What Strategies with Negative Keywords Lead to Low ACОS?

July 25, 2024
By The Badger

A couple of weeks ago, we were analyzing accounts with low ACОS and noticed a key difference: these accounts heavily used negative keywords.

Negative keywords help prevent your ads from showing up for irrelevant searches, saving your budget for more profitable clicks.

In this article, we discuss the importance of negative keywords and their impact on ACOS. There are three types of negative keywords—broad, phrase, and exact—each offering different scopes for excluding search queries.

We recommend checking your negative keyword multiple (the ratio of negatives to positives). A higher ratio often correlates with better ACОS.

Aim for a 3 to 5x ratio, and you’ll likely see positive results.

So, what’s your negative keyword multiple? Give it a try and watch your ACОS improve.

Check out this episode of the PPC Den Podcast where Michael discusses “How To Achieve Low ACOS With Negative Keywords.”

What Are the Common Habits of Low ACОS Accounts?

Through detailed analysis, we discovered several habits that consistently contribute to low ACOS. These accounts heavily use negative keywords and regularly update their negative keyword lists. They also maintain a high negative keyword multiple, which means for every positive keyword, there are several negatives.

Now, we’ll explain why these practices work and how you can apply them to achieve better results.

What Are Negative Keywords and Why They Matter?

Negative keywords are specific words or phrases that prevent your ads from being triggered by irrelevant search queries. By adding negative keywords to your campaigns, you can ensure your ads don’t appear in searches unlikely to convert, thereby saving your budget and increasing your return on investment (ROI).

For instance, if you add negative keywords such as “free,” “cheap,” “DIY,” and “tutorial,” your ads will be filtered out of searches containing these terms. This means your ads are more likely to be shown to users who are genuinely interested in making a purchase, leading to higher conversion rates and a better ROI.

They help filter out irrelevant traffic, allowing you to reach potential customers who are more likely to engage with your ads and make a purchase.

Furthermore, negative keywords prevent wasted clicks and help you avoid bidding against yourself, ultimately saving money. The strategic use of negative keywords is crucial for achieving low ACОS (Advertising Cost of Sales), as it ensures that your budget is spent efficiently on the most relevant and profitable search queries.

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What Are the Negative Keyword Match Types and How Do They Affect Low ACОS?

Negative keyword match types include broad, phrase, and exact match, each determining the scope of excluded queries.

Each match type functions differently from their positive counterparts, offering unique ways to control which searches trigger your ads.

Unlike positive keywords, negative keywords do not match close variants or other expansions, making their correct implementation vital for campaign success.

How Do Broad Match Negative Keywords Help Achieve Low ACОS?

Negative broad match keywords stop your ads from showing up for search terms that include the specified keywords in any order, along with other words.

However, be careful with broad match negative keywords. Using too many can overly restrict your ad reach and exclude many search variations, potentially missing out on valuable traffic.

How Do Phrase Match Negative Keywords Improve Targeting?

Phrase match negative keywords make sure your ads don’t appear for specific keyword phrases, no matter what words come before or after. It balances broad and exact matches, giving some flexibility while still blocking irrelevant traffic.

Why Are Exact Match Negative Keywords Crucial for Refining Ad Strategies?

Exact match negative keywords offer the most precise control by preventing ads from showing only for the exact search queries. This means your ads won’t appear if the search contains the exact keyword terms in the same order, without any extra words.

This type of keyword is perfect for excluding highly specific queries that are irrelevant to your campaign.

How to Calculate the Negative Keyword Multiple?

The negative keyword multiple is a metric that helps understand the balance between positive and negative keywords.

To calculate it, start by counting the total number of positive keywords you are targeting.

Then, count the total number of negative keywords you have set.

Divide the number of negative keywords by the number of positive keywords.

For example, if you have 1,000 positive keywords and 3,000 negative keywords, your negative keyword multiple is 3x.

Aim for a multiple of 3 to 5x, meaning for every positive keyword, there should be three to five negative keywords.

How Do High Negative Keyword Multiples Impact ACОS?

Analyzing low ACОS accounts reveals that these accounts often have high negative keyword multiples. This means they use a large number of negative keywords compared to positive keywords.

For example, some accounts had 41,000 positive keywords and 1.5 million negative keywords, resulting in a 38x multiple. This high ratio is a key factor in their success.

High negative keyword multiples allow for greater control over which searches trigger ads. By excluding a wide range of irrelevant queries, these accounts ensure their ads are only shown to highly relevant audiences.

Accounts with high negative keyword multiples generally experience better ACОS because the extensive use of negative keywords helps to eliminate unproductive clicks.

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How to Identify Negative Keywords to Achieve Low ACОS?

Identifying negative keywords is crucial for optimizing your ad campaigns and achieving a low ACОS. This involves asking specific questions to determine if a search term should be considered negative, such as whether it generates high clicks but low conversions or does not align with your campaign’s intent.

There are several methods to find negative keywords, including:

Сonducting keyword research
Analyzing the Search Terms Report
Performing searches with Ad Badger Software

Each method offers unique insights into potential negative keywords that can help refine your targeting and improve campaign performance, ultimately driving down your ACOS.

Conducting Keyword Research for Low ACOS

Performing comprehensive keyword research is key to discovering both relevant and irrelevant search terms.

Start with broad match keywords to capture a wide range of search terms. These can later be refined to identify and exclude irrelevant ones using Amazon’s Search Term Report.

This process helps improve ad targeting and ensures your ads reach the right audience, contributing to a lower ACОS.

Using Search Terms Report to Optimize ACOS

The Search Terms Report in Amazon Seller Central is a powerful tool for optimizing your ACОS.

You may ask: where should I start?

Under the ‘Reports’ section, select ‘Search Term Report.’ This report shows the actual search terms customers used that resulted in ad impressions and clicks.

Review the report to identify search terms that are irrelevant to your product or that have generated high clicks but low conversions.

These terms are costing you money without delivering results, so they should be added to your negative keyword list.

To add a negative keyword, go to the specific campaign or ad group in the Campaign Manager where you want to exclude these terms.

Select the ‘Negative Keywords’ tab and add the irrelevant search terms identified from your Search Term Report. Choose the appropriate match type (negative exact, negative phrase) based on how strictly you want to exclude these terms.

By systematically excluding irrelevant search terms, you prevent wasted ad spend on non-converting clicks, which directly contributes to lowering your ACOS.

Low ACOS Optimization with Ad Badger Software

Manual searches are another effective method for identifying negative keywords. Perform searches related to your intended advertisements using Ad Badger Software and evaluate the relevancy of the results to pick out irrelevant terms.

Using Ad Badger’s autocomplete and keyword suggestion features can reveal commonly searched terms that might be irrelevant, aiding in the creation of negative keyword lists.

For example, typing in ‘online tutor’ might show irrelevant terms like ‘jobs’ and ‘free,’ which can be added to your negative keyword list.

What Are Techniques for Effective Negative Keyword Management?

Effective negative keyword management is crucial for optimizing your Amazon PPC campaigns and achieving a low ACОS.

Here are some key techniques that can help enhance your negative keyword strategy.

How to Use N-gram Analysis for Negative Keywords?

N-gram analysis is a method of analyzing the frequency of word sequences within your search terms data.

Gather search terms data from your Search Term Reports and use tools like Ad Badger’s N-gram analysis feature or a spreadsheet to identify common patterns.

Look for recurring words or phrases that indicate irrelevant traffic, such as “cheap,” “free,” or “DIY.”

Add these recurring terms as negative keywords to exclude a broader range of irrelevant queries that follow a common pattern, improving your ad targeting.

Conclusion

A higher negative keyword multiple correlates with better ACОS. By maintaining a robust list of negative keywords, you can ensure that your ad spend is focused on the most relevant and high-converting search terms.

Regularly review and expand your negative keyword list to enhance your ad targeting and improve your campaign performance. Curious about your negative keyword multiple? Add more negatives and observe how your ACОS evolves.

Happy optimizing!