The Final Result
We successfully reversed a 14-month negative sales trajectory. We went from an average negative 41% year-over-year decline in Total Retail Sales to a 7% positive growth figure by the third month of our engagement, with Ad spend decreasing by 8% compared to the same time period in the previous year. So we did this even though we spent less in ad spend. We were able to turn the ship around with the same resources at our disposal, setting the client up for success.
In February 2023, Ashman Online, a brand in the Home Improvement, Tools and Gardening category, partnered with Laser Sight Digital. Ashman wanted a seasoned team to take over their Amazon Advertising efforts so they could regain the territory they lost in the last 14 months prior to the engagement, and grow sales on Amazon over time. Unfortunately, they had been experiencing negative sales growth for the past 14 months in a row prior to connecting with Laser Sight Digital.
Retail sales were shrinking, and actions needed to be taken fast. In this case study, we dive into how Laser Sight Digital leveraged its knowledge and expertise to create and implement a granular campaign structure and strategy that led to successfully pulling off a huge course correction.
We audited the existing campaigns and calculated ratios between different match types and ad products. Sponsored Products received around 90% of the ad spend historically, with very little ASIN Targeting. It was then made as clear as day that Ashman was relying mostly on keywords and on limited places, not all ad products were being taken advantage of, allowing competitors to capture remaining ad placements.
We needed to drive Brand Defense, up our game in Sponsored Brands, and test Sponsored Display. We also needed to adjust budgets and ads to fluctuating inventory levels due to manufacturing and shipping reasons.
We decided to implement an always-on advertising strategy to maximize sales during all hours of the day and fully accelerate the flywheel.
After conducting thorough targeting research, we created a granular, full-funnel campaign launch. We needed to test those placements that were previously never tested, have an evergreen set of campaigns that would allow us to remain profitable, and scale month-over-month. Talk about multiple goals! We tackled this in different ways:
- We diversified ad types and match types as well as leveraging new keywords and ASIN targets.
- Ashman’s catalog featured a healthy amount of product variations and bundled products, so we updated the selection of Advertised ASINs. We wanted to give all product variations a fighting chance, and some of them were not thoroughly tested before.
- There was a wide range of product offerings with diverse price points, and we allocated more ad spend on higher ticket items or items with more profit margin to help increase the client’s bottom line and not just top-line revenue.
- We got our hands on a healthy collection of lifestyle images and videos, which we leveraged in Sponsored Brands, helping boost brand awareness and consideration.
During the first 3 months, the ad spend budget was almost identical to the same period in the previous year (we actually spent just $16 more). However, the results were vastly different.
Month 1 was a transition month. It was all about launching our strategy, putting in the hard work, ramping up campaigns, and testing new ad placements and targets. However, the RoAS average remained steady despite the changes going on in the ad account, and Average Order Value increased by 10% year-over-year (from $41 to $45) as we started allocating budgets strategically.
However, in Month 2, we really started turning the ship around. As we started implementing efficiency changes on the campaigns, RoAS saw a 10% improvement compared to Month 1, and a 5% improvement year-over-year. Sales started to lift across the board.
During Month 3, products started selling a lot more quickly than anticipated and inventory levels were thinning. RoAS improved by 17% compared to Month 2, and 16% year-over-year from the same month last year. Average CPC decreased by 21% compared to the same month in the previous year and Ad Sales increased by 21% YoY (+$50,000). Total Retail Sales increased by 7% YoY (+$34,000). The flywheel definitely started to spin faster and this is how we were able to help the client achieve their first positive sales growth month in over 14 months. We turned around the ship for this client and we can do the same for you. We realize margins are shrinking and ad costs are increasing, so please reach out to us if you’re interested in learning more about how we can do something similar for you and turn the ship around for your Amazon channel.