If you want to be successful on Amazon in 2024 and beyond, you need to have a good Amazon PPC management strategy. 

Internal Amazon advertising consists of Amazon Pay-per-Click (PPC) advertising. Targeting particular keywords through Amazon PPC services, companies, agencies, and third-party sellers will produce ads for their items that show up in Amazon's search results and rival product listings.

In this sense, retailers can show Amazon consumers who are ready to buy pertinent products at the point of sale, and then track the efficacy of their ads to pinpoint which particular ones are generating conversions.

▶ What is Amazon PPC?

Amazon PPC is the advertising platform Amazon makes available to its third-party sellers. It allows sellers to create ad campaigns for their products and then charges them each time a potential customer clicks and views their ad.

Before we get into the details of PPC though, it’s important to understand Amazon’s key PPC metrics. This is how Amazon describes each one:

Advertising Cost of Sales (ACoS): 

The percent of attributed sales spent on advertising. This is calculated by dividing total ad spend by attributed sales. For example, if you spent $4 on advertising resulting in attributed sales of $20, your ACoS would be 20% (ie. $4/$20 = 0.20).

Attributed Sales: 

The total product sales generated within one week of clicks on your ads. Your sales data can take up to 48 hours to populate so, as a result, sales data is not available in the ‘Today’ date range and may be delayed to the ‘Yesterday’ date range. You can view the individual sales totals for advertised products and other products in the Campaign Performance report.

Impressions: 

The number of times your ads were displayed. Once identified, it may take up to three days to remove invalid clicks from your reports. Clicks from the last three days may be adjusted due to click invalidation.

Clicks: 

The number of times your ads were clicked. Once identified, it may take up to 3 days to remove invalid clicks from your reports. Clicks from the last three days may be adjusted due to click invalidation.

* Why is PPC important for Amazon sellers?

As consumer shopping increasingly shifts online — and, overwhelmingly, to Amazon.com — e-commerce brands and sellers have immense opportunities to succeed. But with that influx of online retail traffic comes more competitors looking to capture the most sales. 

In 2024, having an effective PPC advertising strategy is all but essential for Amazon businesses of all sizes. After all, there are hundreds of millions of products on Amazon, and listings can easily get lost in the noise. 

And while your organic ranking — the place where your product appears in search results naturally — is important, advertisements help increase your reach on the platform. 

* How to create an Amazon PPC strategy

Here are the basic aspects of building a solid Amazon PPC management strategy: 

Experimentation.

Test out each type of PPC ad campaign, and play around with automatic and manual keyword targeting to see what’s best for your brand.

Research.

Perform detailed keyword research using IndeedSEO’s Keyword Scout, focusing both on related keywords and competitor products.

Budget.

When starting, set daily budgets and default bids 50-100% higher than what Amazon recommends.
Duration. Let ad campaigns run for at least two weeks before running reports and making adjustments.

Campaign types.

Use ad reports from your automatic campaigns to find keywords for your manual campaigns. Before adjusting or removing a keyword from a manual campaign, make sure the keyword gets at least 10 clicks.

Review.

Continue reviewing your ad reports once a week, subtracting, adding, and adjusting keywords as needed.

* Types of Amazon PPC ads

Let’s discuss the types of Amazon PPC ads available, in order of their popularity among third-party sellers:

1. Sponsored Products ads

Sponsored product adverts show up on search results and product listing sites and quite resemble natural listings. 66% of independent merchants employ this most often occurring form of Amazon PPC advertising.

Two kinds of keyword targeting techniques a seller can utilize while designing sponsored product ads: automatic targeting and hand targeting. Let’s explore their differences.  

* Automatic Targeting

The automatic strategy involves targeting keywords that Amazon’s algorithm determines are related to your product listing. Over time, Amazon uses data that it collects from shoppers’ clicks and purchases, then adjusts the ads to better suit your listing and increase conversions. 

Within automatic targeting, sellers can use four different keyword match types: 

Close match ads:

Appear when shoppers use search terms that are closely related to the product you’re advertising

Loose match ads:

Appear when shoppers search keywords loosely related to your product 

Substitutes:

Target shoppers who are considering products that are similar to your product but sold by a different brand (e.g., a Cuisinart blender instead of a KitchenAid blender) 

Complements:

Target shoppers viewing detail pages of products that complement yours (e.g., paintbrushes to go with a paint set)

As “automatic” implies, this is the easier targeting method from a seller’s perspective. The downside is that it lacks the optimization options that other ad types offer.

* Manual Targeting

Manual targeting involves hand-selecting the keywords you want to bid on. Manually targeted ads will only appear if a shopper’s search terms match your chosen keywords. As a more “hands-on” type of ad, you will need to monitor changes in costs and make adjustments where applicable. This optimization often results in more effective ads and a lower long-term ad spend.

2. Sponsored Companies Advertisements

Originally called "headline search ads," sponsored brands let retailers raise awareness of multiple products at once and grab consumers' attention with more solid images than with sponsored products. 

Sponsored Brands let merchants select from three forms, which can show up as headline banners at the top of Amazon search results or deeper down the page as a video. 

Product collection” and “store spotlight” ads typically include the brand’s logo, custom tagline, and two or more products, whereas the “video” format includes a 15-30-second-long video showcasing a single product.

3. Sponsored Display ads

Sponsored Display ads allow sellers to retarget customers who have visited their product detail pages, on and off Amazon. Unlike Sponsored Products and Sponsored Brands ads, Sponsored Display ads can appear on Amazon’s affiliate sites, including Google, Facebook, Netflix, and even mobile phone apps. Like Sponsored Brands ads, a seller must have a registered brand to utilize them.

Sponsored Display is the newest type of PPC, and hasn’t quite reached the popularity of Sponsored Products and Sponsored Brands: just 25% of third-party Amazon sellers use Sponsored Display PPC ads.

How to create Sponsored Products PPC ads

Since Sponsored Products ads are a great introduction to PPC in general, we’ll go over how to set one up, based on targeting technique. 

For information on how to set up other types of Amazon PPC ads, see the following in-depth guides:

How to create an automatic-targeting sponsored product ad

1. Log in to Amazon Seller Central and select Advertising > Campaign Manager

2. Scroll below the graphs and click on the yellow “Create campaign” button

3. Click “Continue” under Sponsored Products.

4. Next, fill in the information on the Settings section of the Create campaign page.

Campaign name

Choose a name for your campaign. The name can be anything that helps you remember the purpose of the campaign. We recommend naming your campaign after the product and then using the Ad Group name with the campaign type and product’s variations if any (see below).

Date

Select the start and end date for your campaign. If you want your campaign to run indefinitely, leave the end date field blank.

Daily budget

Amazon allows you to set the maximum amount of money you want to spend on ads per day. According to Amazon, if your ad spend comes in under the set amount at the end of a day, the leftover amount can be used to increase ads by 10% on a later date in the same month. Also, ad costs are charged either a) when you reach $500 in total ads or b) at the first of the month.

The cost for your ads is taken directly from your account balance, and if you don’t have enough funds in your account to cover the cost of your ads, Amazon charges the credit card you put on file at the time of registration.

Targeting

Choose “automatic” for an automatic-targeting sponsored product ad.

5. Choose your campaign bidding strategy

There are three types of campaign-bidding strategies for automatically targeting Sponsored Products ads.

Dynamic bids – down only. Amazon lowers bids in real time when you’re less likely to make a sale. This prevents your ad from showing up on irrelevant product searches.
Dynamic bids – up and down. In addition to lowering your bid as a ‘down only’ bid, if your automatic-targeting sponsored product is more likely to convert, Amazon will increase the price of your bid by 10%.
Fixed bids You set your bid and Amazon does not change it – unless you choose to adjust it.

6. Create an ad group

Ad group name

Your ad group name represents the products sharing the same bids and budget. Again, the name can be anything, but ideally, it should help you remember the purpose of the ad group. We recommend that you name your ad group after the type of campaign (automatic or manual), plus the product’s variation. 

Naming example: 

1. Campaign name: bamboo skewers
2. Ad group: automatic – 50-pack
3. Products
4. Select the products that you wish to advertise. We recommend selecting only one product per ad group when you are starting. 

7. Set your bids

If you wish to make things easy for yourself, you can set a default bid for all types of matches. Amazon suggests $0.75 to start, regardless of the product. However, we recommend bidding a little more aggressively when you’re first starting (bidding as high as $1.50 to $2.00) to ensure early sales.

Set bids by targeting group

For more advanced automatic targeting, you can select bids by targeting groups and placing different amounts for each strategy.

As you’ll recall, the four types of automatic targeting bid strategies are:

Close match.

This shows your sponsored product ad to those who use search terms closely related to your products. For example, if your product is a “black, 48-inch broadsword”, your product would show up in searches for “black broadsword” or “48-inch broadsword”.

Loose match.

This shows your sponsored product ad to those who use search terms loosely related to your products. For example, if your product is a “black, 48-inch broadsword”, your product would show up in searches for “sword” or “medieval weapon.”

Substitutes.

This displays your sponsored product ad to consumers looking at detail pages of like-minded products. If your product is a "black, 48-inch broadsword," for instance, it would show up on detail pages for "silver, 48-inch broadsword," or "black, 52-inch broadsword.

Complements.

This shows your sponsored product ad to shoppers who view detailed pages of products that complement yours. For example, if your product is a “black, 48-inch broadsword”, your product would show up on detail pages for “large, steel shield” or “leather sheath for sword.”

You can set different values for each of the bid strategies. Amazon makes recommendations for these bids based on similar sellers’ bid amounts.

8. Add negative targeting keywords (optional)

If you don’t want your product to show up in certain keyword searches, you can add those keywords to the automatic targeting list. When starting, we recommend that you leave the list blank.

Later, we’ll show you how to add poor and high-performing words to this list.

9. Launch campaign

Be sure to double-check all of your information. Then, once you’re ready, click the yellow ‘Launch campaign’ button at the bottom of the page. You can also save your draft if you need to come back to the listing later. 

It usually takes 30 minutes to an hour for your ad to premiere on Amazon.

Start advertising on Amazon with PPC

With this Amazon PPC advice, perhaps, your advertising activities on Amazon will be easier. Please bookmark this tutorial since it contains a lot of insightful material for your next use.

Want to create your products on Amazon and start researching keywords? IndeedSEO, the core data and toolset of SEO will enable you to triumph on Amazon. 

Please leave comments with any Amazon PPC ideas and techniques you have found successful. We would enjoy hearing them!