“Automotive Industry”
– Case Study –
The Client:
Our client is a well-established leader in the supply of engineering components, consumables, and industrial solutions, serving businesses across the automotive and manufacturing sectors. With a nationwide presence, they offer an extensive range of products, including bearings, fluid power systems, seals, and repair equipment with an extensive inventory of over 30,000 SKUs.
The Challenge:
The client was struggling with a high ACOS (Advertising Cost of Sales) of 33% on their Amazon account and needed a solution to optimize ad spend while maintaining sales levels. In addition to improving advertising efficiency, they required support with their FBA strategy and inventory replenishment, as they were facing challenges in keeping stock levels optimized.
At the same time, the client experienced a decline in eBay sales over the past two years and was looking for a strategy to regain visibility and drive sales growth on the platform. They needed a targeted approach to reestablish their presence and improve overall marketplace performance.
The Solution:
We proposed a complete restructuring of the Amazon advertising strategy, focusing on smaller product groups categorized by profitability, brand, and demand. To achieve this, we conducted a detailed profitability and sales volume analysis to identify the best-performing SKUs from their extensive catalog. Over a three-month period, we gradually transitioned from the previous broad targeting approach to our optimized, data-driven strategy.
For FBA strategy and replenishment, we developed a customized reporting system tailored to the client’s needs. This report provided clear insights into which products should be sent to FBA based on sales performance and profitability potential, making replenishment decisions more efficient and reducing inventory management challenges.
On eBay, we conducted an in-depth analysis of four years’ worth of sales data to identify trends and missed opportunities. Based on this, we developed a structured plan to optimize and retarget key product segments, prioritizing SKUs that had previously generated strong sales volumes. We also redesigned the pricing strategy to align with the client’s market positioning, shifting our focus to the top 200 SKUs with the highest growth potential once optimized.
The Results:
After restructuring and implementing the new advertising strategy, we successfully reduced the client’s ACOS to 13.78%, based on the last three months’ average. This was achieved while maintaining the existing ad spend budget, optimizing the targeting approach, and increasing both sales and impressions. By refining the strategy, we not only stabilized ACOS but also maximized sales potential within the allocated budget.
The FBA replenishment process became significantly more efficient, allowing the client to make smarter stock decisions and streamline the selection of products for trial under the FBA strategy. This improved stock management, reduced inefficiencies, and ensured better alignment with demand.
Through product selection optimization, pricing strategy adjustments, and repricer fine-tuning, we achieved a 17.36% year-over-year (YOY) increase in sales. By continuously monitoring pricing and product performance, we were able to act proactively, seizing opportunities to further maximize profitability and sales growth for the client.