A couple of weeks ago, I went into a grocery store to buy my mom flowers for Valentine’s Day. Flowers were the only item on my mental shopping list.
As I rounded out of the flower aisle, a bouquet of pink roses in the arm, I saw a display featuring chocolates, teddy bears, and goofy cards. After surveying my options, I selected a card to purchase too.
Has this ever happened to you? You enter a store with intentions of buying just one thing yet you leave with many things? I’m willing to bet that it has and that it’s happened more than once.
Shoppers enter stores wanting to spend the minimum amount of their money, and stores are strategically structured to convince shoppers to spend their maximum.
The same can be said for Amazon. And as an Amazon seller, you should take advantage of this.
Welcome to part two of our four part mini-series all about Amazon Advertising Brand Analytics!
Last week we covered its Search Terms report tool, and in the coming weeks we’ll explore Item Comparison and Alternate Purchase Behavior and Demographics. The article you’re about to read and enjoy, however, regards Market Basket Analysis.
First we’ll cover important lingo and theories relevant to Market Basket Analysis and then, when you’re up to speed on all the nitty-gritty, we’ll offer six straightforward steps to use paid traffic to gain maximum organic traffic.
Important Disclaimer: The information in this article is only relevant to registered brands on Amazon. If you’d like access to this tool, apply for Amazon Brand Registry.
Neat-o! Let’s learn, fellow Amazon Sellers.
What exactly is Market Basket Analysis?
If a person has an affinity for another person that means they have a certain rapport and liking for each other.
When stuff shares an affinity, however, it means the stuff has similar characteristics or somehow complement each other. This is relevant because Market Basket Analysis is a component of affinity analysis.
Affinity analysis is a data analysis and data mining technique that discovers relationships between items. Google Adwords, Youtube, and retailers like Amazon, use affinity analysis to perform Market Basket Analysis.
In simpler words, Market Basket Analysis strives to understand shopper’s purchase behavior and then uses this information to cross-sell and up-sell relevant items.
Market Basket Analysis is the study of bundling.
Amazon studies shoppers who view and purchase two complementary items.
Let’s say someone puts a yoga mat in their Amazon shopping cart and then scrolls down the page to browse the Frequently Bought Together row. There they might see yoga towels or dumbbells or resistance bands. These recommendations are not to be confused with display ads or search ads.
The shopper wasn’t necessarily searching for those products, but upon seeing them, they might remember, oh yeah, they do need a fresh yoga towel to replace their ratty one.
That yoga towel and dumbbells are not sponsored products; they are products determined by Amazon’s Market Basket Analysis as typically relevant to the average yoga mat shopper. The yoga towel is a complementary Amazon product.
To view your Market Basket Analysis, peruse your Market Basket Report in Seller Central.
The Market Basket Report displays the top three products most frequently purchased at the same time as the Brand Owner’s products, along with the percentage of time each of the top three products were purchased with the Brand Owner’s products during the reporting range selected by the user.
How can an Amazon Seller Take Advantage of this opportunity?
Amazon sellers can request quarterly, monthly, weekly, or daily reporting timeframes to view the Market Basket Report. If you’re curious which report to study, we always recommend beginning with as much data as possible.
The Market Basket Report displays all of your ASINs for the selected timeframe and shows which three products were most frequently bundled with your other products.
The Market Basket Report does not, however, explain how those frequently bundled products arrived in the same shopping cart. There is no way to know if a shopper purposely and knowingly searched and purchased the two items or if it was mere coincidence.
All we know is the combination percentage, which, according to Amazon, is the percentage of orders that contain both your product and the number-one purchased product in comparison to the total number of orders that contained at least two different items, including your product.
I’ll let my Badger buddy, Stephen, explain this in layman’s terms.
Most people wouldn’t naturally think to buy a Bluetooth speaker if the only other item on their list was toilet paper. Those two products are distinct and separate from each other.
The Market Basket Report shows all the products associated with brands the Brand Owner has successfully registered with the Brand Registry. Products not associated with the brand only show up in the report if they are one of the top three products purchased at the same time as one of the Brand Owner’s products.
A probable exception to the complementary product is in the case of consumables. Sometimes for consumables shoppers purchase similar products by different brands to determine which they prefer.
For example, I like birthday cake flavored protein bars, and I like trying that flavor by as many brands as possible; I frequently bundle similar products by rival companies in my cart.
However, it’s most likely not common that your Market Basket Report will determine your product is most frequently purchased alongside your competitor’s similar products. It’s more likely that Amazon will bundled your products with a complementary product. The product might be a competitor’s complementary product, but that’s a complementary product nonetheless. (This tidbit will be covered more in-depth in part three of our Brand Analytics mini-series.)
While we’re on the topic of competitor’s, no, you cannot search the Market Basket Report for products that are not yours.
Now that you’re aware how golden the Frequently Bought Together spot is, don’t you want to know our strategy for using paid traffic to garner a lifetime value of free advertisement in this coveted spot?
Say no more.
6 Simple Steps to Maximize Market Basket Report Data Return for Amazon Sellers
To win the Frequently Bought Together spot– the free, golden, shimmery, glittery, wonderful, highly coveted spot– on a product page, use your Market Basket Report.
We want your product in shopping carts with another specific product as often as possible, and you will achieve this with product targeting and a unique “product page only” campaign.
Do this in six simple steps.
- Step 1: Create a manual sponsored product ads campaign.
- Step 2: Create a product targeting an ad group.
- Step 3: Enter ASINs as product targets.
- Step 4: Bid low on product targets to reduce search impressions.
- Step 5: Increase bids on product landing pages targeting in campaign setting.
- Step 6: Repeat steps 3-5 monthly.
If those steps seem dubious, allow me to clarify the concept.
Step 1: Create a manual sponsored product campaign.
This is where paid traffic comes into play. If you take into consideration that your sponsored products will upsell other products that aren’t being sponsored, Amazon PPC starts to make more sense.
You have done this before, right? It’s easy! Jump into the Campaign Manager and select Create Campaign.
Step 2: Create a product targeting an ad group.
After naming your campaign and giving it a budget, set up your first ad group. When given the option of choosing “keyword targeting” or “product targeting,” choose product targeting!
Step 3: Enter ASINs as product targets.
Browse your Market Basket Analysis for the ASINs that are frequently purchased with your product. These are solid leads for product targets.
Step 4: Bid low on product targets to reduce search impressions.
Our rationale for bidding very low on product targets is because we recommend an exaggeratedly high bid increase on the product page ad placement.
Increase bids on product page targeting in the campaign setting, not the ad group setting.
Step 5: Increase bids on product page targeting in campaign settings.
Keep in mind that the Adjust Bids by Placement feature is a campaign-level setting. This option does not exist for ad groups yet.
Bid low on the product target itself to reduce paid traffic. Go into placement settings and increase the bids on product page targeting to have a strong product page bid, but a very low search bid.
Our theory is that landing your ad on another product’s details page as often as possible will increase the chances of your item being bundled together in the same shopping cart. This gives you an opportunity to win a spot in the Frequently Bought Together section.
Where you target your ASIN, your product will appear near that ASIN on the same page. Product targeting is like stalking an ASIN wherever it goes, whether it’s on a search page or a product details page. Browsing is like scrolling to the bottom of search on a product details page.
If you target a competitor’s ASIN, possible search terms that could qualify your product would be generic search terms or branded keywords to appear on the page. If you target their ASIN, you’ll appear on that page.
Your CPCs, or cost per clicks, are determined by how relevant Amazon considers your product to that search query. If you sell bananas and you target avocados, Amazon might not think the banana is a relevant search term for an avocado and therefore will charge you higher CPCs than the avocado.
Ad placements in the search results page can get expensive quickly! This is why we target the avocado’s product page for ad placement, where CPCs are more affordable.
If you’re the banana and you target avocadoes, you also run the risk of having low conversion rates. You might spend a lot of money to show up on the search page but customers won’t necessarily find your product relevant or compatible.
If you appear on the product pages, however, odds are that your CPCs will be lower because Amazon will consider your product relevant to the other product, regardless if you’re related to the search.
Another issue with bundling with a specific avocado is that some shoppers might prefer bundling their bananas with a different avocado ASIN. If they click on a different avocado, your banana will be on a different page and it’ll miss the bundling option.
Step 6: Repeat steps 3-5 monthly.
Simple as that! Add this strategy to your monthly task list and you’ll be one your way to growing mountains of revenue.
Once you complete steps one through five, schedule a time once a month to study your Market Basket Analysis.
You can even opt to get this report sent to you on a monthly basis to see if there are new ASINs that people regularly buy with your products.
Do this monthly to build a list of frequently purchased pairs to get as many clicks and conversions for the duo as possible. Do this often enough and eventually your products will appear as a related item.
With sufficient paid traffic, theoretically a product will organically appear on a product page to maximize visibility for the sake of a customer’s lifetime value.
Bundle like a boss.
Just like the flowers and the I Love You, Mom card from the grocery store, soon your Amazon store will cross-sell, up-sell, and bundle galore to shoppers everywhere.
- Market Basket Analysis is the study of bundling.
- The Market Basket Report displays the top three products most frequently purchased at the same time as the Brand Owner’s products.
- The combination percentage is how often your products are bundled.
- Browse your Market Basket Analysis for the ASINs that are frequently purchased with your product.
- Create a manual sponsored product campaign and then a product targeting ad group where you will enter ASINs as product targets.
- Bid low on product targets to reduce search impressions and increase bids on product page targeting in campaign settings.
Market Basket Analysis is Amazon’s equivalence of setting items to eye level for buy level and you can use our strategy of six simple steps to maximize a customer’s lifetime value. There is no shame in the paid traffic game, especially when the goal is to use paid traffic to maximize organic traffic.
If you test our strategy and have questions or feedback, please leave a comment. We are very accessible, and we love sharing ideas! As always, thanks for being our Badger buddies.
Discover Us on our PPC Den Podcast
If you enjoy supplementing your long reads with audio, we cover this topic on our podcast as well.
Listen to it in the episode below or find us on your favorite streaming platform, like Apple, Google, Spotify, and more!
- 02:20 Intro
- 05:14 What is Market Basket Analysis?
- 08:50 What is Market Basket Report?
- 15:14 6 steps to maximize data return from Market Basket Analysis
- 23:50 On Product Targeting campaigns
- 27:10 Farewell, Badger friends!
Watch Mike & Stephen on YouTube
If you enjoy supplementing your long reads with video, well, hot diggity dog, you’re in luck! We cover this topic on our YouTube channel too.
Watch it below and please don’t forget to ‘like’ and subscribe.