CANOPY Management Skyrockets RoAS from 280% To 719% – A Partner’s Story
This New CANOPY Management Partner Has Also Averaged a Sales Increase of 15% Every Single Month. Find Out How We Can Do This for You!
- Amazon Advertising
- Selling On Amazon
I’m pretty certain that Amazon customers don’t know (or care) what type of seller account was behind their recent purchase. They’re shopping for a product and simply want it delivered as soon as possible.
However, Amazon buyers are often buying from two very different selling platforms, Amazon’s Vendor Central, and Seller Central.
The main difference between Vendor Central and Seller Central is who is selling those products. With Seller Central, (probably using the Fulfillment by Amazon (FBA) platform), sales are made directly to Amazon shoppers.
On the other hand, Amazon Vendor Central is an invite-only portal created to allow manufacturers and customers to connect. In this platform, Amazon is functioning as the distributor or middleman. Referred to as 1P (or first party), this means that participants sell their products directly to Amazon. Amazon then turns around and sells those products to customers. The sellers’ primary responsibility is fulfilling purchase orders (PO) sent by Amazon then shipping them the products.
This CANOPY Partner Wanted to Take a Big Step
One of the biggest ecommerce challenges that a recent CANOPY Management partner faced was actually taking the big step of LEAVING Amazon’s Vendor Central selling platform. Between the ability to seamlessly transact such large quantities and Amazon’s quick payment terms, departing what had been a profitable business model was not easy.
Still, for an Amazon partner selling through Vendor Central, it’s like a dance performance where the seller needs TO FOLLOW Amazon’s lead. Amazon decides when it’s time to increase the size of your orders. Scaling the business is out of the seller’s hands.
For this new CANOPY Management partner, that wasn’t working. They wanted more control over their business trajectory and reached out to the team at CANOPY to help them navigate the transition.
(Because this partner is selling in a competitive niche, I’m redacting their name in this case study)
Any time that an already-established business makes a significant move like this, there are going to be guilty parties. In this case, there were two; Amazon itself, and CANOPY Management.
Amazon was “guilty” because of the relentless improvements they have made to the Seller Central platform. Now, Amazon sellers using Seller Central can take advantage of many of the creative and advertising benefits that had once been the domain of Vendor Central.
CANOPY Management was found “guilty” because of its proven processes and tactics, well-trained team, expert analysis, and proprietary technology.
After the partner reached out to CANOPY, our initial audit found that their Amazon advertising lacked sufficient structure, a modern, healthy mix of ad placements, and ultimately, a well-calibrated marketing target.
The partner came to CANOPY with the goal of drilling down to better understand their customer base. That’s one place where CANOPY’s belief in treating our “clients” as “partners” really made a difference. We’re determined to make sure that our partners become the heroes of their own story.
By pulling back the curtain and exposing inefficient advertising campaigns in order to reveal sales and profit growth opportunities, we’re able to work together with our partners to engineer the best possible path forward.
As the new partner struggled to make the move from Amazon Marketing Services to Seller Central, their Advertising Cost of Sales was averaging 36%. Their goal was to transition to Seller Central while maintaining consistent sales growth, control ad spend, lower their Advertising Cost of Sales, and finally, dominate the Amazon categories that they sell in.
At the top of their wish list was more control over product pricing, inventory management and product launches. They also understood that they lacked an emotional “handshake” with their end users that would help inform their advertising campaigns.
On February 8, 2022, the decision was made to reach out to CANOPY Management.
CANOPY’s Pay per Click advertising experts have found that when it comes to competitive product niches, Amazon advertising not only provides the best, “let’s roll up our sleeves and see what’s really happening” insight into a partners’ target audience, it also offers the best value at any level of ecommerce ad campaign investment.
A first step that CANOPY always takes is to make sure that we’re completely aligned with our partners when it comes to their desired outcome.
The Partner’s Wishlist:
- Growth in overall sales and Sponsored sales
- Dominate the categories
- Consistently optimize ad campaigns to achieve optimum spend-to-sales performance
- Run and optimize ads for products that have not yet been promoted
- Lower (then maintain) Advertising Cost of Sales under 20%
How CANOPY Management Solved the Problem
CANOPY Management was determined to structure a full-funnel strategy, taking advantage of Amazon Sponsored Products, Sponsored Brands, and Sponsored Display. That helped CANOPY expand the product visibility to a much wider range of potential customers, both sponsored and organic.
That first step required a detailed, in-depth analytical investigation of the partner’s competitive landscape in order to fully capitalize on the knowledge gained from the advertising investment.
CANOPY took the following steps:
- CANOPY conducted extensive keyword research to identify lesser-known, highly-converting search terms
- Creating a solid ad platform structure for each product group, CANOPY niched down for every product (even including size as a factor)
- Utilizing Amazon’s latest beta, bulk 2.0, CANOPY’s advertising team was able to automate the sometimes tedious campaign creation process to make sure every corner of the advertising map was covered. (CANOPY gained extensive knowledge of the New spreadsheet format while working with the Amazon Bulksheets 2.0 Pilot program during the last year)
- CANOPY established a Master Portfolio for pivotal product groups that made it easier (for Amazon) to decide what to show to shoppers
- To gain more control over product groups and eliminate wasted ad spend, CANOPY developed an Alpha/Beta testing structure for every one of the partner’s products.
- In order to take full advantage of Amazon’s ad real estate, CANOPY implemented the full range of Amazon’s advertising platforms. Amazon Sponsored Products, Sponsored Brands, and Sponsored Display were all used.
The results were almost instantaneous. In the very first month . . .
RoAS (Return on Ad Spend) Skyrockets from 280% to 719%
Since February 8, 2022 when CANOPY began managing the new partner’s account, CANOPY has skyrocketed their overall profitability from an existing average Return On Ad Spend of 280% to 719% in the very first month. As indicated in the screenshot below, CANOPY went on to average 680% on Return On Ad Spend.
Sales Increase of 30% in the First Month and . . . an average increase of 15% each month since!
Not only did sales increase by almost 30% in the first month, the new partner has averaged a Month Over Month sales increase of between 10% to 20% every month since.
Amazon Advertising spend has functioned as the engine of their success and it’s still growing. Below, you can see that they increased their Amazon advertising spend 47% in the first month and have continued to boost their spend between 20% and 30%, month-over-month each successive month since that time.
One month before partnering with Canopy Management, the partner’s sales had plateaued at $72,000.00 with Advertising Cost of Sales of 36%. After CANOPY’s extensive restructuring of the advertising campaign, sales more than doubled to $158,000.00 and Advertising Cost of Sales plummeted to 14%.
Winning Amazon Choice badges is always a good sign that Amazon sellers are heading in the right direction. CANOPY very quickly helped the partner to dominate the categories that refer back to key terms that were previously identified.
At the present time, as shown below, CANOPY’s new partner has earned Amazon’s Best Seller badges for their pivotal products.
A “Rising Tide” of Ecommerce Success
More importantly, as the series of screenshots below show, CANOPY’s advertising team was excited to see that the “rising tide” was driving sales and pulling the remainder of the partner’s product catalog towards the top of Amazon’s first page as well.
Notice a trend in the above screenshots? One of the best things about establishing powerful sales momentum for your principal ASINs is that kind of success doesn’t happen in a vacuum.
In many cases (like this one), your entire Amazon business will benefit!
At CANOPY Management, we celebrate the partnerships that we’ve established with our agency clients. However, what’s become more evident as time goes by is that these partnerships are not simply between CANOPY’s marketing and advertising teams and our clients. Instead, the partnerships are a three-way affair.
The power and precision of Amazon’s extensive ad platform is a key element of our success. Amazon Pay Per Click advertising helps us to throw the widest marketing net possible, while at the same time, the platform’s precision allows us to refine our partners’ ad spend in an effective, money-saving way.
How CANOPY Management Can Help
CANOPY Management is a “full service” marketing agency for Amazon sellers, and our team consists of former Amazonians, multi-million dollar sellers, and award-winning experts. When you consider the ways in which CANOPY Management is able to help you grow your Amazon business, you’ll know why.
- Strategic Growth Planning
- Listing Copywriting Optimization
- Listing Photography
- Product Videography
- Advertising Management
- Customer Service
- Demand Side Platform (Amazon DSP)
- Amazon Posts
- Full Service Management
- Amazon Review Aggregation
Are you looking to expand your income stream, or transition away from your primary career? It’s a new year and with the growth of ecommerce, now is a great time to reap some benefits yourself!