Amazon's Bid+ Strategy Discovery

Similar to AdWords’ Smart Bidding, Bid+ is the Amazon Marketing Services (AMS) solution for enhancing a retailer’s performance through raising keyword bids during peak times. With Bid+, a retailer allows Amazon to increase any keyword bid up to 50% in order to push that keyword to the top of a search results page for increased clicks, impressions, and visibility.
 
Bid+ In Action
We performed an informal test to determine the effects of Bid+ on live campaigns. For this test, we chose four similarly performing campaigns each having a lifetime Advertising Cost of Sale (ACoS) below 20% and over $50 in spend in the previous four weeks. Ideally, we would have set up a proper experiment within the engine, but at this time Amazon does not offer an A/B test tool within the UI. Because of this, we strove to control as many variables as possible during this trial.

The Findings:

 

• Revenue increased in Campaigns "B" and "C", while it decreased in Campaigns "A" and "D."


• The campaigns that saw a decrease in revenue also saw a decrease in impressions and clicks, whereas the campaigns that saw an increase in revenue saw an increase in impressions and clicks.


• In all cases, the Advertising Cost of Sale (ACoS) and the Average Cost Per Click (ACPC) increased, informing us that despite pushing bids, we are not bringing in revenue as effecient as we were before Bid+.


• These KPIs indicate Bid+ is pushing wherever it sees competition (as advertised) regardless of performance.

In Conclusion
Since we saw ACOS and impressions increase in all test campaigns, this infers that Bid+ may not be an effective direct response tactic. Rather, it can help build your brand’s presence and increase overall Search Engine Results Page (SERP) presence (especially for products that live on Page 2) on core queries and products. Additionally, brands that have teams dedicated to manually adjusting bids and pacing the spend of accounts may find more success only using Bid+ tactically in certain situations where efficiency may not be the primary KPI.

The purpose of this test was to provide a quick and dirty look into the impacts of Bid+ through the lens of direct response. As this was an informal test that purposefully did not have strong controls, we want to encourage industry thought leadership to explore and vet these results as we continue to build up a body of literature around various AMS performance tactics. If you’re interested in learning more about implementing an effective Bid+ strategy for your brand, reach out to Rise.