How do I find out if a marketplace seller’s advertising spend is carrying its sales?

Look first at the split. The marketplace dashboard usually shows sales attributed to ads and total sales. If most of the sales line moves up and down with the ad line, the listing may not hold its position without paying. If sales stay steady when spending dips, the products may rank on their own.

Next, ask about the periods when advertising changed. A pause for stock-outs, a budget cut or a seasonal change can show how the business behaves without the push. Ask the seller to explain it, and ask for the evidence. Check whether competitors have started bidding on the same terms, which can raise the cost needed to keep the same results.

Finally, put ad costs into the margin. Take product profit, subtract ad spending, fees and returns, and see what remains. Ask your accountant to do that on a monthly basis. A seller who relies on ads is not necessarily a bad sign, but you should know it, and ask whether the same advertising effort will be available to you after the sale. Ask for the keyword or product targeting lists as well. They are part of what the seller built, and a tidy, tested set is easier for you to carry on than a pile of old campaigns.

Key takeaways

• Compare ad-attributed sales with total sales over the same weeks.
• Ask what happened when spending was reduced or paused.
• Subtract advertising costs when you look at product margins.
• Ask whether the seller will help with ad accounts after closing.