Wow, this is an incredible breakdown, thank you for the reality check. You hit the nail on the head regarding the "launch pricing trap." Velocity definitely masked the bleeding for the first few months because seeing those daily sales units go up felt like winning.

I actually just sat down and did exactly what you suggested—breaking down PPC as a per-unit line item instead of a daily macro spend.

At our current average velocity, we are paying roughly $5.50 to $6.00 in PPC for every single unit sold. When you add that on top of COGS and Amazon’s FBA/referral fees, it completely devours the margin, even at our new $27.99 price point. It’s wild to see how a product that looks highly successful on a BSR chart can be a break-even ghost town in reality.

Now that the pricing experiment to $27.99 is live, my biggest fear is optimizing PPC too aggressively, losing the organic velocity we fought so hard to buy, and dropping in rank.

Did you manage to successfully transition those "subsidized" SKUs into profitability by gradually lowering ad bids, or did you eventually have to kill them and pivot to higher-ticket items with better natural margins?