{"id":3682,"date":"2022-04-04T03:07:54","date_gmt":"2022-04-04T07:07:54","guid":{"rendered":"https:\/\/onecommerce.io\/blog\/?p=3682"},"modified":"2023-04-12T05:53:59","modified_gmt":"2023-04-12T09:53:59","slug":"amazon-bidding","status":"publish","type":"post","link":"https:\/\/onecommerce.io\/blog\/2022\/04\/04\/amazon-bidding\/","title":{"rendered":"Amazon Bidding – Everything Advertisers Want to Know in 2023"},"content":{"rendered":"

The process of looking for products on Amazon begins with shoppers searching for keywords and scrolling through the search result pages to find the perfect one.\u00a0<\/span><\/i><\/p>\n

So, advertisers should use the correct keywords in their Amazon PPC (Pay-Per-Click) campaign to attract shoppers who are interested in their products.\u00a0<\/span><\/i><\/p>\n

However, that\u2019s not everything to reach the right customers with PPC advertisements. It also includes <\/span><\/i>Amazon Bidding<\/i><\/b>. What is it and how does it work? Everything you need to know is right below. Keep reading.<\/span><\/i><\/p>\n

What is Amazon bidding?<\/b><\/h2>\n

Amazon bidding is an auction-based system where advertisers compete for ad placements by bidding on keywords to show their products to potential customers when they search for the keywords.<\/span><\/p>\n

\"Amazon

Amazon bidding is where advertisers fight for perfect places for their ads<\/p><\/div>\n

The advertisers with the highest bid and best-targeting keywords usually win the auction. Your bid, the relevance of your product, and the <\/span>quality of your product listings<\/span><\/a> are factors which determine if you are the winner or not.<\/span><\/p>\n

Learn the basics of Amazon bidding<\/b><\/h2>\n

Formulating your Amazon bidding strategy requires you to have basic knowledge about tracking costs, commission, Advertising Cost of Sale, and which types of ads are best for your campaigns.\u00a0<\/span><\/p>\n

Costs & Commission:<\/b><\/h3>\n

The costs incurred when your bids result in sales (Cost of Goods, Replacement Cost of Goods Sold, etc.) have a great impact on your bidding decisions. Hence, you should pay attention to these costs and add them to the ad group level.<\/span><\/p>\n

\"Costs

Costs & Commission can affect your Amazon bidding strategies<\/p><\/div>\n

The commission is usually around 15 \u2013 20% of product sales, yet it can increase by 45% depending upon the product you are selling. Be aware of these extra charges because some products are not worth advertising when these charges are included.<\/span><\/p>\n

Advertising Cost of Sale (ACoS)<\/b><\/h3>\n

Advertising Cost of Sale (ACoS) is the most common way to measure how profitable your Amazon campaigns are.\u00a0<\/span><\/p>\n

The lower the ACoS, the more profitable the campaign. A lower ACoS of 15-25% is the desired goal achievement. The calculation of ACoS is as below:<\/span><\/p>\n\n\n\n
ACoS = Total ad spend \/ Total Sales * 100<\/b><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

Types of Sponsored ads\u00a0<\/b><\/h3>\n

Sponsored Product ads<\/b><\/h4>\n

Sponsored Product<\/span><\/a> ads are a type of Amazon PPC advertisement that you can see in Amazon\u2019s Search Engine Results Pages and product listing pages. There are two types of keyword targeting strategies used in planning for Sponsored Products ad campaigns.\u00a0<\/span><\/p>\n

Automatic Targeting<\/b><\/h5>\n

Under Automatic Targeting, you can not exert considerable influence over your ad campaign. Amazon chooses how to display it and which customers to target. Advertisers can only set a CPC bid and insert all their relevant keywords.<\/span><\/p>\n

\"Amazon

Amazon will decide where to show up your advertisements based on your option of Automatic Targeting<\/p><\/div>\n

There are four different keyword match types in <\/span>Automatic Targeting<\/b>:<\/span><\/p>\n

    \n
  • Close match<\/b>: Keywords closely related to the products.<\/span><\/li>\n
  • Loose match<\/b>: Keywords indirectly related to the products.\u00a0<\/span><\/li>\n
  • Substitutes<\/b>:\u00a0 Display ads to customers who visit product pages of similar products.\u00a0<\/span><\/li>\n
  • Compliments<\/b>: Display ads to customers who visit product pages of products that complement yours.<\/span><\/li>\n<\/ul>\n

    Pros:\u00a0<\/span><\/i><\/p>\n

      \n
    • Easy to set up<\/span><\/i><\/li>\n<\/ul>\n
        \n
      • Discover new, high-converting, or relevant search terms and products<\/span><\/i><\/li>\n<\/ul>\n

        Cons:<\/span><\/i><\/p>\n

          \n
        • Unable to identify which product or targeting is the most successful as multiple products are present in a single <\/span><\/i>advertisement group.<\/span><\/i><\/li>\n<\/ul>\n
            \n
          • Can\u2019t adjust bids on specific placements<\/span><\/i><\/li>\n<\/ul>\n
              \n
            • No direct targeting of the keywords<\/span><\/i><\/li>\n<\/ul>\n
              Manual Targeting<\/b><\/h5>\n

              Otherwise, with Manual Targeting, advertisers can manually intervene in the process of targeting for these campaigns and even take more control over bids and spending. You can bid either on the ad group level or on the keyword level.\u00a0<\/span><\/p>\n

              Here are three keyword match types for <\/span>Manual Targeting<\/b> you can choose for your campaign:<\/span><\/p>\n

                \n
              • Broad match:<\/b> Your ad will be displayed when a buyer searches for your keywords in any order, in addition to other key terms that are closely similar to your targeting keywords.<\/span><\/li>\n
              • Phrase match: <\/b>Your ad will be shown when a buyer types those keywords in the same order, consisting of suffixes or prefixes.\u00a0<\/span><\/li>\n
              • Exact match<\/b>: Your ad will only be displayed if a buyer uses the exact targeting keywords. The search term will exclude any other words or phrases.\u00a0<\/span><\/li>\n<\/ul>\n

                Pros:<\/span><\/i><\/p>\n

                  \n
                • More precise results<\/span><\/i><\/li>\n<\/ul>\n
                    \n
                  • More control over your ad spend and overall ROI\u00a0<\/span><\/i><\/li>\n<\/ul>\n