Cost Per Order, delivery areas and the largest Amazon market: Three things I learned from the Amazon Sales Kongress
I’ve just returned from Amazon Sales Kongress, the twice-a-year Berlin event that’s a highlight in the calendar for the very large Amazon market. Major brands, vendors and sellers, and agencies meet up to share the latest learnings and their own experience in an informal and open way.
I had the great pleasure of presenting the potential benefits of selling as a Vendor on Amazon, but I also saw many awesome speakers — other brands and fellow Amazon experts.
So here are three gems I learned from them during the conference.
- Goodbye ACoS — hello CPO
ACoS on Amazon advertising is the “advertising cost of sale” — basically how much you have spent to get a sale. You divide your ad spend amount by the sales amount (in value). It works a bit like a discount. An ACoS of 20% is the same as giving a discount of 20% on your products. In this case, for every euro spent you generate 5€ of sales.
Some brands focus solely on ACoS and only follow this KPI. Speaker Ronny Marx did a great job showing that if you focus solely on this metric you can actually lose a lot in total sales — so overall, losing profit.
He went further and introduced another metric, the CPO — Cost Per Order. He recommended dividing the ad spend value by the quantity of total items sold. So a CPO of 10€ means for each product you sold you funded 10€.
Checking that metric on top of ACoS, you might find out your ad spend is becoming more efficient, but that on your total spend you actually are paying more per item.
2. Amazon.de is the most international market
Talking of SEO optimisation, we are always looking for the way to capture the most possible relevant keywords.
Maik Busch from KW Commerce did a great job showing that in Germany, one third of the total number of keywords are in English! This is due to the fact that many Eastern Europeans and also North Europeans shop on Amazon.de. Therefore a lot of searches are done in English.
This means brands need to make sure they include relevant English keywords in either titles (at the end for example), or more conveniently, in backend keywords or in bullet points.
But be careful — the English keywords used on Amazon.de might be different to the ones used on Amazon.co.uk, so you’ll have to make sure you make the research for Amazon.de.
3. Choosing a delivery area might influence your ‘searchability’
This one is for sellers. Denny Kühne from Shirtracer GmbH (a seller producing t-shirts with more than 6 million SKUs on Amazon) did a brilliant job explaining a lot of the tricks he has been using.
Two of them got my attention. The first one is linked to the delivery area you select as a seller when you do FBM (i.e. when you handle the delivery). He found out that if he did not select Austria, for example, his product would not show up on some searches, whereas if he had selected it, then his product would show up. This means if you don’t do FBA and you are in FBM you might want to test that.
The second thing is that for a single ASIN you can have multiple SKU numbers. In fact, for one given ASIN, you can have three different SKUs:
- One in FBA
- One in FBM Prime
- One in FBM (non Prime)
Strangely in some cases, FBM non Prime is delivered quicker than FBM Prime! This strategy enables you to use all possible options — making sure your product will appear on searches in any cases.