PPC Glossary of Terms for Amazon
Glossary of PPC Terms
Advertising Cost of Sales. You get to this number by taking your ad spend and dividing it by your total ad sales. For example, if you spent $100 on ads and that generated $400 in sales, your ACoS would be 25%.
In order for a keyword or campaign to break even, your ACoS would need to be your profit margin after all expenses or less.
Advertising Cost of Total Sales. You get to this number by taking your ad spend and dividing it by your total sales. For example, if you spent $100 on ads and that generated $1,000 in sales, your ACoS would be 10%.
ACoTS is generally a much better indicator of the health of your business as all advertising sales are doing their part to drive organic rank on the targeted keywords.
Or Cost Per Click is what Amazon charges you every time someone clicks on one of your ads. Cost per click is an important metric in advertising. In order to understand what CPC is sustainable for any particular campaign, you’ll also need to look at your conversion rate and profit margin.
For example, if you had a CPC of $1 and a 10% conversion rate, that means for every $10 spent, you’d make a sale.
is short for Click Through Rate. Your click-through rate is your number of clicks divided by your number of impressions.
is short for Conversion Rate. The conversion rate is the number of clicks divided by the number of sales. So if you have a 10% conversion rate, you are making 1 sale for every 10 clicks.
The degree of exactness that something adheres to. In other words, the consistency of data.
The “floor” is what we call the bottom of the bid amount needed to start getting clicks. If we are being conservative in our ad spending, we want to identify the “floor” for a keyword and work our way up.
the total number of people your ad was shown to
Ranking/Position is related to each specific keyword phrase and where Amazon is displaying your product listing. In virtually all cases, the closer you get to #1 position for a given keyword, the more sales you’ll make.
This is one of the most important aspects of the business and one of the main ancillary benefits of effectively run PPC.
Optimization has a variety of factors that include the keywords within your listing (both front and back end), the listing content, your product images, any Enhanced Brand Content, your price and reviews. Each of these things factors into whether visitors turn to customers and each of them can be tested to ensure they are converting at the highest levels.
Relevancy is whether or not Amazon determines your keyword as useful and applicable to potential customers looking at your product. In other words, how likely is someone searching for “______ _____ ____” going to be happy if Amazon shows them your product?
similar to impressions in advertising, sessions are what Amazon calls visitors. Sessions are the number of people who have visited your product listing page. This number includes both organic visitors and those driven by advertising.
This is the same as your conversion rate. Whereas the ad platform has a metric called Conversion Rate, when you look at your total stats under Business Reports, you’ll see Unit Session Percentage. Like sessions, this number included both organic and PPC based stats.
