How does Threshold Builder work?
The Threshold Builder guides you to know what are the initial values for your campaigns that are geared towards optimization. The values in its formulas need to be filled up.
With your inputs and data from your latest Campaign Advertising Report, Threshold Builder helps establish the specific Rules that would direct you to better profits. The default time frame is the last 60 days. This is the default duration the system will run your algorithm or review product data.
Threshold Builder neither analyzes nor automates your campaigns.
It is the Auto-Mate engine that optimizes your campaigns.
Why are Rules important?
As ZonTools identifies which campaigns are not yet automated, your next step is to set your critical limits for each campaign. At the onset you need to establish what we call Rules so that your bid thresholds or targets are implemented efficiently, resulting in stress-free bidding.
To help you determine what these rules are, and encode them properly, you need to launch Threshold Builder. It is a built-in calculator designed to help you find the most efficient campaign thresholds or Rules.
Each campaign needs to implement 6 rules or campaign thresholds prior to automation. You can see these as data fields on your Rules popup.
7 Campaign Rules
- Target Max ACoS %
- Relevancy Sales
- Min Action Clicks #
- Max KW Spend $
- Min Bid $
- Max Bid $
- Change Rate % (change rate percentage)
There are no right or wrong values, as the system allows you to plug in whatever values you want to use, but of course, there are values that will work in your favor and those which will not. There are values which erode whatever profits you are gaining by making your ad campaigns bleed.
To set up your Rules using Threshold Builder:
As the Threshold Builder serves to help you define the rules of your campaign/PGN, you need to enter several key metrics.
- On your Threshold Builder
- Enter your Product Sale Price.
This is the sale price of your product in this specific campaign. It answers the question: how much do you sell your product on your listing?
- Enter your Profit Margin (%).
To get your Profit Margin, use this link: https://sellercentral.amazon.com/hz/fba/profitabilitycalculator/index?lang=en_US
- Enter your Expected PPC Profit.
Your Expected PPC Profit depends on why are running your campaign/PGN.
a) Expected PPC Profit % is zero (0)
If you are running this campaign for traffic and visibility and not profit. This is for cases when you want to reach a break-even level and gain traffic, or when you want to launch a campaign to create awareness of your product for marketing purposes (also known as visibility).
- b) Expected PPC Profit % is your target value.
- If you are running the campaign to make some profit, then the value will
- depend on your expectations.
- Go back to the Campaigns section of the dashboard. From the Campaigns table, get the values of these metrics:
- From the (cost per click) CPC column, copy your Average CPC and paste this value to the Threshold Builder.
- FORMULA: advertising spend or cost / number of clicks
- From the (conversion rate) CR column, copy your CR7 and paste this value to the Threshold Builder.
- FORMULA: number of sales / number of clicks
When getting the Conversion Rate, always make sure to use your CR7 as ZonTools runs all Rules by 7's, so we want to make sure that the data we are using are also by 7's.
- For the Keyword/Bid Change Speed: Use the default value 20%.
ZonTools limits your daily bid adjustments up to 20% by default, to accommodate data delays by Amazon.
- Click Apply to see the calculated rules.
- This action triggers the system to populate your 7 rules for this specific campaign/PGN. You can expect that all these rules will take effect instantly.