Machu Picchu
Objective:
To increase consistent sales growth and profitability by leveraging strategic marketing initiatives, reducing TACOS, and enhancing customer retention through innovative solutions. Additionally, to tackle the challenges of high CPC and low conversion rates by optimizing ad spend and improving conversion strategies
1. Challenges:
- Higher consumer CPC
In a highly competitive niche, the cost-per-click (CPC) continues to rise, making it increasingly expensive to drive traffic to product listings, despite significant investments in advertising.
- Lower Conversion rate
The conversion rate remains below the category median, leading to inefficiencies in turning clicks into actual sales.
- Soaring TACOS
As a result, the total advertising cost of sales (TACOS) is elevated, directly impacting overall profitability and limiting the ability to scale effectively. These challenges strain the marketing budget and hinder long-term growth, necessitating a strategic approach to optimizing ad spend, enhancing targeting, and improving conversion rates.
2. Strategy:
- Promotions:
- To incentivize customers, we offer a discount on their first purchase
- Brand-tailored promotions with a 10% discount targeting customers who added items to their cart but did not complete the purchase.
- Quantity discounts to increase Average Order Value (AOV), encouraging customers to buy multiple units per order.
Revamped Creatives and copywriting
To enhance listing performance, I implemented a strategic approach focused on revamping creatives and optimizing copywriting. This involved conducting A/B testing on product titles to determine the most effective variations in driving click-through rates and conversions. By analyzing customer engagement and response patterns, I identified high-performing titles that improved visibility and sales, ultimately contributing to a more compelling and conversion-driven listing.
3. Targeting Diversification
- Broadened ad targeting to expand reach and attract new customers:
- Launched Sponsored Product campaigns with broad keywords using Phrase, Broad, and Exact match type
- Introduced Sponsored Brand Video ads to improve brand awareness and increase the new-to-brand customer base.
- Utilized unique headlines and creatives in Sponsored Brand ads to drive traffic to the Amazon Store, boosting store visits and cross-SKU purchases.
- Implemented Sponsored Display remarketing campaigns targeting:
- Customers who viewed but didn’t purchase.
- Past purchasers for potential repurchases.
We launched multiple new campaigns to discover and target relevant keywords with a lower CPC, resulting in a reduced ACOS compared to other keyword match types. The auto campaign, in particular, unlocked untapped potential by identifying high-performing search terms. Additionally, competitor targeting ran in parallel with the auto campaign, further enhancing visibility and driving efficient ad spend
4. In-depth Optimization
- Analyzed and optimized campaigns for better efficiency:
- Paused underperforming campaigns and keywords with poor conversions or high spend but no sales.
- Utilized unique headlines and creatives in Sponsored Brand ads to drive traffic to the Amazon Store, boosting store visits and cross-SKU purchases.
- Implemented Sponsored Display remarketing campaigns targeting:
- Customers who viewed but didn’t purchase.
- Past purchasers for potential repurchases. Negative targeting for irrelevant keywords in Exact and Phrase match types, minimizing wasteful ad spend.
- Conducted ongoing optimization to improve ROAS and reduce TACOS.
The Results
- Month-over-month top line growth with improving TACOS.
- Reduced the TACOS from 66% in June to 22% in Dec ‘24 a 66% reduction in total acquisition cost.
- Introduced Subscribe and Save coupons increasing the number of subscribers and repeat purchases.
- 256% increase in New-to-Brand customers increasing the overall customer base.
