Amazon’s advertising generated $56.21 billion in revenue last year. This year, it’s expected that the online giant will exceed $67 billion, before it reaches a dizzying $79 billion in 2026.
As the third-largest digital advertising platform globally and one of the most sophisticated ones available to online sellers, you can understand why it makes perfect sense to jump onto the Amazon Ads bandwagon.
But if you’re new to the game, figuring out how to advertise on Amazon can leave you a little overwhelmed (to say the least). There are a bunch of things you need to set up and get right, like choosing ad types, figuring out bid amounts, and getting your keywords in order.
Unless you’re an advertising pro and familiar with these terms, you might just turn around, think it’s too much work, and head for the hills. But we urge you not to, because a little effort will go a long way in helping you grow sales. And when you get your Amazon ads up and running in tip-top shape, you’ll be glad you stuck around.
Amazon ads are actually one of the most predictable ways to grow sales fast. Here’s the thing: The people on the platform are already in buying mode. They’re searching and comparing with intent. They’re a moment away from clicking “buy,” and if you do your Amazon ads right, and show up at the right moment, there’s no reason why they won’t choose your product.
But for that, you need to know how to run and set up Amazon ads, and you need a strategy, and that’s exactly what we’re going to give you here. We’re not assuming you’re a PPC expert, so we’ll explain every step you need to take, and consider so you can run rocking ad campaigns on Amazon.
What you need to start advertising on Amazon
Before you run your first ad on Amazon, you need to get set up.
#1 Get an Amazon account
First things first: you need an active Amazon account. You have two to choose from:
- Seller Central: This is for third-party sellers that want full control over pricing, inventory, and branding. It will let you sell directly to customers via Amazon’s marketplace.
- Vendor Central: This is for third-party wholesalers that want to sell products in bulk to Amazon, where Amazon takes care of pricing, inventory and end customer sales.
#2 Select an Amazon seller plan
Next, you need to choose one of the two Amazon seller plan options.
| Plan | Outline | Fees |
| Individual Selling Plan | Best for:New sellersCasual sellersLow-volume sellers (up to 40 items per month)You get access to essential tools (manual listings, order management, and health & sales dashboard) for managing your small online business.Run simple Sponsored Products ads. | $0.99 per item sold |
| Professional Selling Plan | Best for:Well-established sellersHigh-volume sellersScaling sellersYou get access to an extensive set of tools (bulk listings, brand management tools, sales reports) and services to grow an established online business.Run all ad types at scale and get detailed analytics. | $39.99 per month |
#3 Choose if you want Amazon Brand Registry
Amazon Brand Registry is not mandatory, but if you want to leverage the full advertising potential of the platform, you’ll need it.
To get your brand registered on Amazon, you will need to have a registered trademark (or one pending).
Some of the benefits of registering your brand on Amazon include access to premium ad types, such as:
- Sponsored Brands Ads: Use the premium ad format, which appears at the top of the search results page and links back to your Brand Store.
- Sponsored Display Ads: Take advantage of exclusive features for better audience targeting by product or interest.
- Video ads: Run video ads through Sponsored Brands campaigns.
- Branded Store: Allows you to create multi-page, custom-built storefronts.
- A+ Content: Lets you add advanced images, text, and multimedia to your product listings.
Types of Amazon Ads you can choose from
Amazon offers three main types of ad campaigns, where each one is designed to achieve a specific goal for the seller.
Sponsored Products Ads (Boost sales & visibility)
Sponsored Products Ads are the stock-standard, reliable ads that just work. Their concept is simple: show up when and where shoppers are already looking. So think, search results, and on competitor product pages.
In most cases, they work like invisible ads because they blend in so well on the screen that most shoppers don’t even realize they’re ads. Because they pop up at the right time, for the right person, they are perceived by buyers as helpful guides, which is why they drive conversions and deliver results for the seller.
Sponsored Products Ads target buyers in one of two ways:
- Keyword targeting: You bid on the exact keywords people use via search.
- Product targeting: You place your ads on competitor or related products’ listings.
When you combine the two, they’ll hit almost every step of the buying customer’s journey.
Things to keep in mind with Sponsored Products Ads:
- One of the best options for new sellers and those who are new to Amazon advertising
- You don’t need Amazon Brand Registry to use them
Sponsored Brands (Drive brand awareness & store traffic)
Sponsored Brands Ads are a step above because they take you from promoting a single product to promoting your entire brand. As banner-style ads, they show your logo, include a custom headline, and display up to three products. It’s a bit of a mini storefront ad in the search results.
They’re located at the very top of the page, which means shoppers see them first. This prime real estate plays a huge role in grabbing buyers’ attention while they are still deciding. And that’s why Sponsored Brands are highly effective for brand and product launches, boosting discovery, and building recognition fast.
Like Sponsored Products, Sponsored Brands Ads target customers through manual keyword targeting, but also automatic targeting, where Amazon automatically matches your ad to relevant keywords and products (based on your product’s details).
Things to keep in mind with Sponsored Brands Ads:
- You must have Amazon Brand Registry
- Video ads work like a dream for this ad type – brands that combine video and static ads see a 25% higher CTR, and a 10% higher growth in sales(year-on-year)
- When these ads take the buyer to your Amazon Store, they get to browse your entire product offering (this means you increase your chances of higher order value and better repeat rates)
Sponsored Display Ads (Reach your audience on & off Amazon)
Sponsored Display Ads are ideal for retargeting and reaching your ideal shoppers both on and off Amazon. They may have seen your products somewhere but didn’t buy them, and this is your opportunity to remind them you’re still around.
The targeting for Sponsored Display Ads is just keyword-based – it’s automatic and intent based. Amazon reads online shoppers’ behavior by tracking what people browsed, what they compared, and what they almost bought.
Things to keep in mind with Sponsored Display Ads are that they:
- Require Amazon Brand Registry to be leveraged.
- Show up where it matters most: on product pages, review sections, and sites within Amazon’s ad network.
- Get your brand in front of people during the decision-making process.
- Great at bringing back cart abandoners who almost closed and dropped off at the end.
Step-by-step campaign setup process
Now that we’ve explained the basics, let’s get straight into setting up your Amazon Ads campaigns.
Step 1: Access campaign manager
Go to Seller Central and open the Advertising tab. This is where your Campaign Manager lives, and it’s the home base for everything related to Amazon PPC.
Within Campagn Manager, you can:
- Build an ad campaign
- Manage your ad campaign
- Optimize every active ad campaign
To get started, click on Create Campaign and the system will walk you through each setup step and, where possible, it will also give you suggestions (based on past performance, product data, and what’s working across your category).
Much of the setup is automatic. As you make selections, the wizard adjusts automatically, only showing the options you need and hiding the stuff you don’t.
Step 2: Configure campaign settings
For each campaign, it helps if you give it a name that actually makes sense for you. A good way to go about it is to keep it simple and go by product, ad type, and timeframe. This will make it easier to sort and compare performance later on.
Next, make the following configurations:
- Set campaign length: Choose how long the campaign will run by setting an end date. Most advertisers let campaigns run indefinitely, and then they simply jump in and adjust bids during seasonal spikes.
- Set the daily budget: For new campaigns, it’s a good idea to start with $10-$25, and then once you see what is and isn’t working, you can scale up or down.
Just keep in mind that your bidding strategy sets the tone for how competitive your ads are on Amazon.
For beginners advertising on Amazon, one of the safest choices is to go for dynamic bids, where Amazon’s algorithm adjusts your bids in real-time based on the likelihood of a conversion.
Step 3: Select products to advertise
Next up, it’s time to choose which product you want to advertise. Start with the ones that have good reviews (minimum 4-star rating), solid pricing, and great images.
Your ad is your product landing page. It needs to be perfect, and it needs to speak to the buyer. If the images, title, and claims don’t clearly display value, your ad will fail to deliver (even with he best targeting). So make sure you answer every question the shopper has when in the market for that particular product.
A couple of tips to follow:
- Start small: Advertise 5–10 of your best sellers or your top quality products.
- Avoid going broad: Don’t spread your budget across your entire product catalogue – focus on a few products so you get cleaner data and a better understanding of each product’s performance.
Also, as you select products in the platform, you’ll see Amazon highlighting them in green or grey. Products highlighted in green are being recognized as those that Amazon believes have strong ad potential based on the market.
Step 4: Set up targeting
Amazon’s advertising campaigns rely on keywords. So targeting the right keywords is the basis of most advertising initiatives on the platform. But where do you start?
You start by aiming for 15–30 keywords per ad group. The trick here is to actually land the phrases real customers use, not the ones you think they use. Go for long-tail keywords (way better than their short, broad keyword counterparts). These convert much better (and they cost less) than broad, high-competition terms.
Then look at setting up match types. Here you have a few options:
- Exact match: Use exact match for keywords you know convert.
- Phrase match: Use phrase match to uncover new keywords.
- Broad match: Use broad match to discover keywords that might also be relevant, but not obvious.
Another way to set up targeting is through product targeting. This lets you place ads directly on competitor product listings and related products. The idea here is to go for well-established competitors with strong sales. The reason for this is tha they get more traffic, which means more chances for your ads to show up in front of potential customers.
When you’ve got your targeting sorted, Amazon will give you suggested bid amounts. They reflect current market competition and typical conversion patterns, so they’re a reliable reference before you jump in and optimize. So, use these as your starting baseline.
How to land and select the right keywords
Good keywords are the ones that buying customers actually type into search. There are a few ways you can find out what those terms are:
- Amazon’s autocomplete: This is one of the easiest ways to spot real search term behavior. Type a word, watch the suggestions, and there you’ll have the exact phrases people are using.
- Competitors’ listings: Look at titles, bullet points, and backend terms of top sellers in your niche. It’s also a great giveaway of the type of language your audience responds to.
- Stick to buying intent basics: Terms with “best,” “buy,” “review,” or “price” generally mean the shopper is close to closing the deal, and these phrases normally deliver stronger conversion rates.
For your first campaign, start with 20–25 keywords. That will give you more than enough material to work with when it comes to understanding which ones are working and which ones are total duds.
Get your bidding and budget management in order
Bid management is all about getting the balance right between visibility and profit.
Here’s a simple way to approach bidding:
- Start with Amazon’s suggested bids.
- Use the 70/30 rule: Place 70% of your budget on proven keywords and the remaining 30% to test new keywords.
- For the first two weeks: Check your campaigns daily.
- Strong performers: Bump your bids up by 20–50% each week to reel in more of that traffic.
- Low performers: Cut bids by 15–25% before you move them to your negative list.
And finally, keep an eye on your daily budget – if you run out of funds early, you’ll lose visibility during peak hours!
Best practices for campaign optimization
Get into a regular rhythm for performance monitoring
You don’t need to live in Campaign Manager, but you do need to set up a routine.
- New campaigns: Check performance daily for the first two weeks and then revisit weekly.
- Metrics to track: Focus on the three that drive decisions:
- Advertising Cost of Sales (ACoS)
- Click-Through Rate (CTR)
- Conversion rate (CVR)
- Reports to use: Download the search term report weekly and edit your keywords based on what works and what doesn’t.
(Use Amazon’s 14-day attribution window so you’re judging results on complete data, not half-baked numbers.)
Figure out the negative keywords you need to avoid
Negative keywords are the ones that don’t deliver conversions via ad campaigns. Your best bet is to cut this wasted traffic and direct your ad spend to the keywords that are working.
Here, again, your search term report will tell you which ones are which. When you see phrases that trigger clicks but never convert, add them to your list of negative exact matches. That stops you from wasting valuable ad dollars.
Regular monitoring of negative keywords will keep your budget focused on shoppers who actually want to buy.
Measure success the right way
Amazon advertising isn’t about running campaigns that deliver returns today. You want to see how they elevate your entire business over time, through a dedicated and intentional (targeted) effort.
As a benchmark and guide, most profitable campaigns land in the 15–25% ACoS range, but new products may need up to 50% ACoS early on to gain traction.
To get the full picture, look at the Total Advertising Cost of Sales (TACoS). This compares your ad spend to total sales, which includes organic revenue your ads help generate. And when you see TACoS drop while sales climb, you can be sure your ads are pushing actual growth.
Advertising also boosts your organic rankings. So track the positions of keywords weekly. When your ads show in front of the right buyers, your organic visibility generally rises, too.
Common Mistakes to Avoid
- Going broad with your keywords: Starting with high-competition keywords before building a negative keyword list is going to waste your ad spend. Begin with exact and phrase match until you know how your customers actually search.
- Being a scrooge with daily budgets: Daily budgets that are too low, run out early, and this kills your visibility during peak buying hours. Weekends and evenings are high-intent times, so make sure you’ve got ads going in this period.
- Tweaking bids daily: Don’t tweak bids every day. Amazon’s system needs 7–14 days to learn. Constant changes reset that learning and mess up your data.
- Investing in bad products: Ads can’t fix a bad product. Poor reviews, sloppy listings, or bad pricing almost always lead to negative returns. Put your budget behind products that are actually good sellers.
- Ignoring mobile experience: 57% of Amazon shoppers use mobile. If your images, titles, or bullets don’t display well on a phone, you’re losing people before they even scroll.
Make RedTrack your secret advertising weapon and Amazon ads partner
Amazon ads work best when you take a strategic approach and when you dedicate the setup time it requires to get everything in order for a smooth paid ads process.
Once you understand how shoppers search, how keywords work, and how bids behave (and how each ad type pushes customers closer to the buy button), the platform starts to feel a lot less chaotic. It all starts to connect and make perfect sense. You get clearer signals, stronger rankings, and steadier sales, and that momentum carries into everything else you sell.
But there’s one thing advertisers forget: Amazon only shows you what happens inside Amazon. The moment you start getting traffic from Meta, TikTok, Google, influencers, email, or anywhere else, Amazon has no tracking data to show for it. No attribution. No clarity. No idea which external clicks actually lead to those sales. That gap costs sellers serious money.
This is where RedTrack becomes your ad spend saver.
RedTrack tracks every step of your external traffic before shoppers hit Amazon’s product page. You see which ads, audiences, and creators push real intent – and which ones don’t. You can test presell pages, manage influencer links, run partner programs, and understand how much your off-Amazon marketing boosts your Amazon sales.
If you want your Amazon ads to scale smoothly, pair them with the one thing Amazon doesn’t give you: transparency into the traffic you pay for. That’s the role RedTrack fills perfectly.
