Amazon Sponsored Products: Bidding and Targeting Strategies

By January 17, 2020 May 7th, 2020 Amazon Sponsored Products

Amazon Sponsored Products are one of the best ways to drive traffic to your product pages and increase your revenue. However, there are millions of sellers on Amazon and the number keeps growing. To effectively use Amazon advertising, you need to be smart with your bidding and targeting strategies. Read on to learn some techniques you can use to maximize your return on investment.

Amazon Sponsored Products: A Brief Overview

If you’re reading this, you most likely are already familiar with Sponsored Products ads. However, just in case you aren’t, the following is a quick overview.

Amazon offers several pay-per-click advertising options. The most popular of these are Sponsored Products ads. As the name implies, these are ads for individual products that show up as listings in Amazon search results and a few other places labeled as “sponsored.”

Where Your Sponsored Product Ads May Appear in Amazon's Search Results

They are a way to pay for better positioning on Amazon results than you may be able to achieve organically. With so many items listed on Amazon, this can be an essential channel for sellers. Your ad has several targeting parameters, most notably keywords, as well as some bidding parameters. These help you control when the ad is displayed and how much you pay for it.

Amazon Sponsored Products Targeting Options

There are a few ways to target your sponsored product campaigns. One of these options is between manual product targeting and automatic targeting:

  • Product Targeting: This feature allows you to target your ads based on specific ASINs (products listed on Amazon) or product categories. Using this manual option, you have more control compared to automatic. However, this also requires more expertise to get right.
  • Automatic Targeting: You can also let Amazon do your targeting for you. When you set this up, you set some keywords and products you want to target and choose how closely you want to match them. Amazon will then place your ad where it thinks it will be most relevant to your targeting parameters.

If you target specific ASINs on Amazon, your Sponsored Products ads will appear primarily as related items for the targeted ASINs. They may also appear in search results and a few other places if a buyer searches for that specific ASIN.

Maximizing the impact of your ASIN targeting campaign is fairly straightforward: you want to find the highest converting ASINs. Typically, the best way to do this is to run an automatic campaign for a while to gather data. Then look at your Sponsored Products Search Term Report and find the ASINs that have a high conversion rate and target them.

Product Category Targeting

You can also use product categories for Sponsored Products ads targeting. As you likely already know, Amazon has categories and subcategories you can associate with your products. Buyers use these to find products and Amazon sometimes automatically categorizes their search results based on their search terms.

You likely want to target the category of your product. However, you may want to target a related category if the main one is very competitive. You can refine your category targeting based on price and star rating. Consider targeting your ads against products that are less competitive than yours. For example, if you have a cheaper alternative pair of shoes, target slightly more expensive but comparable pairs of shoes.

Brand Targeting

Similar to category targeting, you can also target specific brands. This can be a great way to attract buyers who may be looking at competitor products and brands. Again, you can refine this using price ranges and star ratings. Consider targeting competitors who are spending a lot on Sponsored Brands ads. You can leverage their marketing budget to help get your ads in front of more eyes.

Keywords Targeting:

When you use automatic targeting, you can select keywords that you want to use to target your ads. You can choose between Broad, Phrase and Exact targeting. The former only requires that your keyword appears in the search term. “Phrase” requires that it appear in the correct word order but may have other words included. “Exact” needs to be an exact match for your keyword.

OpSeller Amazon PPC Keyword Performance

(Above Chart: OperationROI’s OpSeller Tool at work)

ASIN Product Targeting

Refining your keywords and how closely they need to match is easiest with data. Consider running some smaller campaigns with relatively broad search terms. Then, find the ones that converted well and refocus your campaign around those effective keywords.

Amazon Bidding Strategies

Getting your Sponsored Products ads in front of the right eyes is important. Equally important is making sure you are spending the right amount of money on each click. These are your bidding strategy options:

  • Fixed: In this setup, you manage your own bids. They will not be adjusted based on the likelihood of conversion. This is the best way to have maximum control, but you may miss some opportunities. Typically, this option is only advisable if you want to increase awareness as you may be overspending if your goal is converting sales.
  • Dynamic (Down Only): This option lets amazon adjust your bids down to increase your efficiency. You can avoid overspending on ads, but you won’t be able to take advantage of more expensive opportunities.
  • Dynamic (Up and Down): With this option, Amazon can automatically adjust your bid in either direction. This can greatly improve the chance of converting. However, you have much less control.

Managing your Amazon bidding strategies will help you optimize your advertising cost of sale. It is the key to making the most of your budget.

Get the Help You Need

Amazon bidding strategies and targeting are not easy to manage. If you want to make the most of your Sponsored Products ads, OperationROI can help. We offer Amazon PPC management services that will help you maximize your profits while selling on Amazon. Contact us today to learn more.

To learn more about OperationROI, find us on DesignRush and read the article from Top E-commerce Development Companies about the Top eCommerce Consulting Companies.

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