Recent discussions among cross-border e-commerce sellers have highlighted growing concerns about advertising restrictions on Coupang stores. Many merchants report that previously functional ads suddenly became unavailable, significantly impacting store traffic and sales. What's causing these limitations, and how can sellers respond?
Two Primary Causes Behind Advertising Restrictions
Investigation reveals that Coupang's advertising limitations primarily stem from two issues: unpaid advertising fees and failure to meet platform advertising standards. While the first scenario represents a common operational challenge, the second involves deeper platform regulations.
Cause 1: Unpaid Advertising Fees - Timely Settlement Crucial
Like other e-commerce platforms, Coupang operates on an advertising fee settlement cycle. The platform typically deducts monthly advertising expenses from sellers' settlement amounts starting 15 business days after each month's end. However, when advertising costs exceed the settlement amount, sellers must make additional payments. Failure to settle these balances promptly results in advertising suspension due to outstanding fees.
Currently, Coupang's system only supports deducting advertising fees from settlement amounts due to technical limitations. This means sellers with insufficient settlement balances must wait for platform technical updates before restoring advertising services. Merchants should monitor account balances closely and ensure timely fee settlements to avoid promotional disruptions.
Cause 2: Failing Advertising Standards - Product Performance Index Matters
Coupang offers two advertising types: Smart Ads (platform-automated keyword targeting) and Manual Ads (seller-customized keywords and bids), both operating on a cost-per-click (CPC) model. Many sellers encounter "does not meet standards" errors when setting up ads, primarily due to the Product Performance Index.
This proprietary metric, calculated through undisclosed algorithms based on product link sales and click-through rates, requires a minimum 50% score for advertising eligibility. New product listings typically struggle with low initial performance indices due to insufficient sales and click data, creating challenges for new sellers and products.
Strategic Responses for Sellers
Sellers facing these restrictions can implement several effective strategies:
- Regular Account Monitoring: Maintain consistent checks on account balances to ensure sufficient settlement amounts or promptly pay excess advertising fees.
- Listing Optimization: Enhance product listings with high-quality images, compelling titles, and detailed descriptions to improve click-through and conversion rates. Participate in platform promotions to increase visibility.
- Prioritize Established Listings: Focus advertising efforts on older product links with higher performance indices while gradually building new listings through organic traffic and limited external promotion.
- Policy Awareness: Stay informed about platform policy changes to adjust strategies accordingly and avoid violations.
- Diversified Marketing: Supplement with alternative promotion methods including social media marketing, content marketing, and affiliate programs to expand product exposure.
While advertising restrictions present challenges, sellers who understand platform mechanics and implement strategic responses can maintain business growth through refined operations and multi-channel approaches.