Introduction
Welcome to the Amazon Advertising Data Trends Review Series for November 2020. This is a monthly blog series where we:
- Breakdown changes in the Amazon advertising market landscape
- Pinpoint key areas of improvement
- Provide guidance on future market expectations
If you missed last month’s edition, you can check that out here.
By reviewing the data and trends in the proceeding blog post you will gain a better understand of what has happened in the Amazon advertising marketplace in November. In turn, it will enable you to strategically position your ad campaigns for December and beyond.
Market Overview
In this section, we break down the aggregate view of the Amazon advertising marketplace. More specifically we will review what happened to ACoS for November and analyze KPI’s that influenced the movements in ACoS.
November - The Lull before the Holidays
ACoS, Ad Spend per Order, and Cost per Click decreased during the first 3 weeks of November before starting to increase towards the end of November. Towards the end of November is the start of the holiday shopping season and is primarily driving the increase in these metrics as sellers gear up for the competitive shopping season.
Last month we experienced the impact Prime Day has on the KPI’s. This month we had Black Friday and Cyber Monday. Some of the KPI’s had a noticeable impact on these shopping days, but ultimately the data shows that there was less of a marketplace change than during Prime Day.
6 Month View
1 Month View
ACoS, Ad Spend per Order, and Cost per Click reached a monthly low on November 22-23, before proceeding higher. Cost per Click and Ad Spend per Order had an interesting spike on November 17th.
Conversion % - Black Friday Spike
Conversion % is the only metric that experienced a noticeable change due to Black Friday, spiking on November 27th. Conversion % started the month at around 12% increasing 3% on Black Friday.
1 Month View
Ad Spend per 1000 Impressions and CTR% had steady declines throughout November. While Revenue per Click experienced a slightly increasing trend throughout November.
Overall, ACoS declined after October’s Prime Day before starting to rise again leading up to Black Friday and Cyber Monday. This was largely driven by the increases in Cost per Click and decreasing CTR%.
Aggregate Trends
Outside of the monthly changes, there are a few key longer-term trends we’ve been monitoring to see if these are larger marketplace changes that are here to stay if they will be short lived.
Despite dropping lower after Prime Day in October, Ad Spend per 1000 Impressions and Cost per Click continue to have increasing trends since June.
CTR has consistently struggled to break through the 0.40% level. Towards the end of October, the 0.40% line was broken through and held for most of November before falling back below 0.40%. This seems to be a short-lived breach and consistently remains to be a resistance level.
Match Type Breakdown
In previous blog posts we’ve mentioned the convergence of the ACoS by match type and all 3 match types continue to remain converged for November. Additionally, Ad Spend per Order continue to have Phrase and Exact match types converged.
Conversion % Reversed to Yearly Highs
Last month we saw that conversions reached yearly lows leading up to Prime Day, then spiked significantly on Prime Day. However, leading up to Black Friday there was no such decline in conversions, but a similar spike occurred. This caused yearly highs to be made for conversions in the Phrase and Broad Match Types. Exact Match Type didn’t quite create a new high, but it was extremely close. This must be due to the nature of the event with Prime Day being an Amazon specific event while Black Friday is a broader industry event.
An additional item to note is that conversions saw a consistent increase during November, while Exact and Broad were flat for most of November before spiking on Black Friday.
Placement Type – Longer Term Trends
Ad Spend per 1000 Impressions, Top of Search Placement experienced a decreasing trend in November reaching a 6-month low of $36.
The Cost per Click in Top of Search was experiencing an increasing trend since July. However, this trend was broken during November. Remarking Off Amazon continues to experience an increasing trend since July.
The CTR% for Top of Search and Other on Amazon continue to experience increasing trends.
With a no longer increasing CPC trend in Top of Search and an increasing trend in CTR% for Top of Search and Other on Amazon, these placement types could experience more favorable ACoS’s in the future, all else remaining the same.
November’s Predictions
In this section we forecast what we think may happen to the KPI’s by reviewing the Year over Year trends. But before we start, let’s dive into what we had forecasted would happen for November:
- Decrease:
- ACoS
- Ad Spend per 1000 Impressions
- Ad Spend per Order
- Cost per Click
- CTR%
- Increase:
- Conversion %
- Revenue per Click
Let’s see how we did on our predictions and forecast what we believe will happen in December.
ACoS had decreased significantly in November, aligning expectations with our previous month’s expectations. In both 2018 and 2019 we experienced ACoS decreasing in December, therefore, we expect ACoS to decrease further next month.
Ad Spend per 1000 Impressions had a very slight decrease for November decreasing from $3.50 to $3.40, aligning with expectations. Next month, we are to see a slight increase given both 2018 and 2019 experienced increases in December.
Ad spend per Order decreased significantly in November, aligning with expectations. Both 2018 and 2019 experienced decreased in December, therefore we’re expected to see further decreases in December.
Conversions increased in November, aligning with our expectations. In both 2018 and 2019 conversions increased in December, therefore we’re expecting further increases next month as well.
Cost per Click decreased in November, aligning with our expectations. In 2019 there was an increase, while in 2018 there was a decrease. The expectation is that 2020 will follow more closely with 2019 and therefore we expect to see an increase in CPC for December.
Click Through Rate increased in November, while we were expecting a decrease. 2018 saw an increase while 2019 saw a slight decrease. Since 2019 is the most recent data, we’d expect to see a slight decrease in December for CTR%.
Revenue per Click increased during November, aligning with expectations. Both 2018 and 2019 saw an increase in December, therefore we’re expected to see further increase next month.
Conclusion
Last month we experienced how much Prime Day impacts the KPI’s. However this month we noticed that Black Friday and Cyber Monday had nowhere near the impact on the KPI’s as Prime Day had. Overall, the key points for this month include:
- ACoS seemed to be ticking up towards the end of November, however the past 2 years shows us that ACoS typically decreases during December
- Conversions saw a spike during Black Friday causing yearly or near-yearly highs for each of the individual Match Types
- The continued longer-term trends in Top of Search and Other on Amazon Placement Types could mean allocating higher ad-spends to these placements would be beneficial in your overall strategy
We’ll be reviewing this data and including deeper insights and trends each month. If you have any questions or any data you’d like to see, please reach out.
