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Benchmarking performance is a critical part of scaling on Amazon. In this blog post series, we’re going to share some key data points that will help refine your 2020 marketing strategies.


January came and went in a flash. Did you hit all of your Amazon sales and advertising targets?

At Bobsled, we’re always trying to win our clients more market share. And in order to develop effective growth strategies, we keep very close tabs on both macro and category-specific trends.

In this blog post series, we’re going to be sharing finalized stats and figures from the month prior that will give context to your brand’s performance on the Amazon marketplace.

 

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How Much Should I Spend On Amazon PPC?

Ascertaining the right level of ad spend is a critical part of any successful Amazon marketing strategy. Of course, the correct approach will depend on the specifics of each situation. However, every brand selling on the Amazon marketplace should be keeping tabs on relevant marketplace trends that help give context to their own account’s performance.

Bobsled is an official partner of Kenshoo, a marketing technology leader. We utilize Kenshoo’s suite of services within a multitude of Amazon accounts under our management in order to automate and optimize performance.

At the end of each month, Kenshoo provides us with core KPI performance metrics for some select Bobsled clients. Kenshoo also provides Bobsled with category-specific statistics that are compiled from a broader sample of anonymized data. As a team, we analyze and interpret these data sets internally, and share our collective analysis within this recap series which comes out around the middle of every month.

This data series where we dissect real performance metrics will help you understand how to better position your brand within the Amazon ecosystem.

Kenshoo

 

What Happened On Amazon In January 2020?

Before we dive into the data, let’s look at the biggest Amazon news stories that broke during January 2020. Did any of the following directly impact your brand? 

  • Amazon started offering 100% off referral (selling) fees for UK sellers who enroll for Seller Fulfilled Prime (SFP) for the first time. This is in stark contrast to the US market, where Amazon has closed applications to SFP. 
  • Amazon pledged $1BN to bring small and medium Indian businesses online. The Indian government has a fractious relationship with Amazon, but India represents massive opportunity for Amazon both in terms of shopper and supplier growth.
  • Amazon will reportedly work with law enforcement for ongoing counterfeit issues. While details of the program are scant right now, there could be several challenges with this approach depending on how it’s rolled out.
  • Amazon is expanding to the Netherlands later this year, and sellers can start registering their accounts now.
  • Amazon announced strong Q4 earnings. Highlights: Amazon now has over 150M paid Prime subscribers, Amazon's revenue rose 21% Y/Y, and "Other" revenue, which is dominated by ad sales, rose 41% to $4.78B, beating a $4.62B consensus.

 

January 2020 Amazon Performance Data

Now let’s review some numbers! The following statistics are compiled from a sample of anonymized data from 36 Amazon Bobsled accounts across 6 marketplaces.

 

Main KPIs

Impressions

December 2019 January 2020
263,510,590
188,321,932

Impressions are down by 28.53% compared to December 2019. This is because there’s less traffic and lower purchase intent compared to December, the highest selling month of the year.

 

Clicks

December 2019 January 2020
840,890 674,827

Clicks are down by 19.75%.

 

Conversion Rate

December 2019 January 2020
8.86% 7.35%

Conversion rate is down by 17.04%.

 

Average CPC

December 2019 January 2020
$0.67 $0.57

Cost per click is also down by 14.93% which is a nice win to see every January! Advertisers should always remember to scale down spend after the madness of Q4.

 

To summarize the above January 2020 data points in a word: downtrending. Q4 is over, shopper behavior has changed dramatically, and this impacts every core metric. 

Takeaway: brands can use this period that requires relatively lower involvement with PPC management to focus on landing page optimization (updating their product listings and storefronts), refresh their back-end keyword strings, review pricing policies and work on their promotional calendar for the remainder of the year.

 

Category Specific Data - Apparel, Grocery & Beauty

Bobsled has high-level experience within Apparel, Grocery and Beauty, and we follow trends within these categories closely.

The following statistics are compiled from a broad sample of anonymized Kenshoo data; 35 Apparel accounts, 82 Beauty accounts and 64 Grocery accounts (see ‘Count Active Profile’ row of below tables).

 

Apparel Jan 2020 Performance Data

Metric Apparel Dec '19 Apparel Jan '20 %
Impressions 1,157,146,070 614,043,274 -46.93%
Clicks 4,366,565 2,410,244 -44.80%
Spend (USD) $2,802,837.56 $1,282,419.84 -54.25%
CPM $2.42 $2.09 -13.64%
CTR 0.38% 0.39% 2.63%
CPC $0.64 $0.53 -17.19%
Conversions 774,529 373,803 -51.74%
Conversion Rate 17.70% 15.50% -12.43%
CPA $3.62 $3.43 -5.25%
Revenue (USD) $34,098,032.53 $14,940,276.42 -56.18%
ROI $12.17 $11.65 -4.27%
Count Active Profiles 34 35 2.94%

 

 

Beauty Jan 2020 Performance Data

Metric Beauty Dec '19 Beauty Jan '20 %
Impressions 1,307,067,398 1,151,272,138 -11.92%
Clicks 4,033,732 4,427,877 9.77%
Spend (USD) $9,097,760.43 $7,510,205.14 -17.45%
CPM $6.96 $6.52 -6.32%
CTR 0.31% 0.38% 22.58%
CPC $2.26 $1.70 -24.78%
Conversions 1,044,274 1,236,095 18.37%
Conversion Rate 25.90% 27.90% 7.72%
CPA $8.71 $6.08 -30.20%
Revenue (USD) $20,395,705.35 $19,654,708.09 -3.63%
ROI $2.24 $2.62 16.96%
Count Active Profiles 77 82 6.49%

 


Grocery Jan 2020 Performance Data

Metric Grocery Dec '19 Grocery Jan '20 %
Impressions 537,324,771 388,280,117 -27.74%
Clicks 2,265,036 1,456,144 -35.71%
Spend (USD) $3,020,313.62 $1,942,347.69 -35.69%
CPM $5.62 $5.00 -11.03%
CTR 0.42% 0.38% -9.52%
CPC $1.33 $1.33 0.00%
Conversions 503,694 313,241 -37.81%
Conversion Rate 22.20% 21.50% -3.15%
CPA $6.00 $6.20 3.33%
Revenue (USD) $10,817,552.88 $5,354,407.59 -50.50%
ROI $3.58 $2.76 -22.91%
Count Active Profiles 62 64 3.23%

 

Here’s what the Bobsled team has surmised about the above data sets:

  • All categories suffered losses in January compared to December. This is expected, of course, due to the general Q1 vs Q4 theme of downtrending.
  • Apparel lost the highest % of revenue. Hypothesis: Apparel items on Amazon are likely more giftable compared to Beauty and Grocery products. This is why there’s such a peak during the Holiday shopping season and then a trough in January.
  • Grocery had the highest hit on ROI in January compared to December. Again, this could be linked to Holiday food shopping - customers are tightening their belts (literally!) in January.
  • Once again, Apparel ROI data is much better compared to the other categories.
    In last month’s post we explained how some outlier accounts are likely skewing the figures.

 

What Does This Data Mean For Brands?

Unless your product line is suited to perform exceedingly well in the colder months at the start of year, you likely experienced a MOM downturn in January. This means less impressions, less clicks, and unfortunately, less sales.

At Bobsled, we use this brief downturn to plan ahead for the rest of the year. Here are the areas we’d encourage you to look at before Q1 concludes.

  • New Product Launches. What got you here, won’t get you there. Figuring out when and how to launch new products in 2020 should be an immediate priority. For more info, take a look at Bobsled’s Product Launch Plan.
  • Inventory Management. There is nothing more frustrating than looking back at Q4 and realizing there were huge missed opportunities due to stock-outs. At the same time, overstocking during a low season can lead to costly additional fees. For more info, read Bobsled’s Winning Strategies For Amazon Inventory Management.
  • Q4 2020 Preparation. Most brands see a huge Amazon sales spike in the last quarter, and so there’s no such thing as “too soon” when it comes to Q4 prep. Review your 2019 Q4 data closely, and start thinking about what you should do differently this year. Here’s a great article Top Growth Lessons Learned Before, During And After Q4 that spells out the steps you should take.  

 

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Need More Insight?

We hope you enjoyed the January installment of our monthly data recap series! To read through December 2019 performance data, click here. The next installment in the series will go live on Thursday March 12th - sign up to our mailing list so you don’t miss a thing.

Need more help analyzing your January Amazon performance and locking down your strategy for 2020? Click the "contact us" button, complete the form and a Bobsled team member will be in touch to schedule a consultation.

CONTACT US

Tagged: PPC Advertising, Clothing, Amazon Account Management, Grocery & Gourmet Food, Beauty

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