Amazon PPC: How to Master it in 2024

It may seem like Amazon is overcrowded for small businesses to Digitalromans, but this actually presents a significant opportunity if you know how to rise to the top—specifically at the top of search results on the platform through Amazon PPC.

One effective way to achieve this is through pay-per-click (PPC) advertising on Amazon. With Amazon PPC, smaller and lesser-known brands can compete on more equal footing with larger, well-established companies. Last year, sellers in the U.S. generated $4.5 billion in sales, which averages out to about 8,600 items sold per minute.

Interestingly, over 60% of these sales were driven by independent sellers, many of whom were small and medium-sized businesses. Whether you’re just starting out or have experience selling on Amazon, leveraging Amazon PPC can significantly enhance your overall sales strategy. This guide on Amazon PPC will break down the essentials for you.

What Is Amazon PPC?

Amazon PPC refers to pay-per-click advertising on the Amazon platform. These ads allow sellers and brands to promote their products by displaying them to interested shoppers within Amazon’s busy marketplace.

Sellers pay Amazon a small fee each time a potential buyer clicks on their ad, known as the cost per click (CPC). CPC plays a crucial role in determining the cost-effectiveness of an Amazon PPC campaign and is a key element in shaping a successful advertising strategy.

The Importance of PPC Advertising on Amazon

Amazon PPC is essential for any seller aiming to be profitable in that retail media space,” says Danielle Russell, senior brand manager at Digital Romans Internet Marketing Agency.

With the surge in sellers over the past five years and the wide range of paid ad placements on Amazon, it has become especially challenging for new product listings to be discovered without PPC.

As of December 2023, Amazon.com dominated the U.S. online marketplace, accounting for 58% of desktop traffic in the marketplace category. In comparison, eBay.com ranked second with 11.86% of visits.

This significant gap in traffic highlights Amazon’s dominant position, offering sellers an unparalleled platform to reach a vast audience while giving shoppers access to almost any product they need.

Boost Visibility and Brand Awareness

A key advantage of Amazon PPC is its ability to boost visibility. With millions of products on Amazon, it can be tough to stand out. PPC ads position your products at the top of search results, ensuring they are seen by potential customers. This prime placement not only increases traffic to your listings but also strengthens brand awareness, helping you build a solid presence in your niche.

Drive Targeted Traffic

Amazon PPC enables you to target specific keywords and product categories, ensuring your ads appear to shoppers actively searching for items like yours. This targeted strategy helps you reach a highly relevant audience, increasing the chances of clicks and conversions. For instance, if you sell bamboo straws, using keywords such as “eco-friendly alternatives to plastic straws” or “reusable straws for drinks” ensures your ads reach environmentally conscious consumers seeking sustainable options.

Boost Conversion Rates and Sales

PPC campaigns can have a direct effect on both your sales and conversion rates. By attracting more targeted traffic to your listings, you improve the likelihood of converting clicks into purchases. Amazon’s algorithms also tend to prioritize products with higher conversion rates, gradually enhancing your organic rankings. In essence, a well-executed PPC campaign can establish a positive cycle where increased sales lead to better rankings, which in turn drive even more sales.

Gain Valuable Insights

Running PPC campaigns offers valuable data and insights. With detailed reports and analytics, you can monitor ad performance, identify which keywords drive the most traffic, and gain a better understanding of shopper behavior. These insights are crucial for refining your advertising strategy and optimizing your product listings. For instance, if “eco-friendly straws” are performing well, you can adjust your listings and future ads to capitalize on this trend.

Enhance Product Launches

Launching a new product on Amazon can be challenging, but PPC can provide a crucial boost. Investing in PPC ads during the launch phase helps generate quick visibility and initial sales, giving your product the momentum it needs to establish itself in the market.

Competitive Advantage

PPC also offers a competitive advantage. With many sellers vying for the same customers, PPC helps you stand out. By strategically bidding on high-performing keywords and optimizing your campaigns, you can outperform competitors and secure a larger market share, which can be especially valuable in competitive niches.

Types of Amazon PPC Ads

Each type of ad provides distinct opportunities to increase product visibility and sales. Let’s explore the three primary types of Amazon PPC ads: Sponsored Product Ads, Sponsored Brand Ads, and Sponsored Display Ads. We’ll examine what they are, when to use them, and how they differ from one another.

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Use Cases:

• Retargeting: Perfect for re-engaging shoppers who viewed your product but didn’t make a purchase.

• Expanding Reach: Ideal for targeting potential customers based on their shopping behavior and interests, whether on or off Amazon.

• Complementary Products: Great for promoting products that complement items a customer has already viewed or purchased.

(Amazon; On where Sponsored Display Ads appear)

Sponsored Display ads offer versatile placements across Amazon and beyond, including thousands of websites and apps. In addition to the Amazon homepage, your ads can appear on product detail pages, Amazon-owned sites like Twitch, and various third-party platforms. Placement is automatically selected based on your targeting strategy and optimized to meet your objectives.

These ads excel at retargeting, making them ideal for re-engaging shoppers and broadening your audience beyond Amazon. By following potential buyers across the web, Sponsored Display ads keep your products top-of-mind and drive conversions even when customers aren’t on Amazon.

Amazon PPC Analytics Metrics To Track

Understanding PPC metrics is essential for evaluating ad performance, refining strategies, and boosting sales. Here are the key Amazon PPC metrics you should be familiar with:

Impressions
Clicks
Cost Per Click (CPC)
Click-Through Rate (CTR)
Advertising Cost of Sales (ACoS)
Attributed Sales

Impressions

Impressions measure how often your ad is shown to shoppers. Each time your ad appears on a search results or product detail page, it counts as an impression.

High impressions suggest good visibility, meaning your ads are frequently seen by potential customers. However, impressions alone don’t ensure success—you need clicks and sales to get a full picture.

Clicks

Clicks represent the number of times shoppers click on your ad, reflecting their initial interest in your product.

Clicks indicate how engaging and relevant your ad is to shoppers. A high number of clicks usually means effective ad copy and targeting, but they need to translate into sales for true value.

Cost Per Click (CPC)

Cost Per Click (CPC) is the amount you pay for each click on your ad, determined by Amazon’s bidding process.

Formula: CPC = Total Ad Spend ÷ Total Clicks

CPC is crucial for managing your ad budget. Knowing your average CPC helps control costs and optimize bids to maximize your advertising spend.

Click-Through Rate (CTR)

Click-Through Rate (CTR) measures the percentage of people who click on your ad after seeing it, expressed as a percentage.

Formula: CTR = (Clicks ÷ Impressions) × 100

CTR indicates how appealing and relevant your ad is to shoppers. A higher CTR means your ad resonates with customers, driving more traffic to your product pages and providing insights for improving ad engagement.

Attributed Sales

Attributed Sales reflect the total sales generated from clicks on your ads, showing the effectiveness of your ads in driving purchases.

This metric is key for assessing the revenue impact of your campaigns. It helps you evaluate ROI and identify which ads or keywords generate the most sales.

Advertising Cost of Sales (ACOS)

ACOS measures the ratio of ad spend to the sales revenue generated from those ads, expressed as a percentage. It helps gauge the efficiency of your advertising spend.

Formula: ACOS = (Ad Spend ÷ Attributed Sales) × 100

A lower ACOS means you’re spending less to generate each dollar of sales, which is ideal for profitability. However, a higher ACOS might be acceptable during brand-building or product launches, where visibility is prioritized over immediate returns.

These metrics work together to provide a complete view of your Amazon PPC campaign’s performance. For example:

• High Impressions + Low Clicks: Your ad is visible but may not be compelling enough. Consider adjusting your ad copy or targeting.

• High Clicks + Low Sales: This suggests your product detail page might not be converting well. Optimize your listings for better results.

• High CPC + Low ACOS: You’re efficiently spending on ads, as each click is leading to profitable sales.

• Low CTR: This indicates your ads may not be relevant to your targeted keywords or audience, warranting a review of your targeting strategy.

Return on Ad Spend (RoAS) is a broader PPC metric, including Amazon. RoAS measures the revenue generated for every dollar spent on ads, and the goal is to achieve a RoAS greater than one to ensure profitability.

By tracking and understanding these metrics, you can fine-tune your Amazon PPC campaigns to boost visibility, engagement, and sales, leading to better business outcomes.

Top 7 Amazon PPC Optimization Techniques

This Amazon PPC guide covers essential strategies, from keyword research to ad creation, campaign management, and tracking.

Here are the top Amazon PPC tips to enhance your brand’s performance:

1. Identify Your Keywords

Start with the basics—your product.

You know your product best, so consider the search terms you’d use to find it. For example, if you offer digital marketing services, relevant keywords might include “SEO services,” “Best Digital Marketing Agency in India,” or “PPC Advertising Agency.”

To expand your keyword list, use tools like Ahrefs’s Amazon Keyword Tool, which can provide valuable insights and suggest terms you may have missed. For instance, it might reveal frequently searched phrases like “sensitive skin moisturizer” or “anti-aging organic cream” that align with your product.

Long-tail keywords—longer, more specific phrases—tend to have less competition and attract highly targeted traffic. While broad keywords like “moisturizer” are competitive, something more specific like “organic moisturizer for sensitive skin” can lead to higher conversion rates, attracting shoppers who know exactly what they’re looking for.

Don’t overlook branded keywords, which include your brand name, specific products, or tagline. Competitors may target these, so it’s important to include them in your strategy.

In your Amazon product keyword research, you should also consider:

• Negative keywords are as important as positive ones. These are terms you don’t want your ads to show for, helping avoid irrelevant clicks that drain your budget. For instance, if you sell luxury organic skincare, negative keywords like “cheap skincare” or “drugstore moisturizer” can help filter out bargain hunters.

• Indirect keywords are related terms that don’t directly describe your product but are still relevant to your target audience. For a skincare line, examples might include “skincare routine,” “best skincare products,” or “skincare tips.” These can attract users in the research phase who might be persuaded to buy your product.

With the right keyword strategy, you’ll be on track to creating more successful and profitable Amazon PPC campaigns.

2. Analyze Your Competitors’ Keywords

Branded keywords include specific brand names and attract highly targeted traffic—shoppers searching for a brand they trust. For example, if you sell fitness equipment, branded keywords could be “Nike running shoes,” “Adidas workout gear,” or “Under Armour sportswear.”

Competitors can bid on your branded keywords to capture potential customers. If your brand is “DeLight,” competitors might bid on “DeLight soy candles” to divert customers searching for your products to their own listings. This strategy allows them to leverage your brand’s popularity to potentially take your sales.

Understanding the keywords your competitors target can give you an advantage. Here’s how to uncover this information:

• Type your product’s main keyword into Amazon’s search bar to view commonly searched suggestions, including generic and branded keywords.

• Use third-party tools like Helium 10, Jungle Scout, or Ahrefs to see which keywords your competitors rank for organically and through paid ads. For instance, Helium 10’s Cerebro tool shows the exact keywords competitors’ products are indexed for.

• Manually review competitor listings. Their product titles, bullet points, and descriptions often reveal the keywords they prioritize. For example, a competitor’s product title might include “handmade soy candles,” signaling important terms for their PPC campaigns.

• Observe sponsored ads that appear during product searches to identify which competitors target the same keywords. If a competitor’s ad frequently appears for a search term, they are likely bidding heavily on it.

• Use Amazon Brand Analytics (if available) to see which keywords drive the most clicks and conversions in your category. This data highlights high-performing keywords used by competitors.

By analyzing these insights, you can discover new opportunities and optimize your PPC campaigns to outperform competitors. Keep track of both branded and generic keywords, and adjust your strategy based on what’s working in your niche.

3. A/B Test Your Amazon PPC Ads

Optimizing your Amazon PPC ads through A/B testing can greatly improve their effectiveness. This method helps you make data-driven decisions, leading to better ad performance and, ultimately, more sales.

A/B testing, or split testing, involves comparing two versions (A and B) of an ad to determine which one yields better results. By adjusting a single variable—such as the ad copy, headline, or image—you can track which version generates more clicks, conversions, or sales. This structured approach allows you to improve your ads based on real user behavior rather than relying on assumptions.

For example, suppose you’re advertising a product called “DeLight Scented Candles” and want to discover which headline resonates more with your target audience. Here’s how you could set up an A/B test:

• Ad Version A: “Fill Your Home with Fragrance with DeLight Scented Candles”

• Ad Version B: “Relax and Unwind with DeLight Scented Candles”

Both ads would run simultaneously for a defined period, and their performance would be monitored. If Ad Version B achieves more clicks and conversions, you’ll learn that emphasizing relaxation appeals more to your customers. This insight will guide future ad optimizations based on actual results.

4. Optimize Your Product Listings

A well-optimized product listing is more likely to rank higher in Amazon search results, grab shoppers’ attention, and convert them into buyers. This process involves refining different aspects of your listing to make it both search-friendly and appealing to potential customers, which can significantly boost sales and improve your PPC return on investment.

Key elements of product listing optimization and how to enhance each one for better visibility and customer appeal:

Images: High-quality images are crucial for catching a shopper’s eye, as many rely on visuals when making purchase decisions. Use sharp, high-resolution photos that show the product from multiple angles, and include lifestyle images that showcase its use. Infographics (not as the main image) can also help highlight important features and benefits.

For example, if you’re selling PeacefulPieces Cork Coasters, high-quality images might include close-ups of the cork texture, as well as different angles to show the coaster’s design and size.

Titles: An optimized product title should be concise, informative, and persuasive. Start with your brand name, clearly state the product, and emphasize key attributes like size, color, or unique benefits. Including relevant search keywords naturally will further improve visibility.

An example of an optimized title: “PeacefulPieces Cork Coasters – Stylish Surface Protection, Natural & Sustainable.”

Descriptions: A compelling product description should go beyond listing features, emphasizing how those features benefit the customer. Incorporate storytelling to create an emotional connection, and ensure relevant keywords are smoothly integrated to boost search ranking.

For instance, for PeacefulPieces Cork Coasters:

“Say goodbye to water rings and enjoy peace of mind with PeacefulPieces cork coasters! Made from all-natural cork, these absorbent, heat-resistant coasters protect your furniture from spills and hot mugs. Picture cozy evenings with friends, knowing your surfaces are safe – PeacefulPieces coasters let you relax and enjoy the moment.”

Bullet Points: Bullet points are a great way to quickly convey key features and benefits. Keep them short and focused, with the most important information at the top. Each point should highlight how the feature improves the user’s experience or solves a problem.

Example bullet points:

• 100% natural oak tree bark: High-quality cork for durable protection without synthetics.

• Absorbent and heat-resistant: Protects surfaces from spills and hot drinks.

• Anti-slip cork grip: Keeps coasters and drinks securely in place.

If writing product descriptions feels overwhelming, don’t hesitate to hire a professional copywriter.

A+ Content: To use Amazon’s A+ Content, you need a professional selling account with advanced features and either be enrolled in Amazon’s Brand Registry or sell non-branded products. A+ Content allows you to include enhanced visuals like images, videos, and engaging text on your product pages, which can boost sales by up to 8% for basic content and up to 20% for premium content, according to Amazon. There are three levels:

• Basic (enhanced images and descriptions)

• Premium (videos and carousels for more engagement)

• Brand Story (highlighting your brand’s mission)

5. Use Amazon PPC Features

Amazon’s advertising platform is equipped with numerous features tailored for both beginners and experienced advertisers. These tools help optimize your campaigns, making it easier to reach your target audience and achieve your business objectives.

One of the most effective features Amazon offers is automated bidding. This feature allows you to set your campaign goals, and Amazon will automatically adjust your bids to meet them. There are several automated bidding strategies:

• Dynamic Bids – Down Only: Amazon lowers your bids when the chances of conversion are lower.
• Dynamic Bids – Up and Down: Amazon raises bids when your ad is more likely to convert and lowers them when it’s less likely.
• Fixed Bids: Your bids remain constant unless manually adjusted.

Using automated bidding saves time and ensures that your ads reach the right audience at an optimal price. It’s also a good practice to increase bids when adding new keywords to an existing campaign.

Another valuable Amazon PPC tool is automated targeting. Instead of manually selecting keywords and products, you can let Amazon handle it. There are two primary types of automated targeting:

• Close Match: Targets shoppers using search terms that closely match your product.
• Loose Match: Targets shoppers using search terms somewhat related to your product.

Additionally, automated targeting can include complementary and substitute product targeting, displaying ads on the pages of related items. This increases the chances of engaging shoppers already browsing products in your category.

Product targeting allows you to directly target specific products or categories on Amazon. This feature helps you target competitors or complementary products that shoppers are already interested in. You can:

• Target Individual Products: Place your ads on the product detail pages of specific items.
• Target Categories: Place ads across multiple product categories, which is beneficial if your product fits into more than one category.

The Manage Your Experiments feature enables sellers to conduct A/B tests on their product detail pages. While not exclusively a PPC tool, it’s useful for overall product listing optimization, which can, in turn, enhance your PPC campaign results. Amazon claims that using this feature can increase sales by up to 25%.

With Manage Your Experiments, you can test variations of product titles, images, and descriptions to determine which performs better. For example, testing two different images can show you which one generates more clicks and sales.

Additionally, there are five essential programs you should take advantage of:

• Brand Registry
• A+ Content
• Fulfillment by Amazon (FBA)
• Automated Pricing
• Advertising in your first 90 days on Amazon

Amazon refers to this combination as the Perfect Launch.

6. Try Sponsored Brands Video Ads

Amazon video ads provide a dynamic way to grab the attention of potential customers and share your brand’s story. Unlike static images or text, video ads allow you to demonstrate your product’s features, explain its benefits, and offer a more engaging shopping experience.

These ads can appear on search results pages, product detail pages, and even on platforms like IMDb and Twitch, giving your product more visibility and appeal.

When creating video ads on Amazon, keep the following tips in mind:

• Keep videos short, engaging, and focused on highlighting your product’s unique selling points with clear messaging and visuals.
• Adhere to Amazon’s video ad guidelines for smooth compatibility.
• Test different video lengths, styles, and messages to determine what resonates most with your audience.
• Monitor view rates, click-through rates, and conversion rates to continuously optimize your video ad strategy.

(Amazon; Video and audio specifications)

While adhering to Amazon’s guidelines for Sponsored Brands video ads, it’s important to strategically experiment with your approach.

7. Track Your Amazon PPC Performance

Data is crucial for optimizing your Amazon PPC campaigns. Analytics provide valuable insights into your ad performance, helping you identify what works and what needs improvement. Key metrics to monitor include impressions, clicks, click-through rate (CTR), conversion rate, and advertising cost of sales (ACOS). These metrics highlight how well your ads are performing and where adjustments might be needed.

Look for trends in your campaign and ad group data to refine your strategy. Analytics can show which audience segments respond best to your ads, allowing you to optimize targeting and allocate your budget to the most profitable segments.

For example, if a specific ad group is consistently underperforming, consider adjusting bids or fine-tuning your targeting.

Search term reports can help you identify high-performing keywords that drive conversions, which you can then add to manual campaigns. At the same time, recognize irrelevant or low-performing search terms and add them as negative keywords to reduce wasted ad spend.

Regularly tracking PPC performance enables you to adjust bids for different keywords and products. Increase bids on high-performing keywords to capture more traffic, and decrease bids or pause ads for those that underperform to save costs.

For deeper analysis, you might consider consulting with an Amazon seller expert.

Bonus Tip: Remember to leverage Amazon organic strategies, such as Amazon Posts. This free tool allows you to use images and videos to showcase products in real-life settings, promoting brand discovery and engagement.

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20 Amazon PPC Terms To Know

Here are key Amazon PPC terms, including some previously mentioned:

Sponsored Products: Ads promoting individual product listings that appear in search results and on product detail pages.
Sponsored Brands: Ads showcasing your brand logo, custom headline, and multiple products, appearing in search results.
Sponsored Display: Ads that use auto-generated display ads to reach relevant audiences both on and off Amazon.
Cost-Per-Click (CPC): The amount paid each time a shopper clicks on your ad.
Impressions: The number of times your ad is shown to potential customers.
Click-Through Rate (CTR): The percentage of impressions that result in clicks, calculated as (Clicks/Impressions) x 100.
Conversion Rate: The percentage of ad clicks that lead to a purchase, calculated as (Orders/Clicks) x 100.
ACOS (Advertising Cost of Sales): The percentage of ad spend relative to sales, calculated as (Ad Spend/Sales) x 100. Lower ACOS reflects better efficiency.
Return on Ad Spend (ROAS): The revenue generated per dollar spent on advertising, calculated as (Sales/Ad Spend). Higher ROAS indicates better performance.
Keywords: Terms shoppers use to search for products; these can be targeted to reach potential buyers.
Negative Keywords: Terms you exclude to prevent your ads from appearing in irrelevant searches.
Search Term Report: A report that shows the exact search terms customers used to find your ads, helping refine your keyword strategy.
Bid: The maximum amount you’re willing to pay for each click on your ad.
Dynamic Bidding: An automated strategy where Amazon adjusts your bids in real time based on conversion likelihood.
Placement: The location where your ads appear, such as at the top of search results or on product detail pages.
Product Targeting: Targeting specific products or categories to display your ads on relevant product detail pages.
Sponsored Brands Video: Video ads in search results that enhance brand awareness and engagement.
Campaign Manager: The tool where you create, manage, and optimize your PPC campaigns.
Portfolio: A feature that allows you to organize and report on groups of campaigns.
Daily Budget: The average amount you’re willing to spend on a campaign each day.

Amazon PPC: Everything You Need To Know

What Is Amazon PPC?