High ACOS in a marketplace: pause PPC or hold until organic ranking improves?
I manage a home product that leaves margin on our own site, but it becomes tight inside the marketplace. Price is EUR 29.90, commission and logistics take a lot, and with PPC the ACOS sits around 42-48%. We have 38 reviews, conversion is around 7% and stock for about 5 weeks if we keep the current pace. I am worried about switching ads off and falling in organic rank, but also about burning cash to chase ranking. Would you look at TACOS, margin per order, stock or listing conversion before deciding?
I would separate two decisions: defending ranking and making money. Calculate break-even ACOS with the real net margin: price before tax where relevant, commission, logistics, product cost, expected return and coupons. If your pre-ads margin is EUR 8, you cannot treat a discovery click the same as a brand click. I would keep only the exact terms that convert, plus a small exploration campaign with a daily cap. If TACOS does not fall and organic does not improve for those keywords within two weeks, it is not ranking investment anymore: it is expensive rent on sales.
With stock for 5 weeks I would not push hard. Running out of stock after paying for sales often turns out worse than reducing ads in an orderly way. Lower budget before the algorithm pulls you toward a stockout, and reserve units for the searches you already know convert.
Before touching bids I would review why conversion is at 7%. On marketplaces, the main photo, price comparison and first visible reviews weigh a lot. If the listing does not convert, increasing budget only buys expensive data.
I slightly disagree with pausing too early. There are keywords where you can accept losing some money if you see organic rank moving and you have cash room. What I would not do is leave it open-ended: fixed budget, clear hypothesis and a cutoff if it does not improve.