Budget Automation

This article describes how to use budget automation in Kapoq, and contains the following six sections:

Kapoq's budget automation automatically calculates suggested budgets for each of your campaigns and sends them to Amazon/Walmart. Both Amazon and Walmart are supported. Please note that budget automation is not yet available for DSP.

The objective of Kapoq's budget automation is to hit the monthly target that you set at the budget group level. For example, you might set a monthly ad spend target of $50,000 for a budget group composed of many campaigns. Kapoq's budget automation algorithm will update budgets for campaigns in the budget group each day to try to hit the monthly ad spend target as closely as possible.

The primary data source for budget automation is Amazon Marketing Stream

(AMS) which provides near real-time advertising metrics and budget usage data.

Whenever AMS data is unavailable (or for channels like Walmart), Kapoq

uses data from the standard reporting APIs to optimize budgets.

Budgets are calculated at least twice each day. Additionally, budgets are recalculated within 30 minutes of any setting change. Updated budgets are sent to Amazon/Walmart in batches every 15 minutes.

We recommend the following three step approach to setting up budget automation:

Kapoq offers several settings to customize budget automation. These settings are available at different levels, depending on the setting as seen in the table below:

Turn this on to activate Kapoq’s budget automation algorithm for the campaigns mapped to the budget group.

When enabled, Kapoq sends updated budgets to Amazon or Walmart. Before turning on budget automation, review all settings carefully.

The total monthly ad spend target across all campaigns in the budget group.

For Kapoq to suggest budgets, you must enter a positive number for the monthly budget automation amount; it is a required field. Note that if the amount varies by month (e.g., higher for November), you can set a custom calendar (as described later in Section 3).

Example: Suppose an account has 10 campaigns in a budget group and a Monthly Budget Automation Amount of $20,000. Kapoq will update budgets for those campaigns with the goal of spending $20,000 across the 10 campaigns for the month.

Sets a floor for the minimum budget suggested by Kapoq’s budget automation algorithm. In addition to this setting, suggested budgets are also floored at the marketplace minimum budget.

Sets a cap for the maximum budget suggested by Kapoq’s budget automation algorithm. In addition to this setting, suggested budgets are also capped at the marketplace maximum budget.

Kapoq’s algorithm always considers marketplace minimum and maximum budget constraints, but it also considers any configured minimum or maximum budget settings. For example, you might set the minimum budget for a campaign to $500 and the maximum budget to $1,000. In that case, Kapoq will always set a budget for that campaign between $500 and $1,000.

Select which metric the Kapoq budget automation algorithm should optimize for. The three optimization metric options in Kapoq are:

Note: Section 5 of this article includes more detail and an example illustrating how the optimization metrics work.

The number of trailing days of spend history budget automation uses to evaluate recent spend.

The number of trailing days of performance history budget automation uses to evaluate campaign efficiency using ACoS or CPA. This parameter has no effect if Prioritize Spend is selected as the optimization metric.

A percentage increase applied to daily budgets to account for the fact that not every campaign will fully utilize its budget every day.

Example: If a suggested budget is $100 without overspend allowance and the Overspend Allowance setting is 10%, then the suggested budget increases to $110.

Freezing a budget locks a campaign's budget at its current value, so Kapoq will never change it. This is useful when budget automation is running for a budget group but you want to exclude specific campaigns or strategies from any budget adjustments.

Note: Freeze Budget only matters when budget automation is turned on. If budget automation is off, Kapoq doesn't adjust any campaign budgets, frozen or not.

Even when frozen, a campaign's spend still counts toward the budget group's total monthly limit.

Tip: For best performance, use constraints like freezing and min/max budgets sparingly. The algorithm works best when it has freedom to optimize.

In addition to the settings above, please also note that under Advertising → Settings → Budgets, you can also configure the Average Daily Budget Increase. This is an Amazon account-level setting. This setting controls whether campaigns in the Amazon account can overspend their daily budgets by up to 25% or 100% on high-traffic days. For multi-brand accounts, any changes made here apply across all brands in the account. We recommend setting this to 25%, especially if you are using budget automation.
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You can also customize how spend is distributed across any month. Clicking the calendar icon to the left of the budget group name allows you to enable these overrides, as shown in the picture below:

For example, you can set a different monthly budget automation amount for a particular month (e.g., higher for November at 30,000 instead of 25,000) or for any specific day (e.g., 10% of monthly spend on Black Friday). If no overrides are set, the remaining budget is distributed evenly across the remaining days of the month.

This calendar view is available at both the budget group and the brand levels. In other words, you can navigate to Advertising → Settings → Budgets to set calendar overrides for all budget groups for the brand, or you also have the ability to customize them at the budget group level.

In order for Kapoq's budget automation to apply, you must:

This example illustrates how the Prioritize Spend vs. Prioritize Efficiency (ACoS/CPA) approaches optimize budgets differently.

For this example, assume the following setup:

Then, the first step is to calculate the target spend for the budget group on the 21st:

For this simplified example, assume the following:

The "spend forecast" is the amount a campaign would spend today if it had no budget limit.

The table below summarizes how Kapoq distributes the $1,000 / day for the budget group based on the optimization metric chosen.

Kapoq's budget automation does not currently:

Also, please note that the goals set in Kapoq under "Analytics > Goals" have no impact on budget automation.
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​We do not recommend using native automated budget rules on Amazon/Walmart while using Kapoq budget automation, as this creates conflicting logic:

No. You do not need to have bid automation turned on to use budget automation. You can use budget automation whether bid automation is turned on or off.

There is no "budget approval" screen in Kapoq like there is for bid approvals. If you have turned on the enable budget automation toggle at the budget group level (and completed all other requirements stated in Section 4 of this article), then updated budgets will be sent to Amazon/Walmart. Therefore, please ensure you have reviewed all settings before turning on the enable budget automation toggle.

One workflow you might consider is to first set up all budget automation settings while keeping the enable budget automation toggle off. Then you can review the Kapoq suggested budget for each campaign first, and then when you are ready for budgets to be sent out you can turn on the enable budget automation toggle.

For new campaigns, Kapoq waits 3 days to allow performance data to accumulate before making any budget changes or suggestions.