Basics

What is Amazon PPC?

Before Sellerwerk really clicks, it helps to understand how Amazon advertising actually works. This article is for you if you've never run an Amazon ad before.

The short version

Amazon advertising runs as an auction. Shoppers type a search term into Amazon — e.g. "stainless steel water bottle". In milliseconds, Amazon decides which ads appear at the top of the search results. That decision is an auction between every seller who has bid on that search term.

How the auction runs

You launch a campaign and tell Amazon: "For the search term stainless steel water bottle, I'm willing to pay up to $0.80 per click." That's your bid. Three things happen:

Amazon collects every bid on that search term — maybe 50 sellers bidding between $0.30 and $1.50.
Amazon checks relevance— does your product match the search term? Does it have good reviews? Do similar shoppers convert? A bad match won't win, even if your bid is high.
Amazon picks winners— the top 4-6 ads appear in the search results. The winner doesn't pay their max bid, they pay one cent above the next-lowest bidder (Vickrey auction).

What you actually pay

You only pay when someone clicksyour ad. Impressions (showing your ad in the search results) are free. That's why it's called PPC = Pay Per Click.

Example: your max bid is $0.80, the next bidder bids $0.55 — you pay $0.56 for the click. Your average CPC (Cost Per Click) in reports shows the actual click cost, not your max bid.

Why your bid isn't everything

Beginners often think: "I'll just bid more and win." Only partly true. Amazon prioritizes sales per 1,000 impressions. An ad with a low bid but high conversion rate can beat an ad with a high bid and bad conversion rate.

What this means for you:

Good reviews (4+ stars, 50+ ratings) make your ads cheaper per won click.
Clear product image + price on the detail page increase conversion and lower CPC.
Relevant keywords (you sell water bottles, you bid on water bottles — not mugs) win the auction more often than irrelevant keywords with higher bids.

What Sellerwerk does in this picture

Sellerwerk does not turn your ads on or off — you do that in Amazon Seller Central. We monitorthe performance of your running campaigns and surface problems you'd otherwise have to find manually:

Which keywords spend money without converting (bleeding keywords).
Where your bid is too low to win the auction at all.
Where your campaigns cannibalize each other (two of your campaigns bidding on the same search term).
Which new search terms are profitable and worth adding as permanent keywords.

We give you suggestions and — if you want — automated rules that run actions overnight (e.g. pausing bleeding keywords). Every action is traceable in the audit log.

Three terms that now make more sense

Sponsored Products — the most common ad type. An ad for a single product that shows up in search results.
Keyword— a search term you bid on. "Stainless steel water bottle" is a keyword.
Match Type — how exactly your keyword has to match the actual search term. More on that in Match Types — when to use which.

If you look at the dashboard now and aren't sure about a number: Glossary — 50 terms explains every acronym. For specific questions: support@sellerwerk.de.