- Advertising on Amazon is an auction system where sellers bid on search terms and the seller with the highest bid and is eligible for the Buy Box usually wins the auction.
- Then, when a shopper searches that term on Amazon, that advert will be served to them, creating an impression.
- As a brand or retailer advertising on Amazon, you will not pay for the Sponsored Product or Sponsored Brand advertisement until the customer clicks on the advert itself.
- The Pay Per Click (PPC) adverts then drive customer traffic to Amazon product detail pages.
- When it comes to Sponsored Products, you can differentiate your bids and view the performance of these according to three placement groups: top of search, rest of search, and product detail pages.
- Top of search refers to the adverts in the top of the first page of search results.
- Rest of search refers to the adverts shown in the middle or at the bottom of the results page and in the second page of the results and beyond.
- Product detail pages refer to the placements on those pages, and certain other placements off search results like the Add to Cart page.
- In addition to selecting a bidding strategy, you can also set bids according to placement.
- You can enter a percent increase (between 0-900%) to your base bid for two placements: top of search and product detail pages.
- When you do this, your bids will increase by the specified amounts when your adverts compete for opportunities on those placements.
- It is for this reason that these placement adjustments are also referred to as placement multipliers.
- This setting can be used to increase the visibility of your adverts and generate additional impressions for a specific placement.
- It is important to note that it is possible that bidding by placement can negatively impact your Advertising Cost of Sales (ACOS), as you are bidding higher just for placement and not necessarily increasing conversion.
- The maximum default bid is the cost per click you are willing to pay when someone clicks an advert from the advert group.
- This bid will apply to all clicks unless you have set a customized bid for an individual keyword in this campaign or advert group.
- Setting custom cost-per-click bids is optional.
- The formula for calculating the advert group default bid is ACOS Target x Product Price x Conversion Rate.