Focusing Ad Spend on High-Converting Variations We hold a firm data-backed belief, that in over 90% of cases, advertising only the top-performing variation is optimal, regardless of how many variations the parent ASIN has. In the competitive world of Amazon Ads, funneling ad spend into the right variations can significantly impact revenue & profitability. Focusing ad spend on the highest-converting product variation is key. After managing multiple accounts with over $1M ad spend monthly, we've honed this tactic, which we now call the Variation Race. Let's unpack this belief.

What is variation race?

1. The Problem

Diluted Ad Spend Across Variations Most brands run ads on all or most variations of a parent product, though not all variations perform equally. Why would you allocate ad spend to a variation with a 9% conversion rate, when there is another one within the same parent ASIN converting at 15%? By advertising only the top-performing variation, brands can better capitalize on high conversion rates. Additionally, while customers might have specific variations preferences, they are still free to choose once they reach your detail page. This tactic puts the variation they're most likely to buy front and center, while still giving them the option to choose another if they prefer. If then a lower-performing variation has keywords that directly match customer search terms, like 'red shirt' versus 'black shirt', we allow it to target those terms exclusively.

2. The Solution

Implementing the Variation Race Our Variation Race strategy is straightforward yet effective. Here's how it works: In the example below, we have prepared for the Variation Race implementation before Q4, and crowned variation #4 as the champion variation (notice the revenue difference versus variation #1).

Following the implementation of the Variation Race, we saw the fourth variation emerge as the best selling one, boosting overall parent revenue by 20% in just three months. At the same time, variations one and six, each supported by their own new campaigns, maintained sales momentum and saw improved conversion rates by targeting the most relevant variation-specific keywords exclusively.

3. Step-by-step instructions

a). Spot the champion variation

Download the following reports: Sponsored Products Purchased product report, Sponsored Brands Attributed Purchases report
Aggregate the data and sort variations by sales, a pivot table should do the trick.
Analyze PPC performance across variations.
While we typically focus on CVR %, it alone isn't the ultimate metric. Since customer preferences drive traffic, we also consider sales volume and overall performance.
Spot your champion variation
Inside each existing campaign pause all variations, except for the champion: Campaign > Ad group > Ads.

b). Separate Campaign sets for Variation-Specific Keywords

When any of the remaining lower-performing variations have unique keywords that target specific customer searches, create a separate campaign set* for each one. For example, if a "red shirt" variation has unique keywords like "red shirt pack", target them exclusively in a separate campaign set for that variation alone. *campaign set = all campaign types.

c). Variation specific keyword isolation

Negate all variation specific keywords in the champion's campaign set, and all main keyword trees inside the variation specific campaign set.

d). Close the circle with Sponsored Display

Repeat the process by downloading the Sponsored Display Purchased product report, as you want your best converting ASINs to target relevant competitors (red variation will convert better on a red competitor) to help streamline your product attribution campaigns as well.

e). Exceptions

The only exceptions we found, had very big differences between variations in: pricing, listing quality, inventory availability, product design (and or problem solved as it would generate separate keyword trees).

f). There is no "set it and forget it" in profitable advertising

During the transition process, make sure to constantly monitor and adjust for maximum impact by analyzing performance metrics, BUT don't get cold feet, make sure you compare apples to apples (like seasons) and have data-sufficiency before ruling out parts of the variation specific keyword split-test.

4. PPC-Driven Inventory Planning

If done right, the Variation Race should have an impact on units ordered per ASIN in the future, and we want to be proactive about it. Being Amazon sellers for a long time ourselves, we have long understood that advertising strategy has a direct impact on inventory patterns. Once the results of implementing the Variation Race are in, we craft a detailed inventory recommendation in line with current sales volume per variation. *Season-specific inventory levels are still taken under consideration.

For example, we used the Q4 data from when the Variation Race was fully implemented to help adjust this brand's inventory for next year's Q2, based on the new sales patterns for each specific variation after the race. This allowed the client to optimize stock levels per variation, avoiding overstock or understock issues. It's uncommon for an Insiders® client to place a large order without consulting us first. Effective communication between the PPC management and the Amazon account is key.

Conclusion

The Benefits of Variation Race The Variation Race tactic helps Amazon sellers boost profitability by concentrating ad spend on high-converting variations, ensuring each variation performs where it is best. After implementing this for our clients, the sales and net profit increased between 5-25% within 3 months.

Insiders tip: If the category/variation specificity allows for it, consider removing the winning variation from the parent after it can stand on its own (review/rating wise) and launch it as an independent product.

Sebastian Eduard

With over a decade of experience as an Amazon Seller and a consultant at heart, my mission through Insiders® is to deliver outstanding Amazon PPC Management, built on the respect and transparency I once sought during my own seller journey. The 50+ brands that entrusted us with +$65M Ad Spend, received $280M in Ad Sales and +$585M Total Revenue.