The complete guide to promoting your products with sponsored products ads – Part 2


So you have read the basics and you are now ready to launch your first sponsored product ads campaign!

In this part we will talk about running your first campaign:
5. What products should you promote?
6. What kind of budget should I start with?
7. How do I decide what bid to offer?


 5. What products should you promote?

We suggest you give all of your products an equal opportunity to perform meaning that you promote all of them. Let the data guide you through the process and help you decide which products to promote. But in order to do it you must start with all of them.

Why? Because sponsored products ads can help you achieve all of the above mentioned goals for all of the products that you are selling and you should do it for all of them as they generate a positive marginal ROAS.

This is a good time to remind you that sponsored product ads are most important and effective when:

  • Introducing a new product or a line of products that need higher exposure
  • Selling products in a very competitive and crowded category.
  • Competing with big brands.
  • Having to get rid of stocks.

What do we mean by “Let the data guide you”?

After you start running sponsored product ads campaigns you will receive a lot of data about your products performance in the ecommerce stores – how many visitors see them (meaning how popular the category is), How many visitors click your products, what is their CTR (click rate), how many of them eventually buy the product (what is their conversion rate), How much promotion and budget you spend until you get one purchase, What is the winning bid for each product etc.

But this is only the beginning!

Now you can track each product’s performance and compare it to your other product’s performance and to the same product’s performance over time.

Is it doing worse now than it did 2 months ago? What does that mean?

Should I start working on a new model?

Is the bid price climbing or declining?

Is the competition becoming stronger or weaker?

Is this product not performing like the other models in the line?

Can I do anything about it?

Should I stop producing it?

Should I change the price?

This data is priceless and super important to your business not just for deciding whether or not to run sponsored product ad campaigns but to understand much more elementary issues.

As for deciding which products to promote or not…

We recommend to let the campaign run for 2-3 weeks (depends on the amount of impressions and conversions it generate) so you have enough data to start taking data driven decisions.

Based on the results of your campaign you should take these actions:

1. Exclude SKUs that don’t deliver. Later on we will elaborate how you measure if and how well it works.

2. Structure your campaign – split your campaigns by categories, make sure similar products are in the same campaign and set bids for each campaign according to your ACoS etc.


6.  What kind of budget should I start with?

There is a saying that there is only one way to win a 100 meter swim – You start as fast as you can and slowly you speed it up. Seriously now, if it is the first time you are running a sponsored products ad campaign for a product, you should start with a budget that can actually help you understand and learn its impact.

In most cases we suggest to start with a budget that will generate at least 100 clicks for each product you are promoting (based on the price per click you are willing to pay) – For example if you are selling 5 models of smartphones and willing to pay 1 Euro per click, you should start with a pilot budget of 5,000 Euros.

Usually 2,000 clicks will provide a good picture on the CTR, the conversion rate and the ROAS that the product can achieve.

After examining the results you can increase or lower the budget for each product. We suggest to increase the budget as long as it delivers a positive marginal ROAS.


Don’t panic!

  • Sponsored product ads are performance based – meaning that you don’t pay for impressions of the promotions – You only pay when a shopper actually clicks them and enter your product page. If we promote your product a million times but no one clicks it – you don’t pay anything.
  • You can set up the total budget for your campaign or choose a daily budget.
  •  You can stop or update the campaign or budget at any time.

 While some campaigns might be instant big winners, others might start slow and then pick up after the first few weeks and become even bigger winners.


7. How do I determine what bid I should offer?

Sponsored Products uses a CPC (cost per click), auction-based pricing model, where you and other advertisers bid for getting the best spots in the store for your products.

You set the maximum amount that you are willing to pay when a shopper clicks an ad for your product. The more competitive your bid is, the more likely your ad will be displayed when a shopper searches for a product that you are selling,

If the category is crowded and there are other advertisers who bid with you for more shelf space or if the promoted products are expensive – the average CPC usually goes up and vice versa.

The price you pay for each click is not the price that you offered but the price that the second higher bidder offered so if you offered 1.5 euros per click and the 2nd highest bidder offered 0.95 euros, you will pay 0.95 euros per click.

When you launch the campaign you see the average CPC in similar campaigns. This can give you a good benchmark. You can also see the minimum CPC which is determined by the retailers.

If this is your first campaign we suggest you start with the CPC you are used to in other channels (let’s say Google) and adjust it based on the results, especially in terms of the ROAS.

If the conversion is good and you see that the people who click the sponsored product ads and enter your product page are buying your product, but you are not achieving your budget, you should try to raise the CPC and get more clicks.


Ready to move on? Let’g go to part 3