What is Amazon Automatic Bidding? Ultimate Guide to Dynamic Bidding in Amazon Advertising [2023]

If you’re an Amazon seller looking to maximize your ad performance and revenue, you’ll want to get familiar with Amazon’s dynamic bidding. Automatic, or dynamic bidding can help you get the most out of your Amazon advertising campaigns by using Amazon’s dynamic bidding algorithms to automatically adjust your bids in real time to meet your performance goals. 

This guide is here to help you understand how Amazon automatic bidding works, what it is, and how to create your own bidding campaign.  

What are automated bids on Amazon? 

Technically, “Amazon automatic bidding” doesn’t exist, but this phrase is sometimes used to describe dynamic bidding on Amazon. 

So, what is dynamic bidding?

When using dynamic bidding, Amazon will automatically adjust your bid based on their assessment of the chance of conversions. With dynamic bidding, advertisers can choose between two strategies: “Down Only” and “Up and Down,” which we’ll go over later. ‘

What is automatic targeting in Amazon ads? 

There’s also automatic targeting, which is when Amazon sellers have Amazon decide when and where to show their advertisement. This is determined based on the keywords Amazon can detect from your product listing’s title, description, and other sections.

Automatic targeting vs manual targeting

Automatic targeting in Amazon ads is a feature allowing advertisers to reach potential customers without manually selecting specific keywords or target audience segments. With automatic targeting, Amazon’s algorithms analyze the product details and customer search terms to determine the most relevant keywords and target audience for the advertisement. 

This automated process helps advertisers save time and effort since the system automatically matches their ads to relevant customer searches and product listings. Sellers can reach a wider audience and boost their chances of increasing sales and conversions on the Amazon platform.

Alternatively, manual targeting allows sellers and advertisers to pick keywords and locations based on their research and advertising objectives. This method gives you additional personalization and control over your campaigns, but it takes more time and effort to put together and manage.

Dynamic Bidding Strategies

A dynamic Amazon bidding strategy is a great way to maximize efficiency and optimize ad spending while maximizing returns. By using dynamic bidding strategies, businesses can increase click-through rates and improve their overall ROI. 

Dynamic Bidding (Up and Down)

With Up and Down bidding, Amazon will raise your bid by a maximum of 100% if there’s a good chance of making a sale. It will reduce your bid if there’s not enough conversion.

Use “Up and Down” bidding when you want to: 

• Quickly increase sales 
• Maximize profits on a high-performing campaign
• Win ad placements for keywords at the top of the page

Dynamic Bidding (Down Only)

With Down Only bidding, sellers can set a desired cost-per-click (CPC) target and then Amazon’s algorithm will decrease–and only decrease–your bid for each keyword auction in real time. The algorithm will assess each auction’s optimal bid, relevance, ad quality, and competition.

With the “Down Only” feature, Amazon can reduce the bid if the ad is less likely to generate a click and conversion. This can help advertisers meet their target CPC while still getting conversions. 

Use “Down Only” bidding if you’re testing out ads, trying to cut costs, or looking to maximize profits.

How to Set Up Dynamic Bid PPC Campaigns

1. Optimize for ACoS: Advertising Cost of Sale

ACoS is a metric that shows the relationship between how much money you spend on advertising and how much revenue you make from those ads. It’s calculated by taking the amount of money spent on advertising and dividing it by the total sales revenue generated by that advertising.

You don’t want to spend more money than you earned regarding ad campaigns. You can reduce your ACoS by choosing the right keywords, optimizing your product titles and listings, and selecting the right bid amount. 

2. Understand RoAS

RoAS stands for return on ad spending and is used to measure the revenue from an advertising campaign. Advertisers compare this to the money they initially spent on creating the campaign and use the data to determine how effective the ad campaign is. 

Furthermore, the RoAS can show you what you “could ” make from an ad campaign.

3. Choose the Right Keywords

Choosing the right keywords is paramount when selling on Amazon–but not just for bids. Optimized Amazon keywords can not only rank your listing higher but also help with your ad campaign. 

It’s easier to find the best-performing keywords by performing keyword research. There are a few different ways you can conduct keyword research: 

• When conducting keyword research, you can experiment with keywords in the Amazon search bar and see what Amazon suggests.
• Check out what your competitors are doing and what keywords are helping them rank at the top of the search results. 

Or, you can use Sellesta.com! When you use Sellesta.com: 

• Access the integrated keyword generator feature in the listing optimization feature
• Get listing scores and direct insights about your listings’ titles, descriptions, reviews, and more
• AI-driven listing optimization that improves bullets, titles, and generic keywords

You can make your Amazon keyword research much more effective using Sellesta.ai and its comprehensive keyword tools.

4. Don’t Compare Results of Different Campaign Methods

One of the most common mistakes advertisers make is running both “Down Only” and “Up and Down” campaigns simultaneously. This can be a costly mistake since the two campaigns may end up bidding against each other in the same auction, resulting in higher costs and lower overall returns. 

You also can’t compare the results of different campaigns–especially old campaigns and new campaigns. Old campaigns will have more data so they’ll often end up looking more successful.

5. Use Amazon Ads Software

Using software to optimize your Amazon ads can help you create dynamic and targeted campaigns to increase profits. With the right software, you can generate campaigns customized to your business’s particular requirements and monitor and assess the results of your campaigns to guarantee they are as successful as possible.

Sellesta.com can help increase your visibility on Amazon and push your listings to the top of the SERP. With Sellesta you can: 

• Perform review and competitive analyses with our key tags to see what consumers think about you and your competitors’ products 
• Get AI listing optimization and generated copy for your product listings
• Get ideas for headlines, body copy, and more
• Generate multiple ads at once
• Get ahead of competitors by knowing all the trending keywords
• Track keywords daily 
• Make data-driven decisions with Sellesta insights

Boost your profits with Sellesta today! 

Benefits of Automated Dynamic Bidding in Amazon PPC Advertising

Automated dynamic bidding in Amazon PPC advertising provides many benefits, from improved conversion to giving Amazon sellers the control to set their own goals.

1. More Control

Automated bidding allows advertisers to customize bidding strategies to meet their desired objectives and set their own budgets. This control allows you to set goals and parameters tailored to your needs, such as desired ACoS, ensuring your budget is spent most effectively.

2. Improved Conversions

By taking advantage of automated bidding, advertisers can use the algorithm’s capability to adjust bids based on performance information in real time. This can result in increased campaign performance, more clicks, higher conversion rates, and a higher return on investment.

3. Flexibility

With the flexibility that comes with dynamic bidding, you can gain insight into what works best for your brand, allowing you to optimize other campaigns and maximize your revenue. Adjusting and testing your bids is essential to learning what works best for your brand. 

4. Ease of Use

Amazon takes care of most of the work when it comes to dynamic bidding, whether it’s down or up-down. All sellers and advertisers need to do is find the correct keyword and set your bidding target, and then Amazon will lower or raise your bid using its algorithm. 

Create High-Converting Amazon Advertising

Dynamic bidding is a great way to increase conversions and save money with Amazon. By automatically adjusting bids based on real-time data and performance metrics, advertisers can get their products in front of their target audience quickly and efficiently. This strategy allows businesses to stay competitive, increase visibility, and boost sales on the Amazon platform while achieving a higher return on investment.

Looking for support with your Amazon ads? Sellesta.com provides all the tools to rank high in the Amazon SERP, Stay ahead of your competitors, and create awesome Amazon SEO-driven product listings. Our AI can help you generate copy, discover high-ranking keywords, and provide you with insights to make the best marketing decisions to drive sales and improve your ad ROI. 

Optimize your Amazon marketing strategy with Sellesta today.