Franklin Sports: How to Lower ACoS Using Amazon CAPx & Granular Campaigns
Founded in 1946, Franklin Sports is the home of the official MLB, NFL, MLS, NHL & college sports gear, sporting goods, indoor games & more for athletes & sports fans of all ages.
In recent years, they’ve successfully transformed their family owned & operated business to accommodate for the eCommerce revolution – with a major focus on Amazon.
Today, they offer thousands of products on Amazon and their digital advertising playbook continues to rapidly expand every year.
Earlier this month, Franklin Sports joined CPC Strategy at AdDiego to discuss their Amazon Advertising Console strategy (Amazon’s Advertising Console is formerly known as Amazon Marketing Services).
Didn’t get a chance to attend the presentation? Don’t worry!
From campaign structure to the use of technology – we’ve got a full recap of the event below from presenters Scott Kennedy (Director, eCommerce Analytics & Digital Marketing at Franklin Sports) and Pat Petriello (Head of Marketplace Strategy at CPC Strategy).
Franklin Sports & Amazon: The Beginning
You would never know it by the looks of their massive online selling success today – but Franklin Sports wasn’t always so sure of their Amazon ad strategy.
According to Kennedy (who now oversees Franklin Sports digital marketing advertising efforts), when he joined the team – Franklin Sports wasn’t running any ads via the Amazon Advertising Console.
“Eventually, we decided to open the flood gates [to Amazon] and the digital marketing company we were working with at the time built out a few high level campaigns.”
“But very quickly it became obvious that this particular agency did not consider technology a core competency. You will find that some marketing firms will buy technology from somewhere else and push those costs onto you. One of the big reasons Franklin Sports decided to team up with CPC Strategy was because of their in house technology – the Amazon CAPx platform.”
About AMS CAPx:
Advertising Console (previously called AMS) is a powerful ad platform and when used correctly, it can be a game-changer. But if you’re managing your campaigns using Amazon’s interface (like many brands still do today), you will eventually run into some challenges – especially when trying to scale. That’s why CPC Strategy developed CAPxAMS, an Amazon marketing tool specifically for AMS management. You can learn more about our technology here.
Main Challenges Facing Franklin Sports:
But technology wasn’t the only challenge facing Franklin Sports back then. They also needed to completely overhaul their campaign structure and improve their ACoS.
In the following recap, Franklin Sports discussed each of these challenges and how teaming up with CPC Strategy has enabled their business to grow more efficiently and optimize their Amazon campaign management.
- Challenge 1: Poor Campaign Structure
- Challenge 2: Bring Down ACoS & Achieve ACoS Goals
Challenge 1: Poor Campaign Structure
“One of the first things we did with CPC Strategy is we established an extremely granular campaign structure. Before we had an entire baseball category lumped into a single campaign with 500 ASINs. That was suboptimal to say the least,” Kennedy said.
“With CPC Strategy, we took every single model and broke it out into several different campaign types including an automatic campaign, a manual campaign, a manual branded campaign, and sometimes a conquesting campaign.”
The value of a granular campaign infrastructure:
At CPC Strategy, we believe running Automatic Campaigns and harvesting data is a critical first step in your Amazon advertising strategy.
With Automatic campaigns, Amazon will target your ads to all relevant customer searches based on your product information. Bidding on the right keywords for your products can improve your page sales rank and organic listings, and will ultimately influence your product sales.
By running automatic campaigns, Franklin Sports was not only able to analyze their customer search term data on a granular level, but they were also able to make strategic decisions on which products and keywords to bid higher or lower on.
By harvesting search term data from their automatic campaigns, Franklin Sports was able to identify which key terms were valuable to specific ASINs. These valuable terms were then extracted and placed into their coinciding manual campaigns. Using exact match / phrase match, each keyword bid was adjusted accordingly (for example, they could now bid up on select profitable keywords for select ASINs).
“Looking back, we probably left a lot of money on the table because we didn’t initially set up our campaign structure correctly,” Kennedy said.
Key Takeaways:
- Campaign granularity and labels allow for flexibility and nimble advertising optimization.
- Reliable growth is the aggregate of persistent and ongoing automated micro-optimizations.
- Treat each product like it’s own business. Every campaign should have it’s own goals and independent KPIs.
- An automated rapid response to a dynamic market requires granular campaign structure.
“If you’re running granular campaigns, you can then apply those learnings back into your catalog. Overall, by implementing granular campaign management, you put yourself a leg up above your competitors.”
– Pat Petriello, Head of Marketplace Strategy
Challenge 2: Bringing Down ACoS
What is a good ACoS? It’s a question most brands struggle with. Of course, your ACoS will depend on a variety of factors. Are you trying to launch a new product? Or, are you just trying to be as profitable as possible? What’s your end goal?
After tackling campaign infrastructure, Franklin Sports’ next goal was to lower their ACoS.
This is a pretty common request we get from Amazon sellers: “I want to achieve improvements in both volume (increasing orders / revenue) and ROI (decrease ACOS) – oh, and I want to accomplish this quickly!”
However, what many sellers do not understand is that volume & efficiency can be competing goals, meaning that working towards one can undermine the other.
It’s a little tricky to understand, which is why CPC Strategy created our “Amazon Advertising Triangle” to help explain how we approach our Amazon management process.
You have 3 choices…
Amazon sellers have three choices (based on their short or long term company goals) including:
- Increase Volume Quickly (short-term goal)
- Increase Efficiency Quickly (short-term goal)
- Increase Volume & Efficiency (long-term goal)
In closing, the real question is: Can Sellers ever achieve improvements in both volume (increasing orders / revenue) and ROI (decreasing ACOS)?
The good news is – yes and that is something we’ve worked directly with Franklin Sports to achieve.
But it doesn’t necessarily happen overnight and here’s why:
In the long run, you achieve volume & ROI growth by identifying the optimal bid for each keyword – the point at which you’re maximizing volume while staying within your ROI goal. But that takes time.
It’s impossible to predict where the optimal bid for a given keyword is, you have to work up (or work down) to it by testing that keyword’s performance at different bid levels (aka running automatic and manual campaigns). And that optimal point is constantly moving based on how the rest of the market is bidding for that keyword & how your product is converting relative to others.
It’s a moving target which is why our Amazon Management team is constantly seeking out:
- Keywords that are converting poorly where we can cut wasted spend to improve efficiency, and
- Keywords that are converting well where we can increase bids to get more impressions & hopefully more orders as well.
“CPC Strategy’s CAPx technology is able to look at your keywords on all of your individual campaigns and adjust your bids based on off whatever your goals are. [For example, do you have a certain ACoS in mind?] Regardless of the goal, this technology is able to skim the bottom of the pool for you and adjust the bid(s) as needed.”
Key Takeaways:
- “Good ACoS” is relative to your marketing and business goals.
- ACoS is the output of myriad inputs, some of which are not advertising levers.
- Total profitability > Lower ACoS.
- Sales volume impacts organic rankings
The big question brands need to ask is: “What am I trying to achieve?”
The next step is implementing granular campaign structure, running automatic & manual campaigns, following the keyword harvested data and finally – leveraging CAPx technology to make bid adjustments based on your end goal.
For more information on how to implement granular campaigns and lower your ACoS, email [email protected]
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