An Amazon ad optimization strategy is a repeatable system for deciding where ad money goes across Sponsored Products, Sponsored Brands and Sponsored Display. It rests on a clear account structure, search term harvesting from automatic and broad campaigns into exact match, bid rules tied to target ACoS or TACoS, placement and budget adjustments based on data, and a fixed review rhythm. Scaling comes from moving proven terms into controlled campaigns, not from raising every bid.
Start with targets, not bids
Optimisation needs a definition of success. Two numbers matter most on Amazon. ACoS (advertising cost of sales) is ad spend divided by ad-attributed sales. TACoS (total advertising cost of sales) is ad spend divided by total sales, including organic.
Calculate break-even ACoS from your margin: if profit before advertising is 30 percent of the selling price, a 30 percent ACoS means ads break even on those sales. Then set targets per goal. A launch product may accept a high ACoS while it builds reviews and organic rank. A mature product should usually run below break-even, with TACoS stable or falling as organic sales grow.
How should the campaign structure look?
A clean structure separates discovery from performance, so each campaign has one job and bids can be controlled.
- Automatic campaigns: discover search terms and ASINs. Use the four auto targeting groups (close match, loose match, substitutes, complements) with separate bids if needed.
- Broad or phrase match campaigns: further discovery around core keywords.
- Exact match campaigns: proven search terms with precise bids. This is where most profitable spend should end up.
- Product targeting campaigns: competitor ASINs and categories, plus your own ASINs to defend product pages.
- Branded campaigns: your brand terms, kept separate so their low ACoS does not hide weak non-brand performance.
- Sponsored Brands and Sponsored Display: brand visibility and retargeting, judged against their own targets.
Name campaigns consistently, for example “SP | Kettle | Exact | Performance”, so reports can be filtered quickly.
Search term harvesting: the core loop
Download the Search Term report from Advertising > Reports (Sponsored Products, search term) every week or two. It shows the actual customer searches that triggered your ads.
- Terms with several orders at an acceptable ACoS: add them as exact match keywords in a performance campaign.
- Add the same terms as negative exact in the discovery campaign they came from, so the two campaigns do not compete.
- Terms with many clicks and no orders: add as negative exact or negative phrase. Decide the click threshold based on your conversion rate; if one in ten clicks usually converts, twenty clicks with no sale is a clear signal.
- Converting ASINs from automatic or product targeting campaigns: add to a dedicated product targeting campaign.
This loop moves spend steadily from broad discovery to controlled exact targeting.
What bid rules should you follow?
Bid changes should follow simple rules based on enough data, rather than daily reactions.
A common rule set, used here as an example:
- If a keyword has enough clicks and ACoS is well above target, lower the bid by 10 to 20 percent.
- If ACoS is well below target and impression share looks limited, raise the bid by 10 to 15 percent.
- If a keyword has no conversions after a click threshold, lower the bid sharply or pause it.
- Do not change the same keyword more than once a week.
Amazon’s own bidding strategies matter too. “Dynamic bids – down only” lowers bids when a conversion is unlikely, “up and down” can raise bids by up to 100 percent for top of search placements, and “fixed bids” keeps them steady. Many advertisers use down only for discovery and up and down for proven exact campaigns.
Amazon also offers rule-based bidding and budget rules in the console, which can automate some of these adjustments within limits you set.
Placement adjustments
Sponsored Products ads appear in three placements: top of search (first page), rest of search and product pages. The Placement report shows performance by placement for each campaign.
If top of search converts much better for a campaign, add a placement adjustment, for example +30 percent, and review the effect after two weeks. If product pages bring clicks without sales, lower the base bid and keep the top of search adjustment. Placement adjustments multiply with dynamic bidding, so watch actual costs per click after changing them.
Budgets and dayparting
Campaigns that run out of budget early in the day miss sales. The campaign manager shows when a campaign was out of budget and the estimated missed clicks. Move budget to profitable campaigns that run out, before raising bids anywhere.
Budget rules can raise budgets on high-traffic days such as Prime Day or a set schedule. Dayparting, through Amazon’s schedule-based budget rules or third-party tools, can lower spend in hours that rarely convert, though on many accounts the gains are modest.
How do you scale without losing control?
Scaling works when proven keywords and ASINs carry most of the spend and discovery continues in the background. Signs that a product is ready to scale include stable ACoS on exact match keywords, a healthy conversion rate (check Business Reports for unit session percentage) and enough inventory to support more sales.
Ways to scale:
- Raise budgets on exact match campaigns that hit target and run out of budget.
- Expand into related keywords found in harvesting.
- Launch Sponsored Brands video campaigns for top keywords.
- Add Sponsored Display retargeting for product page viewers.
- Expand to new marketplaces once the home marketplace is stable.
Scaling stops working when the listing itself is weak. Optimising ads on a listing with poor images, few reviews or an uncompetitive price only spends money faster.
A weekly optimisation routine
- Review spend, sales, ACoS and TACoS by product.
- Harvest search terms and add negatives.
- Apply bid rules to keywords with enough data.
- Check out-of-budget campaigns and move budget.
- Review placement data for the top campaigns.
- Note every change in a log with the date.
Keeping a change log
Amazon results move for many reasons: competitor promotions, stock-outs, price changes, review shifts and seasonality. Without a record of your own changes, it is impossible to tell which effect came from which cause. A simple shared sheet with the date, campaign, change and reason solves this.
Review the log each month next to performance. Over time it shows which bid steps, placement adjustments and harvesting thresholds work for your products, and that knowledge becomes the real core of the strategy.
Where to start this week
Download the last 30 days of the Search Term report for your top-selling product. Find every search term with at least two orders and move them into a new exact match campaign, adding them as negatives in the source campaigns. Then calculate your break-even ACoS and set a written target for that product. With those two steps in place, every later bid change has a reason behind it.
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