Amazon's advertising budget has doubled by hundreds of times? Is this crazy or just crazy?

We are getting closer and closer to the year-end peak season in November. Although the registration for Cyber ​​Monday and Black Friday events has ended, the detailed schedule of the events has not yet been announced.

During this period of time, everyone’s job is to try to increase the product’s traffic, order volume, and ranking before the schedule is determined, and try to let the algorithm capture the product’s excellent performance, and then schedule a good time period for your Black Friday event.

Therefore, before the peak season, there is also extremely fierce competition among sellers. Usually, the advertising bids during this period will be about double that of usual times.

However, the recent advertising performance is very abnormal. The recommended budget in the background is dozens of times higher than usual! Many sellers in our communication group have reported this problem and have taken screenshots to ask me for help.

For those who usually spend 500 yen a day, the recommended budget is 150,000 yen

For those who usually run 10 dollars a day, the recommended budget is 1100 dollars

The recommended budget of an ad group is hundreds of times higher than the actual budget! Note that this is not because the budget is usually low. The student who provided the material usually has a daily budget of 1,000 yen. The usual recommended budget is slightly higher than the actual budget, usually around 1,500 to 2,000 yen , but today the recommended budget of this ad group has been directly raised to 300,000! Is Amazon really crazy about money?

How come the budget increased hundreds of times?

In the period before the peak season, the recommended bid for ads is indeed much higher than usual. Especially with the recent exposure of fake reviews, Amazon has launched another wave of crackdowns on fake orders, and the operation of fake orders to rank is no longer allowed.

Many sellers have turned their attention to in-site advertising, hoping to use CPC to burn money to boost rankings. As everyone is scrambling to run ads, the recent advertising bids are higher than usual during the peak season.

Although an increase in the recommended bid will also lead to an increase in the recommended budget, it is obviously not normal for the recommended bid to double from $5 to $500. Either a backend bug caused the recommended budget to explode, or Amazon modified the recommended budget algorithm for peak season advertising campaigns.

The first possibility is that it is not the first time that advertising data has gone wrong on Amazon due to a backend bug. In fact, at the beginning of this year, Amazon’s backend had a bug that caused the actual advertising costs to exceed the budget by more than ten times.

In the end, Amazon compensated for the excess. Although the recommended budget this time is more exaggerated than the BUG at the beginning of the year, the recommended budget is not the actual budget. It is just a reference value at best. Therefore, even if this time it was caused by a BUG, ​​the impact is not significant.

The second possibility is that Amazon has adjusted the algorithm for the recommended budget for advertising during the peak season. Advertising is now one of Amazon's most profitable businesses, and it is completely reasonable for my brother-in-law to further earn more advertising fees and thus increase the recommended bid and recommended budget.

But if this is a normal algorithm adjustment, it is too radical, directly increasing the recommended bid by hundreds of times. So I think even if Amazon is really adjusting, there may still be some bugs in the numbers.

When I was guessing, I ruled out the possibility that some black technology players or excessive advertising spending caused the recommended budget to soar. Because unlike the daily recommended budget that has increased by hundreds of times, the recommended bid is still about two or three times the usual bid, which is within the normal range during the peak season.

Although it is very likely a bug, and the recommended budget has no actual impact on the seller’s advertising expenses, the signal sent by this situation still needs us sellers to carefully consider.

As mentioned above, advertising is one of Amazon's core profit points. Therefore, the crackdown on black technology and fake orders is not entirely for the purpose of purifying the e-commerce environment. In part, these measures will reduce Amazon's advertising revenue. If fake orders are killed, everyone who wants to sell well will have to spend money on advertising, which is in line with Amazon's principle of putting profit first.

However, the increasing advertising bids are not entirely the result of Amazon's behind-the-scenes manipulation. One of the fundamental reasons is that many sellers who do not understand the advertising algorithm routines blindly increase their budgets.

Experienced sellers who are already familiar with advertising must know one thing: advertising groups need to be cultivated. From the early word selection and bidding to the later negation and optimization, they all require periodic adjustments.

The process of cultivating an ad group is also a process of letting the algorithm gradually match the ad words with your products. A well-cultivated ad group, because it has a high degree of match with the ad words, can get a good exposure and exposure position even if it is lower than the recommended bid. During the peak season when everyone is bidding, such an ad combination will leave the seller with a very considerable amount of advertising fees.

Therefore, we should look at the bidding and budget issues of advertising calmly and objectively. If you blindly increase the bidding without paying attention to the matching degree between the advertising words and the product, it is very likely that the advertising costs will be wasted. The recommended bidding price of the entire industry is too high, which will harm others and benefit neither you.

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