Is It Profitable to Advertise Black Friday Weekend?

Looking at our stats over the month of November, I can see there was a definite boost in traffic during Black Friday weekend. I wanted to tackle the question: Is it profitable to advertise on Black Friday weekend?

We know that paid traffic is competitive on Facebook and Google and usually ends up being a lot more expensive. Salesforce even says, “For advertisers looking to reach their audiences and market their products, holiday shopping historically results in increased media costs as more advertisers bid on a relatively fixed amount of inventory which is based on Facebook usage. Facebook in both 2014 and 2015 follows this trend, with U.S. media costs of an index of Social.com customers rising a full 98%, from $4.30 to $8.86 Cost Per 1,000 Impressions (CPM), between the start of November and Cyber Monday. This sharp increase matches a similar 70% increase in 2014.”

Another Black Friday has come and gone, proving to be the busiest shopping day of the year. Online shoppers spent a whopping $5.03 billion the day after Thanksgiving with the average order price sitting at $135. Amazon dominated Black Friday, taking between 45 to 50 percent of all online sales, making $1 billion in 24 hours. But the real winner was Cyber Monday, becoming the largest online shopping day in U.S. history, making $6.59 billion this year. With all this traffic during Black Friday and the holiday season, Amazon has become a jungle for Amazon sellers.

Our customers sell everything from sunglasses to picture frames. Throughout this article, sellers will have access to the metrics that represent them, such as Conversion Rates, Cost per Click, and ACoS.

Because this post is so chart heavy, I’m going to include really happy people with Amazon boxes, accompanied with a fact about Amazon. Did you know Cyber Monday sales increased 16.8 percent from a year ago?

This Post is Meant to Help Your Amazon PPC Strategy by Providing Benchmarks

It is! I promise, but I can’t continue with this post without context. I’m going to talk a little bit about our Amazon PPC software and how it helps our customers.

In this post, I’m going to compare some stats about our users throughout November to provide insight for Amazon sellers about selling during the month of Black Friday and Cyber Monday. The results our users have may be a little better than what you’re used to seeing, but don’t be skeptical.

For example, I mentioned in my last post on Sponsored Products, that in Ad Badger’s first month, customers have seen a total of 940,438 clicks and 98,109 conversions, resulting in an average of 10.43% conversion rate for their Sponsored Product Ads.

I also mentioned Amazon’s PPC ads convert an average of 2-5x of Adwords, which have an average conversion rate of 1 to 3%. Our customers have a substantially high conversion rate, but that just means our product is working. I tear up bad keywords, replace them with profitable ones, manage your bidding so you can hit your target ACoS, improve your workflow, and all that good stuff. So, it makes sense that customers are seeing that high conversion rate.

Another reason their conversion rate is so high is that we specialize in Sponsored Product Ads. Sponsored Product Ads are the most popular ad on Amazon and follow the customer from the search results page to the product page. Customers who visit Amazon already pretty much know they’re going to buy something, hence the 74% conversion rate for Amazon Prime Members. Yes, I used the word hence.

In conclusion, our customers take a proactive approach to optimizing their Sponsored Product Ads and get a higher conversion rate because of it.

You may also see other metrics that seem great (or not so great), but the important thing to look at is the trends over the month of November and see how you can pair your overall Amazon PPC strategy with our data.

Lastly, we are a growing company and acquired new customers throughout November, so we will mostly be looking at metrics per user to get a better idea of trends. 

With all that being said, let’s look at some statistics, shall we?

Comparing Weeks in November

A table comparing Amazon PPC stats from Black Friday weekend vs the previous weekend

I’ll break it down for you.

I took a sample of Sponsored Product ads from November 17th to 20th and the 24th to 27th to see what effect Black Friday (11/24) had on the many metrics sellers look at.

The selling landscape is entirely different during these two weekends. During the weekend of November 17th to the 20th, customers are typically not shopping as much so they can wait for deals to roll in the following weekend. However, during Black Friday weekend, the increases in almost 3 million ad impressions, the click-through rate, and the conversion rate show customers were more active on Amazon.

The advertising cost of sellers increased, but not to worry, so did the sales. The cost per click the sellers paid each time a customer clicked on their ad, stayed about the same. This breaks down a common misconception that it’s more expensive to sell on Amazon during the Black Friday weekend and the sales just aren’t worth it. On top of that, the ACoS improved significantly, lowering to 27% the weekend of Black Friday.

Now let’s look at the rest of the month.

Conversion Rates in November

Average Conversion Rate Per User for Amazon Sponsored Products in November 2017

A chart showing the conversion rate percentage per user in November

Conversion rates are what Amazon PPC all about. It’s the metric that advertisers look at to know if their ad is working. The conversion rate is the percentage of ads that converted into sales. From first glance, this month’s conversion rates look all over the place.

Let’s take a closer look:

  • The average conversion rate per user during November was 9.2% per day per user.
  • Cyber Monday killed it with a conversion rate of 11.6% per day per user.
  • Thanksgiving day was the day with the lowest conversion rate of 7.4% per day per user.

Average Conversion Rates on Amazon for Black Friday and Cyber Monday

Putting these stats together, it proves Cyber Monday was a great day to advertise and Thanksgiving Day was the worst day to advertise. Customers didn’t buy as much on Thanksgiving Day because they were waiting for deals on Black Friday/Cyber Monday or because they were busy basting Thanksgiving turkeys, arguing with the in-laws about politics, and perfecting the spiked apple cider (as they should be).

In terms of Cyber Monday, there was a huge uptick in traffic and Ad Badger customers got their ads in front of customers to reach the high of 11.6%. I speculate November started off with a strong conversion rate because of it was just far enough away from Black Friday weekend to wait for great deals, prompting customers to buy products they needed quickly. Comparatively, Amazon sellers saw an overall dip in conversions from the 12th to the 26th because customers were waiting for deals to save money.

From November 1st through November 27th, $50 billion has been spent online, on track to reach $100 billion by 2018, said Adobe.

Cost Per Click in November

Average Cost Per Click Per User for Amazon Sponsored Products in November 2017

A chart showing the cost per click per user in November

The Cost Per Click (CPC) is the amount you pay when a customer clicks your ad. Remember that Amazon PPC is an auction and these CPC prices are equal or less than the highest bid a seller places on a keyword. Sellers want a low CPC to maximize the return they get on an ad.

Let’s take a closer look:

  • Sunday, November 5th was the day with the lowest CPC, hitting $.68.
  • Thanksgiving Day, November 19th, and Cyber Monday were runners-up, all equal at $.70.
  • November 2nd hit the highest CPC at $.78.
  • The average CPC for November was $.74, proving Black Friday and Cyber Monday’s CPC was lower than average.

Average CPC on Amazon Sponsored Products for Black Friday and Cyber Monday

The CPC is a huge metric for educating Amazon sellers.This data shows it’s worth bidding on these days because the CPC stays consistent and doesn’t go up. Meaning, with the CPC staying the same and the conversion rate being higher, the reward can be great. The middle of the month was the most expensive for Amazon sellers, probably because they wanted to gear up for Black Friday weekend and promote their products. Don’t be afraid to bid high on Black Friday and Cyber Monday next year folks.

Mobile sales reached $2 billion over a 24-hour period for the first time this Cyber Monday.

ACoS in November

Average ACoS Per User for Amazon Sponsored Products in November 2017A chart showing the ACoS per user in November

Advertising Cost of Sale (ACoS) is the total ad spend divided by total sales. If your ACoS is 25 percent, you’re spending a quarter on ads to make one dollar in sales. Our users ACoS generally trends upwards through November and dips the last few days.

Let’s take a closer look:

  • The lowest ACoS hit 21.9% on Cyber Monday
  • The highest ACoS hit 38.2% percent on Thanksgiving Day
  • The average ACoS of the first 10 days of November was 26.2% compared to 30% of the last 10 days

Average ACoS on Amazon Sponsored Products for Black Friday and Cyber Monday

It’s no secret by now that Thanksgiving Day was the worst day to advertise as it had the highest ACoS and lowest profit out of any day in November. Customers just weren’t shopping on Thanksgiving and waiting for the weekend to take advantage of deals. Comparatively, Cyber Monday won the award for best day in November to advertise with the lowest ACoS and the second highest profit.

So Was Black Friday Weekend Profitable for Amazon Sellers?

Yes. Data from Facebook ads show that advertisers are spending money on ads during Black Friday weekend because they are proven to work and increase their advertising revenue.But, our data shows it wasn’t as expensive as one might think. Conversion Rate and the ACoS improved during Black Friday weekend compared to the weekend before, but the CPC remained the same. This means that sellers can take advantage of the consistent CPC and bid higher to take advantage of the increase in traffic during Black Friday and Cyber Monday.

Next year, don’t be afraid to advertise on Black Friday weekend. It could reap big rewards.

Until next time.

Happy Holidays!

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