Amazon Advertising Cost: What is the Average Cost of Amazon Ads?

In 2022, Amazon ad spend reached $20.6 billion. Amazon is a great place for you to sell your products to interested leads. By taking advantage of Amazon’s advertising program, you can reach even more leads that are interested in your business. On this page, we’ll discuss the different types of Amazon ads and the average cost for ads. Keep reading to learn more about Amazon ads and contact us online to speak with a strategist about starting your Amazon advertising campaign.

P.S. Learn how to strategically include Amazon advertising in your digital marketing budget with our nifty (and free!) budget management guide!

What are the different types of Amazon ads?

When you investigate Amazon’s ad services, you’ll find that there are numerous types of ads you can run on their page. There are two different categories of ads.

  1. Self-serve ads: These are ads that function similarly to Google search ads. You’ll see these ads in search results for products.
  2. Premium ads: Premium ads are more like display ads. They appear as visual banners and sidebar ads.

Now that you know the two categories of ads, let’s dive into the different types of ads that fit into these categories!

1. Sponsored Product ads

Sponsored Product ads are the most commonly used ads on Amazon. These ads typically appear before the organic product listings but can also be seen in the midst of products or at the end of the product page.

With this type of ad, you are trying to get your ad to appear in relevant search queries. The goal is to reach as many relevant leads as possible.

Sponsored ads are tagged with the word “sponsored” or “ad” to indicate paid content. This helps differentiate them from the organic listings.

To get an ad position, you must bid on keywords. Keywords trigger your ad to appear in product search results, so you want to choose the most relevant keywords for your campaign.

There are two options when it comes to choosing keywords. You can either select automatic or manual targeting.

Automatic targeting is driven by the content of the products. Amazon uses your product information to match your ads with relevant search terms. Your ads appear in search results based on the information you use in your product listing.

With manual targeting, you are able to upload a list of keywords you want to target for your ads. This means that you are targeting the exact keywords you know will drive results for your campaign. With this option, there is a higher cost per click (CPC), but the better targeting option typically results in more sales.

Sponsored ads are great for helping your business increase visibility. You only get charged when someone clicks on your ad, so you have more control over your budget and how much you spend on a campaign.

2. Sponsored Brands (formerly known as Headline Search Ads)

Sponsored Brand ads are slightly different than sponsored ads in that you can promote three or more products in your ad. These ads appear in search results as headline banners.

You’ll typically see them at the top of the page, above other individual sponsored ads and organic listings.

Sponsored Brands are used for keywords that are the middle ground between general and specific keywords. For example, someone who searches “cast iron dishes” is specifically looking for dishes made of cast iron, but there is no specification of what type of dish they want.

In this case, a company will create a Sponsored Brands ad and include a photo of different types of cast iron dishes like pots, pans, and baking trays. This helps drive leads to a page that specifically focuses on different cast-iron dishes.

If you have multiple similar products, you can combine them into one ad. This will attract leads that know they want your product, but aren’t sure of the exact product they need.

Think of this in terms of browsing through a store with different options. Your potential customer will be able to make a decision based on what you offer them on your product pages. Using Sponsored Brands ensures that you drive leads to your product pages more efficiently.

3. Product display ads

Product display ads are ads that aren’t focused on keyword targeting. Instead, these ads target people based on their interests.

These ads appear at the top and bottom of pages, as well as customer review pages and in marketing emails from Amazon. When someone sees a product display ad, they see an ad for a product that they would buy or have been considering buying.

When your business runs a display ad, you drive people to your product detail page. It’s a great way to capture leads and get them more interested in your products. This advertising option also functions on the pay-per-click model, so you only pay when interested leads click on your ad.

Advertisers must select from a long list of products to target shoppers. Each campaign you run is limited to one target type of product. You must choose which products you want to advertise to your audience.

The first step to increasing your SMB’s Amazon sales is getting a FREE proposal.

One of our experts will be in touch within 24 hours!

What is the average CPC for Amazon advertisers?

When you get involved in an advertising campaign, you always want to know how much it will cost. On average, Amazon advertisers pay $0.81 for every click on their ad.

The important thing to remember is that the cost is not set in stone. Your advertising campaign costs will depend upon your competition and your budget.

If you’re competing for highly competitive keywords, you can expect to pay more for them. It will lead to a bidding war and drive the price up. You may go above the average of $0.81 because there are multiple companies bidding for certain ad placements and keywords.

Your budget will also affect your CPC. If you have limited flexibility in your budget, it will influence where you set your CPC.

For instance, if you only have $500 to spend on a PPC campaign, it would be better to set a bid of $1 rather than $5. You can get 500 clicks with $1 or 100 clicks with $5. If you want to get as many clicks as possible to attract leads to your products, you must figure out what CPC will work best to maximize your budget.

Get an instant breakdown of your Amazon sales margin with our free calculator.

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How can you lower your CPC?

When you lower your CPC, you get more clicks for your budget. This leads to more valuable leads finding your business’s products. So, how can we help you lower your CPC?

1. Choose the right keywords

Lowering your CPC starts with choosing the right keywords. When you select your keywords, you want to select ones that will drive valuable leads and have a low CPC.

We can help you find the right keywords for your campaign. Our team will conduct keyword research to optimize your campaigns and help you find the right keywords for your products. We know how to conduct keyword research to find the right keywords to help your products reach more leads.

2. Optimize product listings

If you want to earn valuable leads for your business, you must optimize your product listings. The more relevant and informative your product listing is, the more conversions you’ll earn for your business.

When you partner with us, we’ll help you optimize your product listings. We’ll help you provide valuable information for your audience that gets them to choose your business over the competition.

We’ll help you integrate keywords, optimize your title, and provide your audience with important key features to get them interested in your products. Our team can help you create product listings that drive better traffic to your page.

3. Monitor your campaign’s performance

When you run your Amazon ad campaign, it’s critical that you monitor your campaign to see if it is working. You don’t want to spend all your money on a campaign that isn’t optimized to drive the best results.

Our team of 500+ experts will help you monitor your campaign to ensure that you’re driving the best results. We’ll monitor significant metrics, like click-through rate and conversions. From this information, we’ll see how your campaign is performing and look for ways to improve it.

WebFX will help you lower your ad cost for Amazon

When you run an advertising campaign, you want to keep your CPC low, so you have more room to make a profit. By lowering your CPC, you’ll allow more clicks for your budget and obtain more leads. At WebFX, we have more than 25 years of experience lowering CPC for advertising campaigns.

We’re a full-service digital marketing company that specializes in PPC campaigns. With our team of over 500+ experts, we’ll bring our knowledge and expertise to your campaign. We’ll help you develop a CPC strategy that enables you to get more clicks for your budget.

If you’re looking for a company that drives results, look no further than WebFX. In the last five years, we’ve driven more than $3 billion in revenue and 7.8 million leads for our clients. Our team will create a campaign that helps your business grow.

Don’t believe us? Just ask our clients! Check out our 1020+ client testimonials that attest to the great work we do!

Get started today

If you’re ready to start lowering your CPC to earn more valuable leads for your business, contact us online or call us today at 888-601-5359 to speak with a strategist about how our ad agency for Amazon can help.

We look forward to helping your business grow!