[Ultimate Guide] Amazon PPC Advertising Strategies and Tips
In this article, I am going to discuss “advanced” Amazon PPC strategies. I put advanced in quotation marks because the strategies here are not that advanced. But I am not going to sell you the benefits of using paid Amazon advertising. I am going on the assumption that you understand that Amazon is increasingly a pay-to-play marketplace.
- Types of Amazon Advertising
- Sponsored Products
- Automatic Campaigns
- The Secret to Success: Peel, Stick, & Block
- Manual Keyword Targeting Campaigns
- Manual Product Targeting Campaign
- Using Software or Agencies to Manage PPC
- Organizing Your PPC Account and Properly Using Portfolios
- How Much Should You Spend on Amazon Advertising?
- Other Advertising/Marketing Options on Amazon
Related Listening: Podcast 147- Amazon PPC Step-by-Step Guide
Types of Amazon Advertising
There are several main types of advertising on Amazon:
- Sponsored Products
- Sponsored Brands (Previously Headline Search Ads)
- Product Listing Ads/Product Targeting Ads
- Sponsored Display
- Miscellaneous other ‘exclusive' advertising options for select merchants
Sponsored products are by far the most powerful part of paid advertising with Amazon so I will devote the majority of the article to this.
A well-structured Sponsored Products campaign will consist of the following specific campaigns:
- Automatic keyword campaign
- Manual keyword campaigns with a Manual Exact Match Keyword Campaign and a Manual Broad Match Keyword Campaign
- A manually targeted product campaign Sponsored Brands
With automatic campaigns, Amazon guesses what keywords are relevant for your listing. It's mostly very accurate but requires consistent grooming. There are two reasons why your account must use automatic campaigns:
- Automatic campaigns are the best way to get your products to appear in the Sponsored Products related to this item section of an Amazon product listing. Manual keyword targeting will not have your products shown on this section of a listing.
- Automatic campaigns are the best way to harvest keywords that can be used not only for your Amazon Manual Keyword campaigns but also Google Ads.
How Does Amazon Determine My Bid Cost? Can I Bid Against Myself?
Amazon has an auction system for bidding on keywords but the highest bidder does not necessarily win.
Much like Google Ads, Amazon assigns a Quality Score to your ads. The higher your quality score, the low your CPC costs; the lower your quality score and the more you'll pay.
Your Quality Score is determined by your conversion rate, Click-through-rate (CTR), sales-history, relevancy, etc. Unfortunately, unlike Google, Amazon does not allow you to see your Quality Score at this time.
Despite popular opinion, Amazon does not allow you to bid against yourself across products and campaigns.
The Secret to Success with Sponsored Products: Peel, Stick, and Block
The key to having a profitable automatic campaign is to be constantly adding negative keywords to your campaigns. For the first 3-6 months of creating a campaign, I am adding new negative keywords each month. This is a fundamental part of a Peel, Stick, and Block strategy (thanks for the terminology AdBadger)
The basis of this strategy is as follows:
Peel: Peel your best-performing keywords and ASINs from an automatic campaign
Stick: Stick them to either a Manual Keyword Campaign or Manual Targeted Campaign
Block: Block these keywords (add them as a negative match) to your Automatic Campaigns
The goal of this strategy is to maximize your exposure for high converting keywords and bid as granularly as possible.
Manual Keyword Targeting Campaigns
I let my automatic campaigns run for approximately 30 days and then I review a keyword report from my automatic campaigns to peel the best keywords (and ASINs but I'll discuss that later) from the report. You can download these reports from within the Advertising Reports section of your Seller Central account.
Once you download your reports open them in your favorite spreadsheet app. Filter the sheet to include only one product's automatic campaign and then sort by 7 Day Total Sales. I then peel any keywords that have more than one sale in 30 days and that are below my target ACoS.
So for me, I would remove the keywords atv rear storage and atv rear cooler and add these into Manual Keyword campaigns (see below). I will then block these keywords as negative exact match into my automatic campaigns.
What's with all these ASINs in my reports?
At this point, you may have noticed a bunch of ASINs under Customer Search Term. These ASINs are competitor's product listings that Amazon automatically displayed your ads on. We will use these ASINs for our Manual Product Targeting Campaigns below.
Creating Manual Campaigns and Bidding
See our list of common non-converting (“garbage”) keywords that you should add as negative keywords to all of your campaigns.
I now have a list of high-converting keywords. We now stick these keywords into two types of campaigns:
- Manual Exact Keyword Campaigns
- Manual Broad Keyword Campaigns
If you want to maximize ROI and/or are lazy, you can eliminate Manual Broad Keyword campaigns altogether (I also do not typically use Manual Phrase Keyword campaigns because these are effectively covered under our Manual Broad Keyword campaigns).
The keywords in the Manual Exact Keyword Campaigns are then blocked as Negative Exact Match keywords in our Manual Broad Campaigns.
Keyword Match Types 101: Exact, Phrase, Broad
As per Amazon, the different types of keywords can be defined as follows:
Exact: Exactly matches the keyword or sequence of keywords
Phrase: Contains the exact phrase or sequence of keywords.
Broad: Contains all the keywords in any order and includes plurals, variations and related keywords.
Assuming the keyword is garlic press, the following keywords would/could be triggered.
Even in an Exact Match campaign, you must be very careful using Manual Broad as Amazon will use variations and related keywords. Amazon will guess related keywords and variations and can often guess wrong (i.e. garlic powder could potentially be triggered for the keyword garlic press). Be vigilant and monitor your Exact Broad campaigns.
Manual Product Targeting Campaign
In November 2018, Amazon rolled out Manual Product Targeting. Product targeting allows you to target your ads to appear on competitors' listings under “Sponsored Products Related to this Item”. Previous to this update, the only way to have your ads placed here was through Automatic Campaigns and you had no control over what items your ad appeared in.
Product targeting campaigns may appear in the same location as Sponsored Products in addition to under the Buy Box and below bullet points. However, 90% of the time they are going to appear somewhere on a Product Detail page such as below.
How to Set Up Manual Product Targeting
Setting up these ads is easy.
- Create a manual campaign and choose Product Targeting.
- Take your high-performing ASINs generated in your automatic campaigns and paste them into the Individual Products field (shown above). Note, you will have to convert all your ASINs to Upper-Case (use excel function =Upper()).
- Copy these ASINs to the Individual Products list.
In addition to targeting by ASIN, Amazon allows you to target by category and other variables. In my experience, targeting by these wider variables on Amazon such as through Product Listing Ads they almost always perform terribly and I do not recommend targeting like this.
Given how well individual product targeting has performed in Automatic Campaigns and Product Listing Ads, you can expect these campaigns to perform equally as well.
Sponsored Brands (Formerly Headline Ads)
Sponsored brands are the ads that appear on the top of search results pages. They appear in groups of three, meaning that you need to have at least three products to advertise.
Amazon suggests several bidding strategies for Sponsored Brands. In my experience, the successful keywords from your manual campaigns will perform, more or less, equally as well for Sponsored Brands. Subsequently, I do not recommend bidding on complementary products or out-of-category keywords as Amazon does.
In my A/B testing, Sponsored Brands has a higher ACoS than Sponsored Products and will result in far fewer sales.
Send Sponsored Brands Traffic to Landing Page or Store Page?
When you are creating your Sponsored Brands ad, you have a choice to send traffic to a New product list page consisting of three products OR to an Amazon Store Page. Sending products to a New product list page will almost always convert better than an Amazon Store Page unless it is a branded search term you're bidding on (i.e. Nike, Apple, etc).
Organizing Your PPC Account and Properly Using Portfolios
One of the most important parts about having ANY well-performing PPC account – be it Amazon or Google – is to have a well-structured and organized account.
Amazon made this far easier in late 2018 when they rolled out portfolios. Portfolios allow you to organize your campaigns into various groups and quickly see a snapshot of that group's performance.
The most common organization technique is to have every Portfolio contain all of the advertising campaigns for one product. So, for example, my Portfolio ATVBG-00 will contain all of the campaigns shown below.
I like to start all of my campaigns with the same keyword and add in parenthesis the type of campaign after (i.e. Manual Exact Keyword). This makes comparing the performance of each campaign very easy and also allows me to quickly see if I've forgotten a particular type of campaign for a product.
How Much Should Spend on Advertising?
This all brings up an important question: how much should you spend on advertising?
I did a survey of 5 higher volume sellers. For most sellers, advertising tended to account for 25-35% of their total Amazon sales. Newer brands tended to have an advertising account for more of their sales. This is consistent with both my personal experience and talking to other sellers off the record.
When deciding on a target ACoS, for newer brands (<6 months old) I like to bid up to my break-even ACoS. On the other hand, for older brands (>6 months old) I like to bid up to half of my break-even ACoS. In other words, for an older brand, I pay half of my gross profit on advertising.
So for example, if I have a widget for $30 and make $5 gross profit per item this means I can have an ACoS of 16.67% and break even. Once the brand is established (> 6 months old) I would bid up to 8.335% ACoS. If I have a greater gross profit on an item I can, of course, pay more on advertising.
Amazon Dynamic Bidding and Placement Bidding
In early 2019 Amazon rolled out something called Dynamic Bidding and Placement Bids (which replaced the former Bid+). These are accessible through your Campaign Settings.
Dynamic Bidding adjusts your bids up if it's likely to result in a sale. Placement Bids allow you to pay a premium for appearing at the top of search results and on product pages.
Dynamic bidding is similar to Enhanced CPC in the Google Adwords world. Normally smart bidding like Enhanced CPC or Dynamic Bidding results in a marginal increase in sales but a dramatic increase in advertising costs. I suggest you DO NOT turn on Dynamic Bids – up and down and instead select Fixed bids or Dynamic bids – down only as your bidding strategy.
Placement bidding is a different story. Much like I recommended using Bid+ I also recommend that you SHOULD use Placement Bidding.
In previous tests, enabling Bid+ (now called Placement Bidding) increased sales by about 67% on those campaigns and increased the ACoS by around 24%.
Dynamic bidding now gives you much control over bidding and similar or better results should be expected.
For most advertising campaigns Product Page Placements will produce most of their sales but have the highest AcoS while Top of Search Placements will have the lowest ACoS and slightly less sales.
Most people are going to find that they're OK bidding a little more for Top of Search and would prefer to pay less for other placements. There is no way to lower a bid adjustment – you can only raise it. Subsequently, if you want to lower your bids for a particular placement you will need to lower your campaign/keyword bids and then increase your bid adjustments by an equal amount for other placements to ensure those placement bids are not also lowered.
Using Software or Agencies to Manage PPC
There are a number of software tools available to help manage your Amazon PPC including Sellics, Cash Cow Pro, and countless others. These tools can definitely help automate your bidding, blocking poor-performing keywords, etc. and I personally use Sellics for my brands. However, these are all tasks that can be easily done by an individual (either yourself, a staff member, or VA).
In terms of using an agency, it's my firm opinion that delegating any paid traffic campaign management to an agency normally sees very poor results, after the initial setup stage of the account. For almost all companies (especially smaller companies) PPC is best managed in-house.
Other Advertising/Marketing Options on Amazon
Amazon has a plethora of other advertising options, mostly available through Amazon Advertising, not available to most third-party sellers. These include:
- Sponsored Display
- Category sponsorships (entire category sponsorships)
- Video advertising (through Prime video and elsewhere)
- Off-Amazon display advertising
Sponsored Display is the only real other advertising option that is viable for most average sellers at this time. The other advertising options mentioned above are more restricted and also often have very large minimum purchase requirements.
Sponsored Display ads essentially allow you to retarget your products off of Amazon. It was released as a beta in early 2019 and rolled out to the masses later in the year. Amazon promises that eventually you'll be able to get some fairly granular targeting with it, but as of this writing the targeting is very limited. In our brief testing and talking with others, results have been fairly limited.
This guide should give you the basics of a smooth-running advertising account for all of your products.
Do you have any questions or comments regarding setting up and running your campaigns? Post a comment below.
Great article, I hadn’t done the new category targeting but was thinking it wouldn’t perform very well being so broad – thanks for sharing your thoughts on it so we don’t have to test/spend on it ourselves! Bid + was also an interesting read in this article – could be a good use case for launch.
Yep – Bid+ can be useful for product launches where more sales is more important than profitability :)
Dave, awesome post!
Do you know when is the best time to turn on Bid+? Are there specific times that you like using that feature?
Any time your ACoS can bear the increase (it will increase your ACoS significantly) is a good time. So if you’re campaigns are really profitable but you just can’t get enough sales. With that being said, the holiday season most people’s campaigns ACoS goes up significantly, so now is probably not a good time to tinker with it – I’d wait until January.
Great stuff! Thanks!
You’re welcome :)
Thanks for the guide! I need to get my Amazon PPC campaigns set up so this came at the perfect time.
You’re welcome Jason :)
Thanks, great tips Dave. Two questions.
1. In a manual campaign, what do you set the default bid at? i.e. if you have 10 target keywords with different bid prices. Am I right in saying individual keyword bids override the default bid?
2. I’ve set a few manual campaigns recently but they fail (dismally) to get many impressions, even when targeting your 2-3 main keywords for that specific product. I’ve read that many people see a similar issue. Meanwhile, the auto campaign for similar search terms is clocking up 1000s of impressions. Go figure!
Sorry for the late reply Jamie!
1) All of our campaigns are profitable (the benefit of being in a niche that is not ultra competitive) so we set bids at Amazon’s recommended top end). We’ll monitor them over time and drop them to try and get them to our target ACoS.
2) Yes – you’re not the only one. I’d try making sure your manual campaigns are set to phrase at least (and perhaps even broad) and of course upping your bids. For longer tail keywords getting impressions is always a struggle though.
Thanks Dave! I did end up setting phrase and upping the bids and it’s had an impact with reasonable conversions too. Happy holidays.
Have a query on brand/trademarks but I’ll get back to you in the early new year.
I have quite a lot Amazon experience but never executed PPC at its best, so after Podcast 147 (by the way you should write that down too…) I was really happy to have such a great step by step guide on PPC, just signed up on Sellics and working it all out following your clear path.
Just one question regarding moving Keywords from Auto to Manuel Campaigns, at Podcast 147 you mentioned that any keyword that had 1 sale you moving over to Manuel, but here you added that only keywords that’s under your target ACOS,
If so, what do you do with the ones that’s over your ACOS, (and the ones with no sales at all) straight into Negative? Or you still give them another chance (in the auto campaign)?
If a keyword has 1 sale but it takes a million clicks to get a sale, it should negatived. Of course, in reality, decisions are quite this black and white and some level of discretion needs to be used. But overall yes, they need to be generating at least 1 sale AND be doing it profitably.
This is such a helpful article, I cross reference it all the time when setting up campaigns.
Thanks Tom – I appreciate your appreciation.
Hey Dave and Mike,
Great articles and podcasts on setting up PPC campaigns! One of the best set of tutorials I have come across yet. One question for you. How many keywords are you including in each manual campaign? Are you using just one keyword per campaign for easy measurement purposes or do you have multiple KW per campaigns for ease of maintenance?
Normally I have 3-10 keywords per campaign.
Thank you guys for all the help here and on the show!
You’re welcome Ron and thanks for the kind words!
Great info on PPC, Dave!!
For your auto campaigns keywords that have at least 1 sale,, you add then in your manual campaigns and the add as “negative exact” in your auto. Is there any reason you don’t add them as “negative phrase”” since you have a “manual broad” campaign that will capture it? That’s the way I’ve been running mine.
Yes, I’d add them as Negative Broad to the Manual Broad campaign (and Negative Exact to the Manual Exact). I should have made this more clear.
The article is go good. I feel I was doing this all wrong. Thanks so much.
Quick Question on campaign organization – If I got this right, as a starting point you are suggesting to have auto campaign setup for all the skus and move them to manual strategically based on performance. What if you have same keyword that gives you sale on 2 or 3 different skus. Curious how I should proceed in that scenario
I’d have to wrap my head around the implications of this as we don’t have any keywords where this is a situation for us. I’d probably just add them to each product in a manual keyword campaign. The caveat is that you’re bidding against yourself so keep this in mind.
Awesome and extensive guide – bookmarked!
Thanks Mike and Dave for this guide. I really needed this! Amazon is only one of many sales channels that I need to work on in 2019 but this is a great guide to get me going.
Glad it helped Troy!
Hey Dave, this has been great. Is there a reason you separate out your Manual (Broad) and Manual (exact) into separate campaigns? Any benefits of doing so? I’ve been putting my manuals in the same campaign?
You can bid more aggressively on Manual (Exact)
Great article. I hope I could read this earlier.
I have a question about the auto-targeting campaign.
I have a lot of ASINs there without any conversation and they are wasting a lot of money.
But I was told they are not blocked even I added them to the negative list.
How could you stop these money-wasting ASINs in auto-targeting advertising?
Unfortunately you can’t block them.
I’m very new to PPC and was just flying by the seat of my pants. I literally took every piece of advice in this article and have applied it. I can’t believe you’re giving this granular level of instruction out to the masses for free. Amazing.
Thanks for your instructions.
You mentioned keywords that generate no sales from auto AD should put to negative keyword in auto campaign. Should I add them as “negative exact” / both “negative phrase” & “negative exact”?
Just negative exact.
An Ultimate Guide. This includes Amazon advertising strategies which will be more helpful for advertisers to promote their Amazon marketing. Thanks for sharing this content.
Thanks for sharing the amazon advertising detailed guide.