PPC Guide 2023 Final EN

2023
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Joseph Philipps
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Master Amazon Ads
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TABLE OF CONTENTS
Basics of advertising formats
1. What is Amazon PPC? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.1 How does Amazon PPC work? 4
2. Why should Amazon sellers advertise?. . . . . . . . . . . . . . . . . . . . . . 6
3. What Amazon Advertising formats do exist?. . . . . . . . . . . . . . . . . . 7

3.1 Sponsored Product Ads 8
3.2 Sponsored Brands 9
3.3 Sponsored Display (beta) 11
4. When are PPC ads displayed? . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

4.1 Based on keywords 13
4.2 Based on ASINs 16
4.3 Based on categories 16
4.4 Based on interests 16
5. What is the structure of Sponsored Product Ads? . . . . . . . . . . . . . 18

5.1 Automatic and manual campaigns 18
How to start your ads

6. How do I start Amazon Advertising?. . . . . . . . . . . . . . . . . . . . . . . 21
6.1 Optimization of the product detail pages for the qualification of products 21
6.2 Calculation of the Break-Even ACoS 22
6.3 Keyword research 23
6.4 Target definition 25
7. How do I create a Sponsored Product Ad? . . . . . . . . . . . . . . . . . . 26

7.1 Create a campaign 27
7.2 Create ad groups 29
How to optimize your advertising

8. How to make Amazon ads more successful . . . . . . . . . . . . . . . . . 30
8.1 Keyword management and bid adjustments 30
8.2 Performance values 31
9. Further possibilities for the optimization of Sponsored Products . 34

9.1 Dynamic bidding strategies and bids by placement 34
9.2 Strategic Product Targeting 36
9.3 Automation 36
Basics of advertising
formats
1. What is Amazon PPC?

Amazon PPC means Amazon Pay Per Click and is a billing model for advertisements on
Amazon. Only after a click on the ad is made, costs arise for the advertiser. Although Pay per
Click stands for the payment method itself, the term PPC is generally equated with the digital
advertising options that are billed via Pay per Click. PPC ads on Amazon are better known as
Amazon Sponsored Ads. The most popular advertising format is the Amazon Sponsored
Product Ad and can be placed on either a search results page or a product detail page. Amazon
merchants who create PPC ads pay for them - as the name suggests - based on the number of
clicks on the Sponsored Product.
1.1 How does Amazon PPC work?

The merchants first selects the products they wish to promote and can then select a
maximum daily budget per product during the PPC ad creation process. From this budget
the respective cost per click is subtracted after a prospective customer has clicked on the ad.
If the budget is used up after several clicks, the ad is no longer displayed.
There are various ways to play out advertisements. The most common method is keyword
targeting. The ads are played when the keyword matches the search term entered by a
potential customer.
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Example:
If you sell sunglasses and advertise a product with the keyword “sunglasses
men”, your ad will appear (if you have a certain relevance and make an
appropriate bid) if “sunglasses men” has been entered into the Amazon
search field
However, search terms and keywords are not always the same terms. You can find out more
in the section “When are PPC ads displayed?”.
The click price, i.e. the cost per click on the ad, depends on whether and how many other
advertisers bid for the same keyword. Amazon proceeds after the second price auction. This
means that the ad of the merchant who offers the most for a keyword is displayed, but the
merchant only has to pay the cost of the second bidder‘s bid + 1 cent per click on the ad.
The goal of Amazon PPC management is to find the keywords that are used to display your
ads, get clicks and generate as many sales as possible.
Caution: Just because you set a high bid for a particular keyword doesn't mean your product
is guaranteed to be played for it. Amazon's algorithm takes many factors into account when
ranking products, such as reviews.
High bids and daily budgets nevertheless increase the chance of clicks and sales. The
difficulty in PPC management, however, is to keep the bids as low as possible in order to
generate not only many sales but also profits with the sales. If, for example, the click price
is higher than the margin of the advertised product, no profit can of course be made with the
advertising campaign - no matter how many products are sold through it. Even if an ad
triggers many clicks but no sales, it causes losses for the merchant. Therefore, it must be
weighed and evaluated for which keywords high bids pay off.
Requirements to place Amazon advertisements

In order to perform Amazon PPC actions, you must have an active professional Amazon
seller account or Advertising Console (AMS). You can act as a seller or vendor.
Sellers sell their goods via Amazon to the end customers and vendors sell the goods
directly to Amazon. Both seller types are responsible for the PPC measures themselves.
Sellers manage their organic product sales as well as their Sponsored Products in
Seller Central. Vendors have two different accesses - the administration of the „normal“
product sales (product list creation etc.) is done via Vendor Central and for the
management of their advertising they use the Advertising Console (formerly AMS).
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2. Why should Amazon sellers

advertise?
The number of sellers and products offered on Amazon, as well as the quality of the product
detail pages has increased significantly in recent years. Due to this competition it has become
harder to show up in the organic search results on page 1. Organic search results are the
unpaid search hits displayed by the Amazon search algorithm “A9”.
A glance at the search results page reveals

the importance of advertising on Amazon.
If you don‘t pay, you have little chance of
becoming visible to potential customers.
Before they start scrolling, after entering
most of the search terms, only
advertisements (marked in red) can be
seen.
This makes Amazon‘s advertising possibilities all the more important, because
advertisements give advertisers the opportunity to reach the first position
within the search results with each of their products.
This not only increases sales through the ad, but also has other positive effects: When
campaigns work well, the number of product detail page views increases, which in turn leads
to an increase in both sales and seller performance, resulting in a higher number of organic
rankings and organic ratings.
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It is a cycle:
An increase within the organic
ranking leads to an increasing
number of page views and this in
turn leads to an increase in sales,
which leads to higher purchasing
volumes and thus to a reduction in
product costs.
Amazon PPC measures are also

important for obtaining informa-
tion about customers‘ search
behavior: The search term perfor-
mance data from PPC campaigns
provides insight into the exact
wording used by customers to
search for a product on Amazon
and which keywords Amazon
considers relevant to the
product. This data is inaccessible
to sellers who do not advertise.
Furthermore, important key performance indicators (KPIs) such as the number of

impressions, the click rate, and the conversion rate for certain search terms are only
displayed in Seller Central when you run ads. This is particularly relevant if, for example, A/B
tests are carried out by varying images, titles or prices (more on important KPIs can be found
in the "Performance values" section).
3. What Amazon Advertising formats do

exist?
There are several ways to advertise Amazon PPC. Depending on whether you act as Seller or
Vendor, you can use different advertising formats on Amazon. At the current time (January
2023) the following three main forms are available:
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• Sponsored Product Ads

• Sponsored Brands
• Sponsored Display Ads
3.1 Sponsored Product Ads

Sponsored Product Ads (SPAs) are the type of ads most commonly used on Amazon. They
correspond to text ads on Google and appear above, between, or below organic search results. They
can also be displayed in the “Sponsored products related to this item” section on the product
detail pages or below the attributes.
A tiny “Sponsored” indicator (marked in red) is the only difference in appearance compared to
organic search results. It is not possible to use special promotions, different prices, titles or images
for the SPAs. SPAs can be created and used both by sellers and vendors.
Example Sponsored Product Ads
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The ad itself does not have any other information than the organic image, title and price
information of a product. When a customer clicks on one of the Sponsored Product Ads, they
are directed to the product details page.
In general, Sponsored Product Ads are an advantage when it comes to increasing sales of
newly launched products or products with low organic rankings. They also serve to occupy
the advertising space for important search terms and thus ensure the company‘s own
visibility.
Sponsored Product Ads can be displayed through three variants, in which you can individually
select your bid, i.e. your maximum CPC (the amount you are willing to pay for one click):
1. An automatic variant in which Amazon researches suitable search terms and products
for you,
2. a manual keyword-based variant in which you select a match type and keyword and
3. manual product variant in which you can target products or product categories.
These options are explained in more detail in the following section “When are your PPC ads
displayed?”.
3.2 Sponsored Brands

Sponsored Brands or SBs are presented to the customer at the beginning of the purchase
decision process, as they are displayed very prominently directly below the search bar and
above the organic search results as well as above the Sponsored Product Ads. SBs can also be
displayed below the filter options on the left side and at the bottom of a search page. For
product targeting campaigns, SBs are also played out on product detail pages.
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You can use three different formats for Sponsored Brands: Product Collection, Store Spotlight
and Sponsored Brands Video.
Until October 2019, a Sponsored Brand was a keyword-only ad format consisting of a primary
image or logo, a headline up to 80 characters long, and three products (ASINs). With the new
capability of product targeting within Sponsored Brands, it is also possible to select ASINs and
categories for which ads should be displayed. The SBs then appear within the search results
page when the selected ASINs are placed on the first page.
ASIN:
Amazon has its own article number, the Amazon Standard Identification Number, for
all available products on the website, similar to an ISBN for a book. Via the ASIN, each
product listing or product detail page and thus the product sold on Amazon is uniquely
identifiable across countries. To avoid duplicates, an EAN or UPC is required for the
creation of a product. In case of variations, e.g. according to the size of a shoe, one
differentiates between Parent ASIN and Child ASIN, whereby the Parent ASIN serves as
a cover and cannot be purchased. In this case, the ASINs of the individual sizes are
referred to as Child ASINs.
When a customer clicks on the Sponsored Brand logo or title, they can be taken to an Amazon
Store, a custom landing page, or a custom Amazon URL with at least three branded products.
The destination is decided by you, the advertiser. When a customer clicks on one of the
featured ASINs, they are redirected to their product detail page.
Initially, only the logo and the headline of the sponsored brand ad are visible on mobile. By
"swiping" to the left on the display, the products also become visible.
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Since 2019, there are the so-called Sponsored Brand Video Ads. As the name suggests, this
format consists of a video that links to a product detail page or brand store after the ad is
clicked. The most common playout of videos is within search results pages. Using Video
Builder, which Amazon launched in 2022, you can easily create videos for Sponsored Brands
video ads using a selection of pre-built, customizable templates. You can customize the look
and feel of your video, as well as edit the color scheme, font, and music. Plus, since 2022, it's
possible to stream video ads to Fire TV, Twitch, or affiliate sites like IMDb.com.
You can read our experience with the Sponsored Brands Video Ads in our blog article
"Our experience with Amazon Sponsored Brands Video".
Important:
Sellers can only create Sponsored Brands or a Brand Store if they have
registered a brand in the Amazon Brand Registry.
The Sponsored Display Ads can be displayed both, on and off Amazon. This depends on the
selected targeting type. Ads are shown based on target audiences or product strategies on
the Amazon homepage, on product detail pages, in shopping results, on Twitch, external
websites, and third-party apps. When the ads are displayed on the product detail page you
can find them below the Buy Box and under the attributes.
The Buy Box is the „box“ with the Call-to-Actions „Add to Cart“ and „Buy now“ at the
right edge of a product detail page.
See the image on the next page
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Example Sponsored Display Ads
When they are displayed on an external page, the Amazon logo and a call-to-action are also
integrated. They link to the product detail pages of the advertised products and can have
different sizes.
The Sponsored Display Ads can be used by sellers with Amazon brand registration, vendors
and agencies with Amazon customers.
They are displayed either based on selected

interest segments, products or page views. For
example, you can target potential customers who
have already viewed your product detail page but
have not yet purchased it. Since 2022, it is also possible
to run Sponsored Display Video Ads. The new format
supports videos up to 45 seconds and helps advertisers
tell their brand story and introduce products to
customers. Learn more about the possibilities with the
new Sponsored Display Ads in our blog article. Beispiel einer Sponsored Display Ad auf externer Seite
Example of a Sponsored Display Video Ad (Source: Amazon)
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4. When are PPC ads displayed?

As already mentioned, there are different ways to display an Amazon PPC ad - based on:
• Keywords
• ASINs
• Categories
• Interests
These are presented here. Not all of the ad formats presented above can be displayed using
each of these four types.
4.1 Based on keywords

Displayed ads based on keywords is the most common form. The ad is displayed when the
search term entered by a potential buyer and the keyword entered by the advertiser match.
Difference between search terms and keywords:

Search terms are queries directly entered by the customer into the Amazon search
field. Keywords are the terms used by Amazon advertisers for a product to be advertised
so that the ad can be displayed - this happens when the search term and keyword
match. A search term does not have to contain exactly the same words as the keyword.
In principle, there are four different match types, so-called match types, which define the
extent to which the keyword and the search term may “difference” in order for the ad to be
displayed. The following table provides an overview of the different match types and shows
the possible search terms that would trigger a display for the English example keyword “hand
mixer white”.
See the image on the next page.
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Beispiel Amazon Match Types
In addition to the positive match types, there are also negative match types or negative
keywords that are used to prevent Amazon ads from being displayed for certain search terms.
a) Auto Match
With Auto Match Type (see Auto Targeting), keywords for which your ads are displayed are
automatically selected by Amazon (based on the product listing).
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b) Broad Match
The Broad Match Type offers the „widest“ match of the ads. In addition to the keyword itself,
Amazon allows other terms before, within or after it. Moreover, the search term can contain
words of the keyword in any order. Even narrow variants such as the plural form of the search
term triggers the ad. Since an ad with broad keywords appears for a large number of search
terms, scattering losses can occur. In the case of Sponsored Brands, an additional closely
related display occurs; for example, in the case of the keyword “sneaker” for the search term
“shoes”. This can be prevented with the so-called Broad Match Modifier via a plus symbol in
front of the keyword. “+Sneaker” prevents the ad of being displayed for closely related search
terms.
c) Phrase Match
The Phrase Match Type is used to display ads that match the keyword itself with the search
term and other terms before or after it. The order of the terms is therefore fixed. Narrow
variants such as the plural form also trigger the ad.
d) Exact Match
The Exact Match Type offers the lowest wastage. Only the keyword term itself and very
narrow variants such as plural or supplementary filler words such as “off”, “in” or similar
allow the ad to be displayed. In this way, advertisers can precisely control the search terms
for which their ads appear.
e) Negative Phrase
With negative phrase all search terms are blocked which contain the negative keyword itself,
the negative phrase or close variants. Negative keywords can contain up to four words.
Negative phrase keywords can exclude a relatively wide range of search terms and should
therefore be used with caution.
f) Negative Exact
If the exact match is negative, Amazon does not display the ad for buyers who are looking for
the keyword itself or close variants such as the plural. Negatively exact keywords can contain
up to ten words.
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4.2 Based on ASINs

Sponsored Product Ads, Sponsored Display Ads and since end of 2019 also Sponsored Brands
can be triggered by ASINs. Instead of keywords, ASINs of products that you want to target are
stored accordingly. These can be ASINs of competitor products or your own products.
If ASINs are targeted with Sponsored Display Ads, the ads are displayed on product detail
pages of the targeted ASINs. Sponsored Brands based on an ASIN are displayed either on the
product detail page of the corresponding ASIN or on the search results page if the targeted
ASIN is displayed organically for a search term on the first search results page. The latter is also
the case for Sponsored Product Ads when ASINs are targeted. In 2022, product targeting for
Sponsored Product Ads was also expanded. With the expanded targeting, you can target
related products in addition to your intended product with one click. For example, if your
targeted product is a camera, the expanded targeting can also include replacement products
such as other cameras, complementary products such as tripods or lenses, and items that were
frequently viewed and purchased along with the camera.
Playout based on ASINs is also called product targeting or product attribute targeting (PAT) and
offers a wealth of opportunities to respond to competitors. More about this can be found in the
3rd part of this PPC guide or in even more detail and with concrete recommendations for
action in our blog article on product targeting.
4.3 Based on categories

In addition to ASINs, categories to which the advertised products belong can also be selected
for the Product Targeting of the Sponsored Product Ads, Sponsored Display Ads and Sponsored
Brands. Further refinements can be made for the displayed ad within a category. In this
way, it is possible to precisely control for which competitor products in a category the own
product is displayed in the form of a Sponsored Product Ad. More about this in Part 3 of the
PPC Guide or in the blog article Product Targeting under the paragraph Category Targeting.
4.4 Based on interests

Sponsored Display Ads can also be displayed based on interests. The advertiser selects the
interests of his target group and the Sponsored Display Ad is displayed on the product detail
page of a product that corresponds to one of the customer interests. The interests are
determined, for example, on the basis of past product views and purchases by Amazon
customers.
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You can also use retargeting with Sponsored Display Ads. Here, ads are displayed on external
pages if a potential customer has visited your own or similar product detail pages in the last 30
days, but has not yet made a purchase.
As described above, not every advertising format presented above supports all four of these
targeting types. Here you can find an overview:
Up to 20,000 ad groups can be created within a campaign, for which up to 1,000 keywords can
be set.
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5. What is the structure of

Sponsored Product
Ads?
The architecture of an Amazon advertising account is as
follows: With a seller account it is possible to manage
several marketplaces such as the english or german
Amazon marketplace. On each marketplace it is possible
to create advertising campaigns. Within a campaign,
campaign, up to 20,000 ad groups can be created, for
which up to 1,000 keywords can be entered.
For a long time, ad groups existed only for sellers in

Seller Central. In the Advertising Console, keywords were
directly integrated into the campaigns. Since the end of
October 2019, there have also been ad groups for
vendors. Each ad group is given its own Match Type and Structure of an Amazon advertising account
the keywords are assigned to the corresponding ad
groups depending on the Match Type.
5.1 Automatic and manual campaigns

The most common goal of advertisers is to be found for all relevant keywords and to appear on
the first search result page. When using “Sponsored Products”, advertisers can select
automatic campaigns (Auto Targeting) or manual campaigns (Manual Targeting). While
Amazon automatically displayed the ad for suitable keywords in Auto Targeting, the seller
himself determines the keywords to be advertised in a manual campaign.
5.1.1 Auto Targeting

Amazon obtains the keywords in the auto campaigns from the listing of the product (product
title, attributes, description, etc.) as well as from the categories to which the product belongs.
The quality of the keywords can vary greatly and is usually not complete. All products in an
auto campaign are displayed using the same keywords. Irrelevant keywords can be added as
negative keywords.
Automatic Targeting is easy to use and start, but does not provide precise control, as it is only
possible to bid on all possible keywords at ad group level (or for four automatic targeting
groups presented in Part 3 of the PPC Guide). One way to control automatic campaigns in a
more targeted way is to use keyword management. This means that keywords that perform
well or less well are transferred from the auto campaign to a manual campaign and added
as negative keywords in the automatic campaign. More about this in the section “Keyword
management and bid adjustments” in chapter 8.1 of this guide.
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5.1.2 Manual Targeting

In manual campaigns, keywords - as the name suggests - can be inserted manually. Auto
campaigns can also be used to find keywords that “work” well or poorly and then transfer
them to manual campaigns as keywords for further optimization.
Since auto campaigns usually only cover a small part of the relevant search queries of custom-
ers, you should additionally conduct your own keyword research and supplement your
manual campaigns with further relevant keywords
Important:
The manual campaigns are much more important for the success of your
advertisements than the auto campaigns, because only in manual campaigns bids for
individual keywords can be set and adjusted individually.
This fine control in Manual Targeting, however, requires a precise structure within the
campaigns:
As already described above, the manual campaigns can have the Match Types Broad, Phrase
or Exact. The advertiser can decide the structure of a campaign himself - either a campaign
contains several ad groups or each ad group has its own campaign. We recommend the latter,
as some advanced settings and the budget are only possible at campaign level, giving you
more control. For more information, see the section “Keyword management and bid
adjustments” in Chapter 8.1. With each of these campaigns or ad groups, the keywords are
structured according to Match Types.
Our recommendation is to create four campaigns with the four Match

Types Auto, Product Targeting (ASINs), Broad, Exact for one product.
Each of these campaigns contains the corresponding keywords which, depending on their
performance, can be transferred from Auto to Broad and from Broad to Exact after some time.
In exact campaigns, keywords can be optimally controlled with individual bids. If a search
term has performed well in a broad campaign and has been transferred as a keyword into an
exact campaign, you should not forget to set the keyword as „negative exact“ in the broad
campaign. Thus, the ad is only triggered by the exact campaign keyword and the clicks can be
clearly assigned to this campaign.
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Recommended campaign structure
You have now learned the most important basics of Amazon advertising and can start with
advertising campaigns. Read Part 2 of our PPC Guide in which we explain step by step how to
create a Sponsored Product Ad in Seller Central.
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How to start
your ads
6. How do I start Amazon Advertising?

As sellers, advertisers must operate a professional seller account and own the Buy Box of a
product in order to be able to advertise Amazon at all. For vendors, Amazon Retail must own
the Buy Box to display Sponsored Product Ads. The display of Sponsored Brands is independent
of the ownership of the Buy Box. If you own the Buy Box, you should follow the steps
below.
Status quo analysis: Is your product “Retail Ready”?
Before you start marketing a product, you should invest time in preparation and check whether
the product you want to promote is qualified. This will drastically increase the efficiency of all
further steps.
According to a study by Feedvisor, almost 90% of Amazon customers

would not consider buying a product that has less than an average of
three stars as a rating.
6.1 Optimization of the product detail pages for the qualification

of products
The relevance of Sponsored Products is based on the organic ranking and the product informa-
tion stored by the Amazon merchant.
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In order to become relevant for the Amazon algorithm A9, all self-influenceable information-
should be optimized. Das sind:
Product title Terms of delivery

Attributes Complete product data
Product pictures Price
Description (A+ Content) Backend keywords
Reviews Customer feedback
Response time
The result of good search engine optimization (SEO) is to appear within the organic search
results on the first page. As long as this is not the case, Sponsored Product Ads will help
to become visible to potential customers in important places. A search engine optimized
product listing is also important for Amazon advertising. On the one hand because Amazon
classifies the ASIN as more relevant and on the other hand because clicks on the ad and sales
are more likely if the product detail page is of high quality (all necessary information as well
as product images etc. are available).
6.2 Calculation of the Break-Even ACoS

There are different performance values with which the success of PPC ads can be measured.
A well known value is the Advertising Cost of Sale (ACoS), which is the ratio of advertising
costs to advertising revenue. It provides information about the efficiency of advertising, but
not about absolute costs or revenues. The individual key figures are explained in more detail
in the section 8.2 “Performance values” of this PPC Guide. At this point, the importance of the
so-called Break-Even ACoS is explained. Before you create an advertisement, you should always
know the Break-Even ACoS of each advertised product, as this tells you the value above
which your advertisement is unprofitable.
However, it is not possible to give a general answer from when advertisement is generally
profitable, as each product has a different margin. What is a very good ACoS for one merchant
can be an unprofitable value for another.
In order to determine the profitability of a campaign, the Break-Even ACoS of the

product must be known. This is the value at which the costs incurred in selling a product,
including advertising costs, are the same as its turnover. Neither profit nor loss is achieved.
The Break-Even ACoS is calculated by deducting all taxes, costs and fees from the sales price
of the product as a percentage. If the profit margin of the seller with product X after deduction of
all costs is 21%, for example, the seller with an ACoS of 21% makes no loss for this
product - but also no profit. For this product and its campaigns, the ACoS should therefore be
below the value of the Break-Even ACoS of 21% in order to achieve profit with advertising. We
have visualized this in the following figure.
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von 21% liegen, um Gewinn mit der Werbung zu erzielen. Dies haben wir in folgender Abbil
dung visualisiert.
Calculation of Break-Even ACoS
It is important that you know the Break-Even Acos before you start your advertising
campaign to see if it is profitable and if not, to be able to give in accordingly.
Note:
Of course, you can also consciously choose to act with a higher ACoS value.
This depends on your individual strategy and can make sense depending on
the life cycle of the product.
6.3 Keyword research
In order for your Sponsored Product Ads to be displayed, you must specify the keywords or
ASINs for which your ad should be displayed.
As explained above, the keywords in auto campaigns are automatically integrated by the
Amazon algorithm. As this is often not sufficient for a target-group oriented displayed ad, you
should definitely do your own keyword research. For this you can either use a tool or carry
out a manual search. We recommend doing both at the same time.
Consider both Fat-Head and Long-Tail keywords.
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So-called Fat-Head keywords consist of only one or two words and usually have a
high search volume and high competition.
Long-Tail keywords often contain a whole key phrase - several words - and usually
have a low search volume and little competition.
Despite the rather small search volume, Long-Tail keywords are important because they often
generate a high sales rate.
Tip:
Fat-head keywords are usually particularly suitable in a broad campaign to
identify Long-Tail keywords and then transfer them into an exact campaign.
You can also use Amazon itself to help you find relevant keywords. In its search box, terms
entered by customers are displayed in descending order of search frequency when a word is
entered.
Amazon search box
Amazon Brand Analytics has also been available since February 2019. Thus Amazon reveals
the most searched terms on the Amazon platform. Since categories and time period can be
filtered, Brand Analytics can be used for your own and seasonal keyword research.
However, with the help of this search term report, you can also identify current trends. Who
doesn't remember the huge hype around the series Squid Game? About a week after the series
came online on Netflix, the term "Squid Game" was in 4th place in the search frequency rank.
In addition to current trends, the seasonality of certain products also has a significant impact
on the search frequency ranks. This can be seen well on Mother's Day or Valentine's Day.
Before the respective events, the search terms "Mother's Day gift" or "Valentine's Day gifts" rise
significantly in the ranking.
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In addition to the most popular search terms, Amazon also displays the three ASINs that were
most frequently clicked on Amazon for this specific search query. In addition, the respective
click and sales share is also displayed for these three products.
Sellers can therefore search for their own ASINs and see after which search queries users have
frequently clicked on their products. In addition, they can see the click and revenue share of
their products, if they are among the top 3 ASINs. In this context, it is of course particularly
exciting to determine which competitors are listed for the same keywords and how high their
click and sales share is compared to your own. You can then attack these competitors with ads,
for example. Those who recognize trends in time can also push corresponding products and
thus profit from the trend. Merchants should therefore regularly check the search term reports
from Brand Analytics.
Before major sales events, such as Prime Day or Black Friday, you should also determine which
keywords are currently ranking high. If you sell products from one of these categories, you
should advertise them additionally or increase your budgets and bids for existing ads.
If you use Brand Analytics properly, you can take advantage of search trends and adjust your
ads accordingly.
Read our article “How to find the most relevant Amazon keywords” for a step-by-step guide to
optimal keyword research.
6.4 Target definition

There are some Amazon merchants who launch Amazon ads without realizing exactly what
they intend to do with them. This makes it difficult to find the right strategy for each product
to advertise. On the other hand, individual campaigns can be more difficult to evaluate in
terms of their success or failure.
So for each product you want to promote, set a goal before you start advertising. These
are goals such as increasing sales, maximizing profits, awareness, etc. Depending on which
target you choose, you will define different advertising formats as well as budgets, bids and
target values.
This also depends on the status of your product in the product life cycle.
25
Product Lifecycle
After a product launch, for example, it can make sense to first introduce the product with
high daily budgets and an aggressive strategy. Profitability does not have to come first. Once
the product is established, the ACoS and profit should be kept in mind. In the decline phase,
high bids can be used to try to catch the few interested parties for the „discontinued“ product
before the competition. Or you pay more attention to the fact that the advertisement remains
profitable and accept little amount of impressions.
Also the decision for an advertising format depends on which goal you aim for with the
advertisement. Sponsored Brands are therefore ideal for creating brand awareness and
making your brand known. Sponsored Display ads, on the other hand, can be used to generate
additional sales and increase sales when advertising products that complement the targeted
product.
7. How do I create a Sponsored Product

Ad?
After the optimization of the product listing and the keyword research have been completed
and the target has been defined, you can start building campaigns.
Since the Sponsored Product Ad is the most widely used advertising format on Amazon,
the creation of an ad of this format in Seller Central is described below.
26
Sellers can create Sponsored Product Ads within Seller Central and vendors can create
Sponsored Product Ads within the Advertising Console (formerly AMS or Amazon Marketing
Services). The interfaces look similar
7.1 Create a campaign

After logging in, click on "Campaign Manager". By clicking on the "Create Campaign" button, a
campaign will be created. After that, set up the campaign and select the following data:
• Ad group name
Ad groups can be used to organize and manage ads within a campaign. So you can assign the
campaigns to specific ad groups.
• Products
Select the products for which you want to create the ad.
• Targeting (Automatic targeting or manual targeting)

You can - as an easy start - start with an automatic campaign and immediately, or after a few days at
the latest, create manual campaigns with the help of Amazon's search term report. With the search
term report, you can see which keywords triggered which search terms for your ads. You will use
these search terms as keywords in the manual campaign. However, we recommend creating manual
campaigns directly with detailed keyword research so you can make adjustments to each keyword as
quickly as possible.
If you select automatic targeting, you still need to set a default bid or set bids by targeting group. If
you select manual targeting, next you need to specify whether you want to target keywords or
products. Next, you must then store corresponding keywords or ASINs. Then, depending on your
selection, you can set negative keywords or ASINs.
• Set bidding strategy

The next step is to select the campaign bid strategy. You can choose from the following bid strategies:
• Dynamic bids - down only.

Amazon lowers bids when the ad is unlikely to generate a sale. This has been applied to all
campaigns prior to 2019 and is also our recommendation.
• Dynamic bids - up and down
Amazon increases bids (up to 100%) when it is likely that the ad will generate a sale and
decreases bids when it is unlikely.
• Fixed bids
Amazon does not change your bids depending on the likelihood of a sale.
27
You can read more about the advantages and disadvantages of bidding strategies in the
corresponding section "Dynamic bidding strategies" in Part 3 of this guide. henden Abschnitt
“Dynamische Gebotsstrategien” im 3. Teil dieses Guides.
You also have the option to "Adjust bids by placement". This can increase your bids by up to
900% if your ad has a chance of being placed within the first search results page or on a
product detail page. Find out which strategy is best for the different match types in our
Case Study.
• Campaign settings
Think about a consistent, easily identifiable naming syntax. This includes ASIN, match type, and
focused strategy e.g. SPA | {SKU} | {ASIN} | {Short Title} | {Match Type} ] | {Focus}
Choose a start date and optionally an end date, or let the campaign run indefinitely. We recom-
mend the latter. You will also need to set a maximum daily budget.
After that, click "Start Campaign" and your Amazon Sponsored Product Ad is ready. If you have
not already done so, we recommend that you transfer search terms from the Auto campaign as
keywords to a Broad as well as an Exact campaign and make the appropriate bid adjustments.
Likewise, the bids of the targeting groups in Auto campaigns (e.g. replacement targeting) should
be adjusted upwards or downwards depending on the performance. The next goal is also to
identify good and bad performing keywords in the Broad campaign and to transfer them to an
Exact campaign in order to be able to increase and decrease their bids individually to enable
precise control.
28
7.2 Create ad groups

You can then create an ad group as a seller in Seller Central within the campaign. Enter a
name for this and select only products for an ad group that are very similar, for example, all
children of a parent ASIN, since they receive the same keywords. In principle, the relationship
between the performance of a product and the keywords within the ad group or campaign
is lost if there is more than one product. Similar products therefore often display variations
according to size or colour.
For auto campaigns, you can now either define only the “Ad group default bid” at ad group
level or define individual bids for four automatic targeting groups.
The bid is the maximum bid you are willing to pay for one click. We recommend working with
crooked bids and starting with 0.27 EUR or the maximum CPC. This is calculated as follows:
max. CPC = RRP x Conversion Rate x Target ACoS
The Conversion Rate can first be derived from the total sales from the business reports in
Seller Central.
Automatic targeting
The Conversion Rate for advertising is on average up to 50% lower than the organic Conversion
Rate.
29
How to optimize
your advertising
8. How to make Amazon ads more

successful
The main problem advertisers face is non-optimized advertisements. This can be due to
wrong campaign structure, wrong targeting or the neglect of optimizing the keywords and
bids on a regular basis. Especially the last point is one of the most important factors for the
success of Amazon Advertising.
8.1 Keyword management and bid adjustments

Keyword management and bid adjustments are basically interdependent. Therefore, it is
important to keep a close eye on the performance of the keywords with the different match
types. The aim should be that individual keywords that perform well or less well from auto,
broad or phrase campaigns are transferred as keywords into more precise campaigns. In
exact campaigns they can then be better controlled with individual bids.
Important:
The keywords that perform well should be assigned higher bids so that the chance of
even more purchases is increased. The bids for poorly performing keywords should be
lowered accordingly so that unprofitable displayed ads and thus advertising costs are
reduced.
If the search terms were not transferred into the corresponding exact campaign but the
30
AMAZON PPC GUIDE | HOW TO OPTIMIZE YOUR ADVERTISING Bid
keyword bid in the broad or phrase campaign would be increased or decreased, this bid
change would be valid for all search terms that match the keyword. This would either
generate unnecessary costs or fail to take advantage of revenue opportunities.
Amazon‘s ads are dynamic, i.e. their performance can change in real time depending on
competition bids and click and sales figures. It is therefore obvious that the performance
indicators of advertising campaigns must be regularly monitored in order to be able to react
to changes.
Analyze your search terms and keywords regularly and apply the keyword transfer process as
often as necessary.
Important:
Adjustments should not happen spontaneously (after 1-2 clicks or one day), but on
the basis of long-term clicks gained from the past. This means that a certain number
of clicks is required to recognize a pattern in the search and click behavior of
customers. So give your campaigns some time to generate enough clicks and orders
before you start making adjustments. After 72 hours, more than 80% of sales are
assigned to the click, so it makes sense to look at the sales-related key figures from
then on.
8.2 Performance values

The most significant advantage of online advertising is the ability to measure success. With
this measurement option, it is easy to see which ads perform well and which don‘t. Unlike
Facebook or Google advertising, Amazon does not require the complex implementation of
a pixel or the values of the individual conversions - Amazon automatically does this for all
advertisers.
As good and bad performance values have often been mentioned above, the most important
key figures for the performance evaluation of Amazon advertising are again explained
here. These are:
Click-Through-Rate (CTR)
Cost per Click (CPC)
Advertising Cost of Sale (ACoS)
Conversion Rate (CR)
31
a) Click-Through-Rate (CTR)
Two of the relevant basic metrics are impressions, which is the amount the ad has been
shown to customers and clicks, which is the amount of clicks on an advertisement. The first
important ratio called Click-Through-Rate (CTR) indicates how many customers clicked on an
ad after seeing it. This can be calculated by dividing the number of clicks by the amount of
impressions.
The closer this value approaches 1, i.e. 100%, the better. It means that the ad was interesting
for potential customers and they wanted to know more about the advertised product. At first
glance, the search term and the product therefore seemed to fit together well. In addition,
the product image and the product title seem to have been well chosen.
Which value is good and which is bad is not clear and depends on the goal and the campaign
orientation. For example, a campaign that focuses on competitive products will probably have a
relatively low CTR, as customers who are looking for a product from a particular brand will
probably be less likely to click on the product from a competitive brand.
Note:
Our clients‘ campaigns have an average CTR of 0.3%. This means that out of
1000 potential customers who saw your ad, 3 people clicked on it.
b) Cost per Click (CPC)

Each click on an advertisement costs the advertiser a certain amount. This amount is called
cost per click (CPC) and comes about through Amazon‘s second price auction process. Each
keyword has its own cost per click. The more your competitors bid for a keyword per click,
the higher your bid must be in order for your ad to be displayed. This also increases your cost
per click for the corresponding keyword.
To calculate the average cost per click of a campaign, the costs of the individual clicks are
added and then divided by the number of clicks.
32
Tip:
Supposedly high CPCs should be accepted for important keywords. These
are keywords that are responsible for many sales. You can calculate how
high your maximum CPC should be in order to remain profitable with the
following formula: Max. CPC = RRP x Target ACoS x Conversion Rate.
Max. CPC = RRP x Target ACoS x Conversion Rate.
c) Advertising Cost of Sale (ACoS)

One of the most prominent KPIs related to Amazon Advertising is the above mentioned
Advertising Cost of Sale (ACoS). This describes the ratio of advertising costs to revenue from
advertising. What a good or bad ACoS is depends on your Break-Even ACoS, i.e. the point at
which you generate profit with your advertising.
Basically, every campaign, ad group and even every keyword has an ACoS. Depending on
which ACoS you want to calculate, simply add up the advertising costs of your campaign or
ad group and divide them by the sales you made with the corresponding ads.
Note:
Our clients‘ campaigns have an average ACoS of 17%. This means that you
spend on average 17 euros on advertising to achieve 100 Euro turnover
through advertising.
d) Conversion Rate (CR)

The Conversion Rate shows how many customers have ordered after clicking on the ad. To
calculate the Conversion Rate the amount of orders is divided by the number of clicks.
33
If the Conversion Rate is relatively low, you should take a closer look at your product and
listing. Doesn‘t the product hold what the product title suggests? Isn‘t the description sufficient?
Also check similar competitive products and compare them and their appearance with
your own.
Note:
Our customers‘ campaigns have an average Conversion Rate of 8%. This
means that out of 100 potential customers who clicked on your Sponsored
Product, eight also bought it.
To be able to interpret the performance values correctly, it is important to understand

that they cannot be evaluated as good or bad in general. Each campaign can have a different
goal - depending on which campaign is considered, different performance values can
therefore be important and “good”.
Please note that sales include all products in the seller‘s inventory or brand within the Advertis-
ing Console (for Sponsored Brands). With the report on the purchased products, sellers
have an insight into how often the advertised ASIN itself was actually purchased. Please also
consider that the costs are always and everywhere displayed as net values and the sales
in Seller Central can also be displayed as gross values; this depends on the activated sales
tax calculation service (VCS) of Amazon. Vendors always receive net values as sales figures.
In addition, the ACoS is useless for many vendors because they have a fixed selling price to
Amazon and only a few participate in the selling price. Here it is advisable to compare the
sales generated with Amazon with the advertising costs.
9. Further possibilities for the

optimization of Sponsored Products
In addition to keyword management and regular bid adjustments, Amazon offers its advertising
customers certain setting options in order to place the Sponsored Product Ads more
specifically for the target group.
9.1 Dynamic bidding strategies and bids by placement

Since the beginning of 2019, advertisers have been able to choose from three bidding
strategies and thus decide whether they want to reduce or increase their bids in percentage
terms depending on the sales chances. Amazon evaluates the opportunity in real time based
34
on past customer behavior. This makes it possible for bid advertisements to be increased if,
for example, a customer who is particularly eager to buy makes a relevant search query. By
contrast, bids can also be lowered if a customer is less likely to buy. If you don‘t want this, you
can set the “Fixed bids” option.
In addition to the dynamic bid adjustments, bids can also be increased by their placement
chance (bids by placement), if an ad has the chance to be displayed within the first search results
or on a product detail page. The percentage by which bids can be increased or decreased
depends on the strategy and placement. If the “down only” strategy is set, a bid reduction of up
to 100% is possible. With the setting „up and down“ for placements on the first page, bids can be
additionally increased by up to 100% and for placements on product detail pages by up to 50%.
If additional it is worked with bids by placements, an increase of up to 1,900% is even possible for
placements on the first page.
Adjust bids by placement and bidding strategies
We have carried out a case study on the selection of the optimal bidding strategy and
recommend that you use the “down only” strategy. Although the Conversion Rate for the
“Up and down” strategy is highest on average, it is at the expense of a significantly lower
ACoS value. For the placement bids, we do not recommend an increase for automatic
campaigns, a 104% increase for the first search results for broad and exact campaigns with
halved CPCs and a 304% increase for product campaigns with quartered bids. You can find all the
advantages and disadvantages of these recommendations in our Case study.
35
9.2 Strategic Product Targeting

Another way to make your advertisements more successful is Product Targeting or Product
Attribute Targeting (PAT). Use PAT to pursue an efficient competitive strategy, because with
your Sponsored Product Ads you can target specific products. This means that you are
displayed on the product detail pages of competitors that you can determine yourself. We
recommend that you develop individual strategies for your top products and thus „attack“
your competitors. For example, show your 5-star rated products on the product pages of
competitors who have fewer stars. Also use prime shipping as a competitive advantage and
target your products with prime shipping on competitor products without prime shipping.
Such measures can lead customers at the end of the purchase decision process to order your
product instead of a comparable product from the competition.
We also recommend that you target your own products to increase a customer‘s shopping
cart value and thus increase your sales. You can do this by placing additional products on the
detail pages of your own products.
Which strategies are possible in detail with product targeting and which settings you have to
make exactly, you can read in the blog article "Product Targeting: Target competitive product
pages with your own products".
9.3 Automation
For both, sellers and vendors, Amazon is a time-consuming business division that requires
goodbroad knowledge. Starting from lacking knowledge on how to set up a campaign to the
optimization of large portfolios with thousands of products, it is almost impossible to manage it
manually.
The analysis of the individual performance values is decisive for the success
of advertisements. Only then keywords can be optimally controlled and bids
adjusted.
Since the performance of Amazon Advertising can change in real time depending on competition
bids as well as click and sales figures, the analysis and optimization process must be run
through regularly.
Since the manual administration of keywords and their bids is probably one of the most
time-consuming activities in the optimization of Amazon advertising, it is often neglected.
Among other things, the transmission of keywords is indispensable for their success, since
it is only possible in manual campaigns to control individual keywords individually with a
maximum cost per click.
36
The solution is to automate this analysis and control by a PPC automation tool. An algorithm
continuously checks the performance of the advertising campaigns and reacts accordingly. Bid
adjustments can be made on the basis of a self-defined target ACoS per campaign
or product. If you want to learn more about how keyword management and automated bid
adjustments work with BidX, check out our knowledge base articles.
Try BidX for free
37
Contact us
If you would like to learn more about optimizing
your ads through automation or have other questions +1 332 334 3657
about Amazon advertising, please contact hello@bidx.io
us via email or phone. Follow us on facebook and
LinkedIn to stay up-to-date and get the latest
information about Amazon advertising.
About BidX
We offer a software solution for merchants on Amazon to automate and optimize PPC
advertisements. The sellers and vendors use their advertising budgets more efficiently,
increases profits and are relieved of a considerable amount of time. Relative advertising costs
are reduced by up to 32% in the first 8 weeks alone. Numerous international merchants and
agencies from 42 countries are relying on our solution.
BidX Inc. • 101 Avenue of the Americas • New York, NY 10013 • USA
www.bidx.io hello@bidx.io +1 332 334 3657 Social-Media:

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Phone: +1 332 334 3657

2. Why should Amazon sellers advertise?. . . . . . . . . . . . . . . . . . . . . . 6

3. What Amazon Advertising formats do exist?. . . . . . . . . . . . . . . . . . 7

4. When are PPC ads displayed? . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

5. What is the structure of Sponsored Product Ads? . . . . . . . . . . . . . 18

How to start your ads

7. How do I create a Sponsored Product Ad? . . . . . . . . . . . . . . . . . . 26

How to optimize your advertising

9. Further possibilities for the optimization of Sponsored Products . 34

1. What is Amazon PPC?

1.1 How does Amazon PPC work?

Requirements to place Amazon advertisements

2. Why should Amazon sellers

A glance at the search results page reveals

Amazon PPC measures are also

Furthermore, important key performance indicators (KPIs) such as the number of

3. What Amazon Advertising formats do

• Sponsored Product Ads

3.1 Sponsored Product Ads

Example Sponsored Product Ads

3.2 Sponsored Brands

See the image on the next page

Example Sponsored Display Ads

They are displayed either based on selected

Example of a Sponsored Display Video Ad (Source: Amazon)

4. When are PPC ads displayed?

4.1 Based on keywords

Diﬀerence between search terms and keywords:

See the image on the next page.

Beispiel Amazon Match Types

4.2 Based on ASINs

4.3 Based on categories

4.4 Based on interests

5. What is the structure of

For a long time, ad groups existed only for sellers in

5.1 Automatic and manual campaigns

5.1.1 Auto Targeting

5.1.2 Manual Targeting

Our recommendation is to create four campaigns with the four Match

Recommended campaign structure

6. How do I start Amazon Advertising?

Status quo analysis: Is your product “Retail Ready”?

According to a study by Feedvisor, almost 90% of Amazon customers

6.1 Optimization of the product detail pages for the qualification

Product title Terms of delivery

6.2 Calculation of the Break-Even ACoS

In order to determine the profitability of a campaign, the Break-Even ACoS of the

Calculation of Break-Even ACoS

6.3 Keyword research

Consider both Fat-Head and Long-Tail keywords.

Amazon search box

6.4 Target definition

7. How do I create a Sponsored Product

7.1 Create a campaign

• Targeting (Automatic targeting or manual targeting)

• Set bidding strategy

• Dynamic bids - down only.

7.2 Create ad groups

max. CPC = RRP x Conversion Rate x Target ACoS

8. How to make Amazon ads more

8.1 Keyword management and bid adjustments

8.2 Performance values

b) Cost per Click (CPC)