How We Reduced ACOS by 35% for an eCommerce Brand Using AI

The Challenge

GoVegan, a plant-based nutrition brand selling on Amazon India, came to ATIL with a common problem: their Amazon advertising was eating into their margins. With an ACOS of 28%, nearly a third of their ad revenue was going back to Amazon in advertising fees.

Their specific challenges included:

• All campaigns were auto-targeting with no manual campaign structure
• No negative keyword management — budget was bleeding to irrelevant search terms
• Bids were set at launch and never adjusted
• No day-parting or placement optimization
• Search term reports were reviewed once a month at best

Our Approach

Phase 1: Audit and Restructure (Week 1-2)

We conducted a deep audit of the existing campaign structure and search term data. Key findings:

• 32% of ad spend was going to non-converting search terms
• Competitor brand terms were consuming 15% of budget with near-zero conversions
• Auto campaigns were running at the same bids 24/7 despite clear conversion patterns

We restructured the entire account using our tiered campaign architecture:

• Exact match campaigns for proven converting terms
• Phrase match campaigns for discovery
• Auto campaigns with reduced bids for broad discovery only
• Negative keyword lists applied across all campaigns

Phase 2: AI-Powered Optimization (Week 3-8)

Once the structure was in place, we activated ScaleSkus automation:

• Real-time bid optimization using Marketing Stream data
• AI search term classification running continuously
• Day-parting with 7x24 bid multiplier grids
• Automated budget reallocation between campaigns

Phase 3: Scale (Month 3+)

With ACOS trending down, we reinvested savings into scaling:

• Expanded keyword coverage in profitable campaigns
• Launched Sponsored Brands for category dominance
• Added Sponsored Display for retargeting

The Results

After 90 days of AI-powered management:

• ACOS dropped from 28% to 10.2% — a 63% reduction
• Sales volume increased by 45% — lower ACOS meant more budget available for profitable growth
• Over 850 negative keywords were added automatically by our AI system
• Organic ranking improved for 12 primary keywords, driven by increased advertising velocity
• TACoS (Total Advertising Cost of Sales) fell to 6.8% as organic sales grew

The combination of AI-driven optimization and proper campaign architecture transformed GoVegan’s Amazon advertising from a cost center into a profitable growth engine.

Key Takeaways

1. Campaign structure matters more than individual bid optimization
2. Negative keyword management is the fastest path to ACOS reduction
3. Real-time data enables optimizations that manual management simply cannot achieve
4. AI automation compounds over time — results improve as the system learns
5. Lower ACOS enables reinvestment, creating a virtuous cycle of growth