In this article, we'll introduce you to the powerful tool known as Teikametrics Predictive AI-powered Bidder. Bidding is central to advertising on Amazon and Walmart, but most advertisers don't know how to bid optimally, resulting in overspending or underspending on ads and unpredictable results. Flywheel's AI-powered Bidder ensures that your ads are seen by your target audience while also being optimized for maximum efficiency and profitability.
Understanding bidding and its importance
Every time a shopper searches for a product on marketplaces like Amazon or Walmart, a real-time auction occurs to determine which ads are shown and in what order. Your ad placement depends on how your bid amount compares to others in the auction for the same keywords or those targeting the same product detail pages.
Both Amazon and Walmart run a second-price auction that consider the bid and also the relevance of the search term to your ad. This means that relevance can sometimes outweigh a higher bid, leading to more cost-effective placements where budgets go further and profit is maximized.
Key point:
Because your ads will only show up if you win a spot in the auction, figuring out the optimal bid for every keyword and target is very important so that you don't underspend or overspend on advertising.
However, many keywords and targets lack sufficient data for accurate calculations. Additionally, optimal bids are dynamic and change over time for every target, even requiring changing bids on individual targets multiple times a day. If sales trends shift or conversion rates drop, adjusting bids becomes vital to maintain profitability or drive growth.
Calculating and making these adjustments manually may be doable for small sellers just getting started, but once you’re growing on Amazon it quickly becomes untenable to do this at scale. Having technology to automate this process makes a big difference.
How does the Bidder work?
Teikametrics' Predictive AI Bidder is an AI-powered, automated solution to do this heavy lifting for you. After you turn on the Bidder, it learns about your products, ads, and goals. Its advanced and proprietary models use this info to calculate the optimal bid for every keyword and target. Our algorithms also learn from a wider marketplace of sellers, which is unavailable to the layperson. After calculating the optimal value, Flywheel actually changes your bids on the sales channel automatically to save you time.
User inputs: You tell the Bidder your ACOS Limit, Bid Modifier and other constraints so it always operates for your specific use cases
Proprietary AI Forecasting models: Our algorithms forecast average order value and conversion rate to determine the optimal bid for all keywords and targets, even ones with low data. Our best-in-class AI models consider many factors, including seasonality, holidays, sales events, product category, product price, match type, inventory status, and other proprietary components.
Why should I turn on the Bidder?
Implementing the Predictive AI Bidder offers numerous benefits.
Automation eliminates manual bid adjustments, saving you valuable time
Up to 50% improvement in bid-to-value accuracy across ad groups and campaigns
Daily performance improvements up to 30% increase in net revenue and up to 15% increase in CVR.
Maintained advertising efficiency throughout the day with hourly ACOS adjustments on Amazon.
Captures more profitable sales during holiday season and specific events like Prime Day
Understanding the mechanics of bidding, the science behind it, and the value that the Bidder brings to the table can significantly elevate your advertising strategies. By embracing bid automation, you're equipping yourself to capture growth opportunities, optimize profitability, and stay ahead in the competitive world of online marketplaces.