Why Managing Amazon PPC in Real Time is a Bad Idea
There are two time delays to consider when managing your PPC:
- How long it takes to attribute a sale to a click
- How long it takes for that data to show up in your analysis
We’re going to cover both of these here so that you can make the right decisions about how to manage your Amazon advertising account.
Amazon PPC advertising – as does most online advertising – heavily relies on the concept of attribution windows. An attribution window, simply put, is the amount of time between a click and a sale that gets attributed to that click. Amazon uses different attribution windows for different advertising products (like Sponsored Products or Sponsored Brands), but most products focus on the 7 day or 14 day attribution window. If a click occurs on an ad on Monday, but the sale doesn’t occur until Friday, the sale will be attributed to the click from Monday.
This also means that the date to which the sale will be applied will be Monday’s date, not Friday’s. So on Friday (actually probably on Saturday or Sunday when the sales data is available), a sale will be added to Monday’s data, thus possibly significantly changing how you interpret the Amazon PPC data for Monday – 5 to 7 days later! Because attribution windows are an integral part of Amazon PPC (and the standard range shown in the Advertising Console and Seller Central is from 7 to 14 days), you’re not getting a full picture of your Amazon PPC until at least a few days after the date in question even if the click and impression data had already appeared in your dashboards.
But how common are delayed sales? Turns out, pretty common. Around 1 in 5 conversions happen after the first day:
This chart shows how 80% of conversions occur on the first day after a click. This seems like a lot, but if you’re managing your PPC in real time, you could be making decisions without taking into account up to 20% of your conversions. This is a huge chunk of data to ignore. Even by 7 days, only 95% of the conversions are accounted for. This really shows that waiting a couple days at least, and looking at much longer date ranges (typically 14 to 30 days) is going to give you a much better picture of your real performance.
The most important takeaway here is that if you’re making bid updates every day or multiple times per day, you necessarily have to use data from several days ago. That’s your only option and it’s not a great one! Waiting a few days for customers to convert and the data to come in gives you a much more accurate representation of a target’s performance and will let you make a better bid update. This is at the core of how we’ve structured Prestozon’s algorithm.
Another interesting note on this chart: Notice how the share of 1 Day attributions drop before the holidays, spike on Black Friday and Cyber Monday, and then ramp up as you get close to the last ship dates. This is a clear indication of people waiting for discounts during the holiday season and then panic buying at the end. Data is so cool!
Prestozon utilizes the Amazon Advertising API in order to source the data from your Amazon account to drive our analytics and optimization efforts. This connection is very powerful, but it does come with certain limitations. The most visible limitation regarding the Amazon Advertising API is the time delay between when Amazon displays its data and when that data is sent to Prestozon over the API. Part of this delay is just the necessary nature of additional steps in a data transfer workflow, but there are other APIs in the world that do transfer data in almost real-time. Amazon did not choose to structure their API as a real-time data stream. While this decision seems to be much to the chagrin of many Amazon PPC Account Managers, this was a conscious decision on Amazon’s part and is a limitation all PPC tool providers need to consider when designing their applications.
In addition to this delay, Amazon only guarantees accurate attribution after 12 hours (both in the API and Advertising Console), so make sure to take any data within the last 12 hours (especially sales and order data) with a grain of salt. Prestozon pulls reports for the day that ended 24 hours ago every morning. This provides you with the most up to date accurate information possible, without displaying anything that could be misleading.
In software development, there are many reasons to add limitations to features. Sometimes there are technical restrictions or functionality conflicts, but sometimes the function of a feature is intentionally limited to nudge user behavior in a particular direction. In the instance of the Amazon Advertising API, trying to manage Amazon PPC advertising in real-time as data comes available is generally bad practice. The metrics behind Amazon PPC explicitly cover larger time frames than hours or even days and so account managers need to have a longer field of view when managing their PPC.
These are Advertising Console limitations too
It’s important to note that some of these limitations don’t just affect the API – they are also present in the Amazon.com Seller Central and Advertising Console interfaces! The same back end provides the data to both so there’s a delay between a sale being made and it is attributed to a click there as well. How Prestozon interacts with the API and how Amazon handles the data for their own dashboards differ, so the delays aren’t going to be exactly the same in each location (and thus the data may be different during the most recent couple days), but discrepancies exist in both places nonetheless. Beyond that, these interfaces and the API don’t surface any timestamp data that would afford intraday analyses or SLAs regarding the submission of a change and the time it takes effect. The data simply isn’t there to make intelligent decisions about customer behavior based on time of day (This is why we currently shy away from offering dayparting in the platform – the data needed to do it properly just isn’t there).
Delay of Action
While you can make a change in a third-party integrator like Prestozon or in the Amazon dashboard and that change (such as a bid change) will be displayed almost immediately in the UI, there is no guarantee when that change will subsequently be pushed into the actual Amazon Marketplace environment. Amazon gives no indication how quickly bid or other parameter changes propagate through the full Amazon ecosystem. Because of this, making hairpin turns in your Amazon PPC strategies may add a lot of noise to your data that isn’t possible to extract signal from.
Take a longer-term approach
As the Head of Ad Strategy for Prestozon, I’m in accounts all day, every day; I almost never look at date ranges less than two weeks and prefer to look at 30 days whenever possible. Anything less just isn’t giving me the volume of data I need to make informed suggestions about improving account performance. Additionally, Prestozon’s algorithm won’t make daily bid changes – and not because we wouldn’t prefer to make faster bid changes. There just isn’t going to be enough data to make a bid decision after one day, never mind less than that. Making bid changes faster than that is a lot of motion without meaningful data behind it.
- What is Amazon Advertising? - October 28, 2020
- AMZ Pathfinder and Prestozon improve ad campaigns for toy maker - October 15, 2020
- Why Managing Amazon PPC in Real Time is a Bad Idea - July 9, 2020