Amazon PPC: AI vs. Rules-based Automation (Which is best for my business?)

Introduction

As more advertisers look to third-party tools to help them improve their Amazon Advertising performance, increasing demand in the market has been met with various Amazon optimization platforms offering a growing selection of automation capabilities for brands and agencies.

Artificial Intelligence (AI) automation for Amazon Advertising is perhaps the most sought after offering in the market, where the advertiser can rely on the machine-learning software to make automated bid and keyword changes on their behalf, enabling them to scale and optimize the performance of all their Sponsored Product campaigns — without the need for manual intervention.

While AI-based automation is a very powerful solution for Amazon advertisers looking for a “set it and forget it” tool, this popular offering may not always be the best solution for advertisers who require more control and flexibility over how their keyword and bid changes are strategized and executed. In such a scenario, using a rules-based automation tool for Amazon PPC that enables the advertiser to define the criteria (and retain the decision-making) for how their automation rules are triggered would actually be more suitable for the advertiser.

Additionally, if you are looking for an automation tool to help you save time and improve your Amazon Advertising performance, it will be important to understand the differences between AI vs. rules-based automation tools available on the market. Below we will look at the unique benefits of each, and help you to determine the right solution for your business needs that can help you maximize your Amazon Advertising ROI.

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How does Amazon PPC AI automation work?

Sellics’ AI-based automation for Amazon PPC takes away the complexity of automating Sponsored Product campaigns. The advertiser only needs to input a few parameters (target ACoS, budget, etc) and let the machine-learning software take care of the rest.

Of course, how the machine-learning algorithm runs in the background to determine when to make changes to your bids is slightly more complex. At Sellics, our Amazon PPC AI tool ‘Autopilot’ analyzes a large volume of data and utilizes clustering and forecasting models to determine when to make bid changes based on the predicted revenue per click.

AI automation for Amazon PPC is generally very powerful for optimizing bids for keywords with high search volume (‘short-tail keywords’), as the machine-learning algorithm has plenty of search data to recognize patterns and identify keywords generating the most conversions — and can optimize your bids accordingly to maximize spend efficiency.

Furthermore, if done right, AI can even optimize long tail keywords - which is hard to do with rules-based automation, or poorly developed AI automation tools. This is very powerful, as long-tail keywords can be very lucrative for the advertiser — the conversion rate is typically higher for long-tail keywords as you are targeting shoppers that have displayed specific search intent signaling their desire to buy.

Although the search volume is low for these keywords, so is the competition, which means it would not be very costly to ensure you outbid your competitors and gain maximum visibility for your long-tail keywords.

At Sellics, we’re proud to share that our AI automation tool ‘Autopilot’ is able to automate bids even for long-tail keywords, by observing the performance of similar performing keywords (using our clustering algorithmic modeling) and making bid changes accordingly based on their predicted revenue per click.

Autopilot is currently only available for pre-selected Sellics users, you can register for our Early Access program at the end of this article

Autopilot is currently only available for pre-selected Sellics users, you can register for our Early Access program at the end of this article

In summary, the biggest advantage of using an AI automation tool for Amazon PPC is that it offers advertisers a fully hands-off solution for managing their Sponsored Product campaigns. With AI-based automation, you would outsource the decision-making to the AI — the software will decide when to make changes to your bids and keywords, by taking various data signals (historical performance, forecasted revenue, seasonality, etc) to determine when to make performance-based changes to your campaigns.

How does Amazon PPC rules-based automation work?

With rules-based automation for Amazon PPC, as an advertiser you set the rules that define your bid and keyword parameters, and you let the algorithm execute the changes once your conditions have been met. In contrast to AI automation, with rules-based automation you would retain the manual decision-making for changes made to your campaigns, by defining the “IF/THEN” rules that would trigger bid and keyword changes.

Bid Automation example:

An example of your bid automation rule may be: IF ACoS is less than target ACoS 20% after 20 clicks, THEN increase bid by 30%. The rules-based automation tool will only trigger changes to your bids and keywords based on your pre-defined “IF/THEN” rules:

Keyword Automation example:

An example of your Keyword Automation rule may be: IF Broad keyword generates orders >1 after 1x Clicks THEN move keyword to Exact ad group:

How many automation rules you wish to set up for your Amazon PPC campaigns can be as simple or complex as you require. At Sellics we have our recommended best practice rule-sets, and you can also read our ‘Beginner’s guide to PPC automation' to get an idea of how to setup automation rules for your Sponsored Product campaigns.

This means that for Amazon advertisers who require a high degree of control over their Sponsored Product campaigns, and want the freedom to test and deploy different automation strategies, you may find that a rules-based automation tool for Amazon PPC is more suitable for your needs.

Which automation tool will drive maximum results for my Amazon PPC advertising?

There are several important factors to consider when determining which automation tool will best suit your advertising needs on Amazon. Key factors will include the size of your advertising budget, the experience level of the team members managing your Amazon Advertising account, and the degree of control they wish to have over the automation tool.

Below we’ve created a table comparing the benefits and knowledge requirements for advertisers interested in either AI or rules-based automation for Amazon PPC:

From the table above you can see that there are several important factors to consider when selecting the most suitable automation tool for your advertising needs on Amazon. If you are a brand or agency that is managing a large advertising budget on Amazon, we would generally recommend that you take advantage of our AI automation tool, as it takes away the need for rules-based settings, which can be complex and time-consuming to map for large advertising portfolios.

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