: For products in different categories or with significantly different prices, create separate campaigns to better target specific audiences and maximize relevance.
• Include Sufficient Products: Ensure each campaign contains at least 5-10 products. This provides enough data for the algorithm to learn effectively, keeping the campaign healthy and running successfully.

Setting & Scaling Your Budget

• Set a Daily Budget: Daily budgets tend to spend more efficiently than lifetime budgets, offering better control over your campaign’s performance.
• Minimum Budget: Autobidding campaigns require a minimum budget relative to the number of products included. Campaigns with a large number of products will need a higher budget to ensure sufficient clicks for multiple products each day. The platform will alert you if your budget is too low during campaign creation. As a general guideline, invest at least $15/day for campaigns with more than 100 products.
• Increase Your Budget Wisely: When your campaign approaches 80% budget utilization, consider gradually increasing the budget by no more than 50%. Allow at least 5 days between changes to maintain stability and avoid performance fluctuations.
• Budgets for High-Priced Items: Campaigns with high-priced items often require a slightly higher budget due to higher CPCs and the need for more impressions and clicks to drive purchases and achieve a positive ROAS.

Bid Strategy

• Autobidding: The Autobidding feature is designed to simplify the bidding process by automatically adjusting bids in real-time. It uses advanced algorithms to evaluate factors like your daily budget, historical performance data, clicks, impressions, and current market conditions, continuously optimizing your bid strategy to maximize competitiveness and efficiency.
• Manual Bidding: Manual bidding allows you to set specific CPC bids for each product, but requires more time and constant monitoring. This approach gives you full control but can be challenging to keep up with real-time market fluctuations. Given its complexity, Autobidding is recommended for most campaigns due to its proven efficiency and consistent results.

Choosing a Bid Strategy for Your Campaigns

• Aggressive: Maximizes visibility and drives higher sales, even at the expense of a lower ROAS. Ideal for new product launches, clearance events, or high-traffic periods.
• Moderate: Balances cost and visibility, ensuring steady performance with efficient ad spend.
• Conservative: Prioritizes a higher ROAS by participating in fewer auctions but only those with a high likelihood of conversion. Suitable for established products focusing on profitability.

Learning Phase

• New Campaigns: Allow 5-7 days for the algorithm to gather sufficient data and stabilize performance before making any changes.
• High-Consideration Products: For longer purchase cycles (e.g., mattresses), allow 7-14 days for stabilization due to the extended decision-making process.
• Existing Campaigns: When adjusting the budget, allow 5 days between changes to avoid disrupting the learning process.
• Bid Strategy Changes: Allow 5 or more days between bid strategy changes to assess their impact accurately.

Measuring Performance

• Attribution: The platform uses a 14-day post-click attribution window. A sale is attributed to the campaign if a user clicks on a sponsored listing and makes a purchase within the next two weeks.
• Analyze Performance: Detailed insights into your campaign performance are available through your seller dashboard, with KPIs such as ad spend, sales, impressions, clicks, average CPC, and ROAS. Performance can be viewed at both the campaign and product levels.

Key Performance Indicators (KPIs)

• Return on Ad Spend (ROAS): Measures revenue generated relative to ad costs.
  • ROAS = Total Revenue / Total Spend
• Cost-per-Click (CPC): Determined by your maximum bid, either manually or through Autobidding.
  • CPC = Total Spend / Total Clicks
• Conversion Rate (CVR): Measures the percentage of purchases relative to clicks.
  • CVR = Total Purchases / Total Clicks
• Click-Through Rate (CTR): Measures the percentage of clicks relative to impressions.
  • CTR = Total Clicks / Total Impressions
• Auctions Won: Reflects the competitiveness of your bids.
  • Auctions Won % = Total Auctions Won / Total Eligible Impressions
• Impressions: The number of times your product is displayed to customers.
• Clicks: The number of times a customer clicks on your ad.
• Promoted Sales: The total revenue generated from all purchases driven by your ads.

Optimizing Your Campaigns

• Monitor Campaign Spending & Adjust Your Budget Wisely: If your campaign is spending over 80% of its daily budget, increase it to enable bidding in more auctions, boosting impressions, clicks, and purchases. Gradually increase by no more than 50%, with at least 5 days between changes.
• Analyze Performance at the Product Level: Identify top and bottom-performing products. Deactivate underperforming items (after 2-3 weeks) if they show significantly lower CTR to allocate more budget to higher-performing products.
• Adopt a Full Funnel Strategy: Combine promoted product campaigns with upper-funnel formats (e.g., banner ads or Everyday Rewards campaigns) to increase brand awareness and drive sales when consumers are ready to purchase.
• Prepare for Tentpole Events & Seasonal Trends: Scale up budgets and launch campaigns 2 weeks before major sales events or seasonal shifts. Adjust your strategy for high-demand periods to account for rising CPCs.
• A/B Test Your Bid Strategies:
  • Aggressive, Moderate, and Conservative Strategies: Test different strategies during special events or product launches to determine the best fit.
  • Automatic vs Manual Bidding: Although Autobidding is recommended, test manual bidding for greater control over CPC. Allow the algorithm time to learn (at least 2 months) before switching.