
Amazon 1P vs. 3P is like the difference between selling a car via a dealership or as a private seller—there are pros and cons to each. It depends on what you want to achieve.

Most businesses start as third-party sellers (3P) on Amazon’s marketplace. Nearly [59%](https://www.statista.com/statistics/259782/third-party-seller-share-of-amazon-platform/) of Amazon sales came from this group in Q2 2022. So what are the main differences between 1P and 3P?

Read this quick [Merch Jar](https://merchjar.com/) guide to get all the answers you need.


## Amazon 1P Vs. Amazon 3P: Overview

Amazon allows you to opt for either a first-party relationship (1P) or a third-party relationship (3P) if you want to be an online trader. With 1P, you’re a wholesaler who supplies Amazon directly. The store then manages all the logistics.

On the other hand, an Amazon 3P is an independent seller on its marketplace. You have control over your e-commerce store brand and are responsible for logistics. Also, 3P can help you differentiate your products from those of your competitors.

Each business method has its strengths and weaknesses.

And if you deal with large volumes of multiple products, you must have an arsenal that can triple your sales. Thanks to Merch Jar’s Promotions, which is a powerful feature to improve your revenue and drive down your [Amazon ACoS](https://merchjar.com/blog/how-to-track-amazon-acos-plus-best-practices) (advertising cost of sales). [See how the tool works.](https://merchjar.com/features/smart-bids)



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Here are more details about 1P and 3P so you can make the best decision for your brand.


## What Is Amazon 1P?

As already mentioned, a 1P relationship means Amazon sells products on your behalf. You supply the online store as a wholesale supplier through Vendor Control. And Amazon handles the rest.

But there’s a catch.

You can only become a 1P seller when Amazon sends you an invitation to participate in this program. Once you accept the invitation, the store sends you a purchase order (PO). You must complete it and ship the requested products back to Amazon.


### Example:



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This product says “ships from Amazon” and “sold by Amazon,” indicating that it’s supplied by a 1P seller.


### Pros:

- Harness Amazon’s well-established reputation, saving yourself from brand-building campaigns
- Access comprehensive product listings
- Use advertising tools for Amazon vendors
- Enjoy two-day and Prime shipping
- Use advertising tools for Amazon vendors
- No need to worry about tax issues, SEO, listing optimization, etc.
- Pay only a flat fee


### Cons:

- You can’t control product pricing, and Amazon can sell below Minimum Advertising Price (MAP)
- Low-profit margins
- Irregular payouts compared to a 3P seller
- You can’t control inventory availability on Amazon
- You can lose your status as a 1P seller at any time


## What Is Amazon 3P?

An Amazon 3P is a trader who sells products directly to customers on the online store’s marketplace via Seller Central. You must list your items on Amazon and arrange shipping logistics through [FBA](https://sell.amazon.com/fulfillment-by-amazon) or [fulfillment-by-merchant](https://sell.amazon.com/learn/fulfillment-by-merchant) (FBM).

Amazon provides you with the following features:

- Website
- Payment processing
- Customer service support

But you’re responsible for:

- Managing inventory
- Setting prices
- Optimizing listings
- [Amazon ad management](https://merchjar.com/blog/the-ultimate-guide-to-amazon-ad-management)
- And more


### Example:



<Image
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This item says it's sold by “Chubbiestech,” showing that it’s supplied by an Amazon 3P seller who uses FBA for logistics.


### Pros:

- 3P gives you total control over pricing, advertising, and marketing
- You have brand control to promote your identity
- You have the freedom to run promotions, edit listings, and product detail pages. No need to get approval from Amazon to do this


### Cons:

- Responsible for product quality
- You're in charge of list optimization and running marketing campaigns
- Need to operate at a large scale to use the Seller Central
- Incurs additional expenses, like fulfillment, referral, and closing costs
- You must address customer complaints and queries yourself, or Amazon can suspend you if you fail to resolve the issues


## Key Differences Between Amazon 1P and Amazon 3P

Knowing the major differences between Amazon 1 P and 3 P helps you decide the ideal business approach that meets your goals.

The number one difference between 1P and 3P boils down to **control**. Want to sell products directly to customers via the Amazon marketplace? You can do this through Seller Central to manage your business as an Amazon 3P seller.

On the other hand, apply to be an Amazon 1P vendor (wholesaler) if you want to sell directly to Amazon through the retailer’s Vendor Central. Make sense?

So let’s explore the differences in-depth below.


### Brand Control



<Image
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[Source](https://www.linkedin.com/posts/steven-pope_difference-between-vendor-central-1p-and-activity-7006588583948017664-YVRl?originalSubdomain=cm)

Look at the image closely. You can see that an Amazon 1P vendor sells directly to Amazon via Vendor Central. The e-commerce store then sells your products to buyers. And your primary role is ensuring you satisfy purchase orders (PO) that you receive from Amazon.

Amazon is responsible for shipping the products to customers. But you can’t control the following issues:

- Product presentation
- Listing updates

However, a third-party (3P) seller sells directly to buyers on Amazon’s marketplace through Seller Central. It means you’re responsible for the following marketing activities:

- Using the right [advertising tools and PPC software](https://merchjar.com/blog/top-amazon-advertising-tool-and-amazon-ppc-software) for your ads
- Creating product listings
- Updating your stock
- Shipping (You can choose FBA to handle all logistics)


### Time vs. money

Selling through Amazon 3P requires more time and effort, such as creating product listings, tracking stock, and handling shipping.

But it can also significantly increase profits because you have total control over pricing and marketing.

On the other hand, selling directly to Amazon (1P) needs fewer resources and is faster. However, it can reduce profits due to paying for shipping and other fees. Plus, you can’t tweak your marketing to increase sales since Amazon controls your products.


### Diversification

While 1P sellers can diversify their clientele by selling in other marketplaces, they risk delisting if one shop supplies goods at lower prices than another. So there are some restrictions when it comes to exploring other e-commerce channels to grow your business.

For these reasons, the opportunities to make more money become slimmer.

With 3P sellers, it’s possible to sell your products on other marketplaces, like eBay for instance, etc. There’s no risk of delisting and no limit to the number of e-commerce platforms you can deal with. In this way, you can double your sales.


## Ensure Your Business Succeeds on Amazon with Merch Jar!

It’s advisable to apply as a 3P seller if you want 100% control. But if you want Amazon to handle everything for you and are a wholesaler, take the 1P route. Some businesses blend 1P and 3P to take advantage of the two business models.

Whether you choose to become an Amazon 1P or 3P seller, you must have a [winning Amazon bidding strategy](https://merchjar.com/blog/how-to-develop-a-winning-amazon-bidding-strategy-plus-tactics) to optimize your ads. [Merch Jar](https://help.merchjar.com/blog/navigating-merch-jar) is advertising software that lets you grow your Amazon business.



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You can save a lot of time managing your ads and focus on growing your business. Use the analytics dashboard to see your entire ad catalog at a glance.

Say goodbye to Amazon's built-in advertising dashboard. It limits you to only the previous 65 days of data, making it difficult to track YoY and longer-term trends. [Create a free account to get started with Merch Jar](https://app.merchjar.com/register).


amazon-1p-vs-3p


Amazon ads for books allow you to target potential readers precisely by genre, audience, and even budget. With the right targeting, you can reach a much larger audience with your ads, leading to increased book sales and more recognition for your work.

Discover actionable tactics on how to harness the power of Amazon book ads in this [Merch Jar](https://merchjar.com/) guide.


## What Is Amazon KDP Advertising?

Kindle Direct Publishing(KDP) is Amazon’s great platform that lets you self-publish, paperbacks, eBooks, and hardcover books for free.

Amazon KDP advertising is a marketing campaign that lets publishers and authors promote their books or ebooks through paid ads on Amazon. The advertised book appears on the following platforms:

- Kindle Store
- ebook detail pages
- Amazon.com/Amazon search results
- Kindle devices and tablets, specifically on the lock screen
- Other marketing channels which are part of the Amazon network

Amazon ads for books can cover KDP-published books, books published outside of KDP, and co-authored books. Note that ads for KDP titles are available in the US, UK, Canada, Germany, Australia, Spain, Italy, and France.

Also, KDP advertising is based on cost-per-click (CPC), meaning you only pay when buyers click on your ads. And the book you have advertised has the tag “Sponsored” on Amazon's search results.

**Example:**



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## What Are the Types of Amazon KDP Ads?

KDP advertising offers you three options to promote your books before you create a campaign. Let’s dive into each one in detail.



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### 1. Sponsored Product Ads

With Sponsored Products, you can promote your book on Amazon so it appears in the search results and on the product detail pages. When a potential customer clicks on the ad, it takes them to the book’s detail pages.

**Example:** "Economic Books" search shows the top titles plus a row of sponsored ads.



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You can take advantage of Sponsored Product Ads to enhance your book’s visibility and drive sales. Also, they can enable you to use product target ads where you select a particular category, book series, or book to target. Such Amazon ads for books will appear as shown below:



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To ace your Sponsored Product ads, you must bid on the right keywords. It ensures your book ad appears in search results.


### 2. Sponsored Brand ads

Want to create a robust brand around your personality or books? Harness the power of Sponsored Brand ads. They show up as a banner on the top, left, and underside of the search results page.

You can use these ads to drive traffic to your book’s landing page or Amazon store. Have a look at the example below that shows Jenna Hendricks’s store.



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Also, Sponsored Brand ads can leverage product targeting. These ads appear as a tiny box near the carousel on the listing page.



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### 3. Custom Advertising

Custom ads allow authors or publishers to have more control over their ad placements and target specific audiences. This lets you create more targeted campaigns tailored to your audience’s needs.

Also, custom advertising helps you gain insights into your customers' habits and tastes. This feedback can help you optimize your book ad campaigns for maximum efficiency.


### 4. Lock Screen Ads

With Lock Screen Ads, you can advertise your books with targeted ads on Kindle devices, including Fire tablets. They can show up on the Fire tablets and E-reader’s home page or the wake screen.

These ads can grab customers’ attention and take them to the eBook detail page when they click them.



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[Source:](https://advertising.amazon.com/library/guides/lockscreen-ads)


## How to Implement Amazon Ads for Books

Amazon Ads uses algorithms to target potential readers for your book based on the book's genre and keywords you have chosen. This means you’re targeting readers already interested in books like yours, increasing your sales opportunities.

Follow the steps below to kickstart your KDP advertising campaign.


### Step 1: Access KDP Ads Campaigns

To promote a book, log into your Amazon KDP account. Choose _Promote and Advertise_ from the relevant section on your bookshelf.



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Pay attention to the section titled _“Run an Ad Campaign_.”

- From the dropdown menu, select the Amazon marketplace where you want to run the ads.
- Click _"Create an Ad Campaign_" to begin.



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### Step 2: Select a Campaign Type and Ad Format

As previously stated, Amazon ads for books give you three campaign options: Sponsored Products, Sponsored Brands, and Lockscreen Ads. It’s advisable to start with Sponsored Products since you can easily create them, and they can instantly appear in related shopping results and product pages.



<Image
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Also, don’t forget to select your ad format. We prefer the custom ad format, as you can describe your book in the exact way you want, providing extra detail that can convince users to give your book a try.


### Step 3: Select a Book to Promote

Decide which book you want to promote with Sponsored Products.



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While you choose the book you want to advertise to your potential readers, it’s vital to have the correct targeting strategy. This can make or break your audience's reach.

You have the following two choices:

- **Automatic Target:** Amazon determines when and how to display your advertisement
- **Manual Targeting**: (Advanced) It lets you show your book ads to people who enter particular keywords into Amazon’s search bar. Or readers who browse a specific book title or category

Automatic targeting is a better option if you’re a newbie to Amazon ads for books. It allows you to learn the ins and outs of KDP advertising and manage manual targeting at a later stage. That being said, once you’re used to advertising on Amazon, give manual targeting a try! You’ll be able to get your book in front of users who are most likely to be interested in what you’re offering.



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### Step 4: Set a Default Bid and a Campaign Bidding Strategy

Next, determine your campaign bidding strategy. How much do you want to pay Amazon per click (CPC)? Again, Amazon offers you three ways to decide how you want to bid: Dynamic bids-down only, Dynamic bids-up and down, and Fixed bids.

Dynamic bidding enables Amazon to automatically change your bids in real-time when there's a chance that a click can convert into a sale. It lets you improve your conversion rate and stay within your budget.

However, Dynamic bids - up and down can increase your campaign expenses. And if you want to have total control of your advertising costs, select Fixed Bids.



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Need a [winning Amazon bidding strategy](https://merchjar.com/blog/how-to-develop-a-winning-amazon-bidding-strategy-plus-tactics) to get a good ROI on your ads? Let Merch Jar handle your Amazon ads for books. Set your bid and forget it!

MerchJar’s Smart Bids algorithm automates finding the perfect bid to reach your ACoS goals, so you can sit back and relax. [Have a quick look at how it works](https://help.merchjar.com/blog/navigating-merch-jar).



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### Step 5: Set Up Campaign Duration, Budget, and Billing Info

For the last step, select your overall campaign’s name and the start and stop dates from the drop-down calendar. Set your budget, but remember to consider your average cost of sales (ACoS). Learn more about how to determine [ACoS](https://merchjar.com/acos-to-roas-calculator) with an online calculator.



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Enter your valid credit card information with Amazon by clicking the blue link “Billing and Payments” at the top of the screen.


##

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That’s it. You have created your first Amazon book ad campaign. Congrats!



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[Source](https://myebook.online/amazon-kdp-advertising/):


## Best Practices to Get Started with Amazon Book Ads


### 1. Use Amazon seller tools

Leverage Amazon [advertising tools and PPC software](https://merchjar.com/blog/top-amazon-advertising-tool-and-amazon-ppc-software) to enable you to manage your KDP advertising effortlessly.

Managing advertising campaigns on the platform can be time-consuming and overwhelming. With [Merch Jar software](https://merchjar.com/features/recipes), you can manage and automate your ad campaigns easily, so you can focus on what you do best - growing your publishing business.



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### 2. Use keyword targeting

A keyword is any search term a potential buyer enters in Amazon’s search bar. For instance, someone might search for “thriller” books. Use as many keywords as possible—even 1,000 search terms or keyword phrases. However, we suggest using a minimum of 35 keywords to be more effective.

Keyword targeting helps you improve your click-through rate (CTR) and return on ad spend (ROAS).



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There’s a better method of performing keyword targeting. Merch Jar’s [Promotions feature](https://merchjar.com/features/promotions) lets you set up keyword graduation. It allows you to identify which keywords are high-performing and which are not, allowing you to adjust bids and ad copy accordingly to maximize your ad campaign’s effectiveness



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### 3. Understand ACoS

ACoS (advertising cost of sales) is how much you spend for every dollar of revenue you make. You get it by calculating the total ad spend divided by your total sales. The lower your ACOS, the better. And Merch Jar makes it a breeze to manage ACoS.

You can automatically:

- increase keyword bids when ACoS is low
- lower target bids when ACoS is high


- increase keyword bids when impressions are low
- pause ads when unprofitable



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## It’s Time to Level Up Your Amazon Ads for Books with Merch Jar!

KDP advertising is a great way to promote your books across Amazon’s multiple channels. You must have a winning ad campaign strategy to reap profits and a high ROAS.

<Image
  src="/images/blog/amazon-ads-for-books-kdp/23.png"
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/>

Merch Jar helps you optimize your KDP advertising on Amazon. Generate more book sales and reviews, reclaim wasted ad spend, and spend less time optimizing your ads. Make smarter optimizations and reduce your ACoS with Merch Jar today. [Sign up for free to get started!](https://app.merchjar.com/register)


amazon-ads-for-books-kdp


Because you don’t have to wait long to get your products shipped from the supplier, retail arbitrage lets you sell and generate income quickly. In fact, [19% ](https://influencermarketinghub.com/amazon-retail-arbitrage/#:~:text=Retail%20arbitrage%20sellers%20are%20crucial,arbitrage%20as%20a%20business%20model.)of Amazon sellers use retail arbitrage as their preferred business strategy. But the million-dollar question is: Is Amazon retail arbitrage worth it? [Merch Jar](https://merchjar.com/) dives into this exciting question to help you decide whether this approach deserves your attention. Let’s get started!


## **Amazon Retail Arbitrage: Overview**


Retail arbitrage is buying discounted products from various retailers and online suppliers and reselling them on the Amazon marketplace. For example, you might purchase a product from Walmart for $10 and resell it on Amazon for $17, making a $7 net profit before fees and shipping costs. The business model is popular with many traders and [Merch by Amazon](https://merchjar.com/blog/merch-by-amazon-mba-insider-best-practices-you-must-know-about) (MBA) sellers because it’s a low-cost investment. You can start with as little as $100 or $200; there’s no steep learning curve to launch your business. But there’s a catch.Patience is the name of the game, as it can take at least six months to make some profit.


## **Why Amazon Retail Arbitrage is Worth It**


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Wondering whether retail arbitrage is worth your time, effort, and money? For starters, the Amazon marketplace is a humongous platform of third-party online sellers (_about_ [_6 million sellers_](https://www.marketplacepulse.com/amazon/number-of-sellers) _globally and 1.5 million active sellers in 2021_). That’s a sea of competition. But there’s some good news!You can navigate the _Wild West_ of the Amazon marketplace by trying retail arbitrage. So let’s explore whether it’s worth your investment.


### **Low-risk**


One universal truth that applies to all businesses is that every business idea has some level of risk. You don’t have a crystal ball to know exactly how things will pan out. But some business ventures have low risks, and Amazon retail arbitrage is one of them. The beauty of this concept is that you can buy one discounted item from eBay, Alibaba, etc., and resell it on the Amazon marketplace. So you don’t have to start with bulk purchases if you’re a new seller or incur the high costs of owning a physical store. Both of which require a substantial amount of start-up capital. Also, retail arbitrage on a small scale allows you to learn how the biggest online marketplace in the world works. And that’s well worth your effort.


### **Quick profits**


Want to make quick profits? Buying and reselling products on the Amazon marketplace can let you achieve that. You only need to understand what your target group wants and select the right products you can sell.Although retail arbitrage margins are tight, fast-moving inventory in huge volumes can enable you to make money within a short time. You can still make some reasonable profits even after meeting your fulfillment expenses.


### **Low competition**


What’s the success rate for [Fulfillment by Amazon](https://sell.amazon.com/fulfillment-by-amazon) (FBA)? 25% of Amazon sellers. In addition, only [20%](https://beprofit.co/a/community/business/what-is-the-success-rate-for-amazon-fba#:~:text=How%20easy%20was%20it%20for%20you%20to%20start%3F&text=Amazon's%20FBA%20success%20rate%20is,in%20their%20entire%20FBA%20career.) of businesses generate at least $1000 in profits in their whole FBA selling career. You can see it’s not a stroll in the park to succeed on the Amazon marketplace. But it means many sellers are more likely to give up if they make continuous losses. And those who persist with Amazon retail arbitrage can realize profits in the long term.


### **Low-cost**


<Image
  src="/images/blog/is-amazon-retail-arbitrage-worth-it/2.png"
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  width={594}
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[Source](https://sell.amazon.com/pricing)

In a nutshell, retail arbitrage is a cost-effective investment for anyone who wants to start trading. The above screenshot shows that you must pay $0.99 for every item you sell on the online store, which is affordable.Furthermore, you only need the following to get started with the Amazon e-commerce platform:- Find relevant products to sell
- Create an Amazon seller account
- Decide whether to use [Fulfillment by Merchant](https://sell.amazon.com/learn/fulfillment-by-merchant) (FBM) or Fulfillment by Amazon (FBA) to manage packing, shipping, and customer service
- Only sell 40 products if you’re an individual seller
- Open a professional account to sell more than the limit. You’ll pay [$39.99 per month](https://sell.amazon.com/sell#:~:text=With%20the%20Individual%20plan%2C%20you,and%20varies%20by%20product%20category.)
- List products and start selling


## **Why Amazon Retail Arbitrage is NOT Worth It**


While retail arbitrage appears to be low-hanging fruit, it has a downside. Let’s look at a few of its challenges:


### **Ads can be costly**


[Ad Badger](https://www.adbadger.com/blog/amazon-advertising-stats/) reports that US Amazon online sellers paid $0.71 on average for every click on their ad in 2020. And the cost per click (CPC) has been skyrocketing since the pandemic, hitting $0.89 for every click. Advertising costs on the Amazon marketplace vary depending on several factors. Some of them include the following:- Type of Amazon ads
- Your budget
- How you target your ads
- The specific ads you make
- Your nicheIt’s crystal clear that if you don’t make reasonable profits, your return on ad spend (ROAS) can be low. Also, Amazon’s fulfillment fees have been ballooning, as per a [Statista report. ](https://www.statista.com/topics/8024/third-party-3p-selling-on-amazon/#topicOverview)

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### _Check out this guide on_ [_how to track Amazon ACOS_ ](https://merchjar.com/blog/how-to-track-amazon-acos-plus-best-practices)


### **Lower profit margins**


When it comes to profit margins, it’s not a pretty picture. Recent stats indicate that 62% of sellers involved in retail arbitrage made nearly $5,000 per month. And 25% of them earned less than $500 a month (_via Influencermarketinghub.com)._The same report says it takes about six months to realize profits with this business approach. Amazon retail arbitrage needs a ton of patience, persistence, and a[ winning Amazon bidding strategy](https://merchjar.com/blog/how-to-develop-a-winning-amazon-bidding-strategy-plus-tactics).Profit margins can also fall if you don’t source your products directly from manufacturers and suppliers.


### **Customer Complaints**


Amazon retail arbitrage can compromise product quality. It’s possible to buy items with damaged packaging, mismatched product descriptions, etc. Shoddy products or poor customer service can turn many buyers away.


### **Inconsistent inventory**


The success of retail arbitrage hinges on getting discounted products so you can have a meaningful markup. You buy anything that can give you good profits. So there’s no consistency when it comes to inventory. Anything goes.


### **Low sales on the Amazon Marketplace**


According to the [Office for National Statistics](https://www.ons.gov.uk/businessindustryandtrade/retailindustry/articles/howourspendinghaschangedsincetheendofcoronaviruscovid19restrictions/2022-07-11) in the UK, shopping online has been gradually falling since the easing of COVID-19 restrictions. Consumers are slowly returning to physical stores.Elsewhere in the US, the trend is the same as shoppers are rushing back to stores. Because of these latest developments, Amazon retail arbitrage is likely to suffer from low sales.And Amazon is also feeling the heat, as shown by the large number of [employees](https://www.cnbc.com/video/2022/11/14/amazon-announces-10000-layoffs.html) laid off.


## **The Verdict**


**Is Amazon retail arbitrage worth it**? Yes, it’s worth it. It’s a great business model for newbies with a small amount of capital who want to learn the tricks of the trade. Also, you don’t have to go through a lengthy course to start selling on the online platform.However, retail arbitrage has its share of problems. They include the following:- Increased competition means low profits
- Challenging to find winning products
- Oversaturation of products
- Expensive ads
- Skyrocketing feesDespite these setbacks, buying and selling products online will always be possible. You can find people who love the convenience of shopping at e-commerce stores like Amazon. So Amazon retail arbitrage is here to stay.Want to scale up your retail arbitrage business with optimized ads? Let [Merch Jar](https://help.merchjar.com/blog/navigating-merch-jar) grow your sales through Amazon ads.

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The platform has three powerful tools to take your Amazon retail arbitrage business to another level. - You can use the Recipes feature to precisely and automatically optimize your ads
- Use the **Promotions** tool to promote high-performing keywords to improve your ad bid
- Take advantage of the **Bulk Actions** feature. Bypass the 1,000 product limitation in Amazon's bulk sheets to increase budgets campaigns or double bids of high-converting keywords. [Sign up ](https://app.merchjar.com/register)for free to get started with Merch Jar!


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Amazon FBA and dropshipping are game-changers for the e-commerce market because they allow startups to effectively scale their businesses. FBA is currently the most popular fulfillment method, as approximately [89% of Amazon sellers](https://www.junglescout.com/amazon-seller-report/) use it. However, this doesn’t make it the best approach for every business.

So which order fulfillment method works best for your Amazon business? In this [MerchJar](https://merchjar.com/) article, we’ll go over the unique differences between Amazon FBA and dropshipping so you can make the most informed decision. 

Ready? Let’s dive in!


## What is Amazon FBA? 

Amazon FBA (Fulfillment by Amazon)  is a reliable service that Amazon offers to help third-party sellers with storage, automating their order fulfillment, product shipping, order returns, and customer service. 



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This is how FBA works: 

1. Online sellers with an FBA private label send their product inventory to their nearest Amazon fulfillment centers
2. Amazon receives the products, sorts them, and stores them in the fulfillment centers
3. Customers order the seller’s products from the Amazon marketplace
4. As soon as the order is confirmed, Amazon FBA packs and ships the product to the customer
5. Amazon FBA handles all customer service, including if customers want to return a product and get a refund
6. Your revenue goes straight into your account after a period of 2 weeks
7. Amazon will notify you when your product stock is running low so you can replenish it in good time

Essentially, when you pay for Amazon FBA, all you have to do is send your stock and collect the revenue from your orders. 


### Pros & Cons of Amazon FBA


#### Pros

- **Gain customer trust**: When Amazon ships your products, your listings automatically receive the Prime shipping badge. This helps customers trust your products more because they know Amazon Prime shipping is reliable and fast. 
- **Lower operating costs**: There’s no need to worry about organizing storage, hiring staff, or logistics management because Amazon FBA covers everything. 
- **Strengthen your Amazon ranking**: For Amazon sellers, if you use the FBA program, your product shows higher up on product search pages. 


#### Cons 

- **High fees**: Depending on the size and weight of your products, Amazon FBA fees can be quite costly. Additionally, sellers also need to pay monthly storage fees, and this can become quite burdensome if your stock isn’t moving as fast. 
- **Limits on restocking**: Sometimes, you may not be able to send in as much stock as you would like because Amazon puts restock limits per storage type. 
- **Increase in returns**: Amazon has a no-questions-asked return policy, which can encourage customers to return products more frequently. 


## What is Dropshipping?

Dropshipping is an order fulfillment method where the online seller doesn’t keep the products they sell in stock. Essentially, the seller will list the products online, and once an order is made, they will have it shipped from the supplier without having to purchase any stock themselves. 



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[Image source](https://www.salehoo.com/blog/benefits-of-free-amazon-shipping-for-dropshippers)

The dropshipping model is quite easy for any e-commerce seller to get started with because there’s no major upfront investment. It’s important to point out though, that Amazon does have a strict [dropship policy](https://sellercentral.amazon.com/ap/signin?openid.pape.max_auth_age=0&openid.return_to=https%3A%2F%2Fsellercentral.amazon.com%2Fhelp%2Fhub%2Freference%2F201808410&openid.identity=http%3A%2F%2Fspecs.openid.net%2Fauth%2F2.0%2Fidentifier_select&openid.assoc_handle=sc_na_amazon_v2&openid.mode=checkid_setup&language=en_US&openid.claimed_id=http%3A%2F%2Fspecs.openid.net%2Fauth%2F2.0%2Fidentifier_select&pageId=sc_na_amazon_v2&openid.ns=http%3A%2F%2Fspecs.openid.net%2Fauth%2F2.0&ssoResponse=eyJ6aXAiOiJERUYiLCJlbmMiOiJBMjU2R0NNIiwiYWxnIjoiQTI1NktXIn0.updcaUiah2SZtLsn3IdHmYqZ-EsB6QN2njp30ODCtYjnz0Brc-8SUA.Q1m2BZTaTolBSqTo.HFuoZX9F5kHww74BgHcTG78_sFwahIneXZlQRYrIGr7cHt9eK5gJvt-MNIya_a8R0X-Et1yPf6C4nBpHtGK13U2unbV2he4aYoONHCQmDqMRnjYsTIYyH8Y8iULEtAo6X2F7reuHYYwS0n-Xwr1k8fWtcJi8lJ7XDt72a2PgYkMGx-B0npdk-RVLBw5ctM6RR8anAYuTw01Ny5vMI2_XMYxpOk3VV-CYoSVMSIbjTBtVmT4h2t-uCXuJ1Qt_zw.tXNRV54GwacfWell42ymGA). For example, sellers aren’t allowed to dropship products from other retailers, like Walmart. Additionally, even though sellers aren’t directly responsible for the shipping and handling of products, they need to stay responsible for accepting and processing returns.

**Pros & Cons of Dropshipping**

Pros

- **Easy to get started**: Dropshipping generally has low barriers to entry because you can simply find your products from a supplier and immediately start listing them on Amazon. 
- **Low costs**: The startup costs are quite low because you don’t have to worry about ordering inventory or spending on storage. 
- **Unlimited product options**: Since you won’t have to worry about acquiring stock, you have the freedom to list a very wide variety of products for your business. 

Cons

- **More competition**: Since dropshipping is so easy to start, you’ll find more competition.
- **Inadequate quality control**: As you don’t have access to the products yourself, you can’t guarantee the quality will be of a high standard.
- **Slow delivery times**: Depending on the manufacturer or supplier you choose, you are at a higher risk of facing slow delivery times. This might make it difficult to compete with products with the Amazon Prime badge.


## Key Differences Between Amazon FBA & Dropshipping 

1. ### Scalability

**Amazon FBA:** Since Amazon handles so much of the logistical process, you’ll have a lot more time to focus on elevating the quality of your products, marketing, and scaling your business. Although getting started with the Amazon Fulfillment network can take a bit more time, FBA offers you a larger customer base to sell to so you can generate consistent sales. Reliable and fast shipping can also help generate positive reviews that bring more customers to your storefront. 

**Dropshipping:** While scaling with dropshipping is possible, it can take a lot more effort on your part to build strong business relationships with your suppliers. You may have to experiment with different suppliers, in the beginning, to figure out which ones can help you deliver optimum products and services for your customers.  

2. ### Customization

**Amazon FBA:** Since you’re selling directly from Amazon, you won’t have many customization options. FBA sellers all have to stick to the standard Amazon sales page listing. 

**Dropshipping:** When you’re using a dropshipping method with your own online store, you have more freedom when it comes to customizing your listing page. You’ll be able to personalize the look and feel of your website and add creative product images that reflect your brand image. Additionally, if you also choose to have an Amazon storefront, you’ll be able to direct your customers to it from your online store’s main website.

3. ### Investment

**Amazon FBA:** To use Amazon FBA, you need to have investment capital, and you’re looking at a minimum of about $5,000. For such a reliable service, you’ll have to consider the cost of sourcing your stock, [fulfillment fees](https://sell.amazon.com/pricing#other-costs) (e.g., picking up and packing orders, shipping and handling, product returns, and customer service), storage fees, and long-term storage fees. 

**Dropshipping:** A major benefit of dropshipping is that you can start a store with little to no budget. Your supplier will be the one to handle the stock, storage, and shipping of your products, saving you a ton of logistical costs. 

4. ### Risk

**Amazon FBA:** Although FBA has higher growth potential, the risk is also much higher because you need to pay upfront for the inventory you send to Amazon. You’ll have to consider incurring losses for products that you can’t sell on time because of shifting market demand. Additionally, it can be more difficult to secure repeat customers through email lists since customers belong to Amazon and not you. 

**Dropshipping:** You face a much lower risk because you don’t have to invest capital or acquire the stock yourself. With dropshipping, you’ll only buy the products that have actually been ordered by your customers. 


## Amazon FBA vs. Dropshipping: Our Verdict

Ultimately, dropshipping is a risk-free alternative to Amazon FBA. Especially if you don’t have enough capital to invest in FBA. While risk-free, it can be difficult to compete with Amazon Prime products, as they’re generally seen as more trustworthy products. Additionally, customers can expect their orders much quicker and more reliably, as most Prime products are delivered the next day. With dropshipping, you essentially have to rely on your supplier to fulfill your orders, and it can be difficult to manage logistically if you’re not careful. 

Furthermore, with Amazon FBA, you can provide your customers with elite customer service and offer them attractive deals such as free shipping if they are Amazon Prime members. Dropshipping, unfortunately, doesn’t offer you such luxuries. You can also find that your profit margins are smaller with dropshipping because your product prices are led by your supplier, and you’re not purchasing in bulk. 

To know which fulfillment method is perfect for you, consider your business model. If you’re just starting up in e-commerce, dropshipping is a great place to start because it’s low-risk. Once you establish your business and gain enough revenue, it’s well worth investing in Amazon FBA to help you scale.  


## Elevate Your Amazon Advertising With MerchJar

Whichever fulfillment method you choose for your business, you’ll greatly benefit from using an [Amazon ads management tool](https://merchjar.com/blog/top-amazon-advertising-tool-and-amazon-ppc-software) to help you reach your target customers. [MerchJar](https://merchjar.com/) is dedicated to reducing the time and energy you put into managing your Amazon ad campaigns by automating your targeting efforts and [analyzing your ad performance](https://merchjar.com/features/recipes). This way, you can spend more time focusing on scaling your business. 

Want to see how it works? Try our [30-day free trial](https://app.merchjar.com/register) today! 


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If you’re selling on Amazon, chances are you use multiple channels to advertise your products and store. If so, you’ll understand that consolidating your customer data across all channels can be a time-consuming process. Amazon Attribution is a solution to this problem. It allows sellers to understand what’s driving engagement outside of the platform. 

Couple Amazon Attribution with an Amazon advertising software like [Merch Jar](https://merchjar.com/) for a complete picture of the impact of your marketing strategies. Merch Jar adjusts your Amazon ad bids automatically based on the parameters you set. And, it automatically pauses poor performing ads when they go below your set threshold. 

With that in mind, let’s have a look at the ins and outs of Amazon Attribution and how to effectively use the service to optimize your marketing campaigns. 


## What is Amazon Attribution?

When it comes to selling on Amazon, [Amazon ad management](https://merchjar.com/blog/the-ultimate-guide-to-amazon-ad-management) is different to managing ads from other channels, like social media. You need a way to connect your off-Amazon ads with your Amazon seller channel. Amazon Attribution is that solution. 

Amazon Attribution is a service that Amazon has made available to certain Amazon sellers. Using tags, it allows you to track touch points in an Amazon buyers (or potential buyer’s) journey across marketing channels outside of Amazon, such as Facebook and Google Search. 

It works by a seller creating a tag for their Amazon product, which is a unique link that sellers can use in their various marketing methods like social media posts, marketing emails, and Google Ads. The Amazon Attribution software then gathers data so sellers can see how effective (or ineffective) each marketing method is at converting customers. 

The analytics gather data like impressions, clicks, page views, and add-to-carts. With this information, sellers can learn what kind of content resonates with their buyers and drives the best results. 



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## Why is Amazon Attribution Worth Considering?

Amazon Attribution allows sellers to refine and optimize their marketing campaigns and [track their ACOS](https://merchjar.com/blog/how-to-track-amazon-acos-plus-best-practices). But there’s more. Here are three reasons why Amazon Attribution is worth considering:

- **Reach the right audience:** Amazon Attribution is essential for reaching the right audience. For example, if one of your products gets a lot of clicks but no purchases, your ad content might be targeting the wrong audience. In this case, you’ll need to compare these with analytics from your successful marketing content to understand what works for your audience and what doesn’t. 
- **Partial fee rebates:** When you sign up to Amazon Attribution, you can get access to Amazon’s Brand Referral Bonus program. Sellers who enrol on this program receive partial rebates of their seller fees when they make sales through the Attribution links.
- **It’s free:** Amazon Attribution is completely free. Aside from providing detailed insights into your customer's journey, this is one of the most compelling reasons to work with Amazon Attribution.   


## How to Use Amazon Attribution

Amazon Attribution should be used as part of a wider marketing strategy. While it’s true that analytics outside the Amazon platform provide valuable information on where your customers are coming from and what kind of content entices clicks, you also need to consider your in-Amazon marketing tactics. 

Merch Jar is a comprehensive solution that helps users make the most of their Amazon ad budget. It helps sellers build [winning Amazon bidding strategies](https://merchjar.com/blog/how-to-develop-a-winning-amazon-bidding-strategy-plus-tactics) by facilitating keyword and bid automation. With this, sellers can target the right keywords consistently, saving them hours of time to focus on other areas of their business.



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Our Bulk Actions feature also enables sellers to run ad operations for hundreds of thousands of products simultaneously. So if you’ve got a large product catalogue, you can bypass Amazon Bulksheet’s 1000 product limit. 

Now let’s get into how to use Amazon Attribution effectively:


### Eligibility Check

Your first step in using Amazon Attribution is to check you’re eligible. Currently, it’s available in select countries only. These are:

- U.S.
- Canada
- Mexico
- Germany
- Spain
- France
- Italy
- The Netherlands
- Portugal
- UK
- Egypt

You can access Amazon Attribution if you’re a professional seller in one of the above countries and are:

- Enrolled in Amazon Brand Registry
- A vendor
- A KDP author
- An agency whose clients sell on Amazon


### Create an Attribution Tag

After you’ve signed up to Amazon Attribution and set up your account, you need to create your tags. These will enable you to track your marketing efforts outside of Amazon. 

- Select the advertiser’s name you wish to create the tag for.



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- Click on “New Order”.



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- Now, you can generate a link for your marketing campaigns. For a link for a Google Ad, you must ‘Upload a file’ and then follow the steps you’re given to complete the process. 

For links for other marketing channels, like Facebook, select ‘Set up an order’.

You’ll be greeted with a list of your products. Select the one you want to generate a link for by clicking on the ‘Add’ button next to the product.



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- You must now scroll down to the ‘Order settings’ where you’ll name the order and give it an ID. Select ‘Continue to line items’.



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- Select your publisher from the drop-down menu. This is the channel where you’ll place your link, for example Facebook. 



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- Next, add the URL that you want the links to lead to in the ‘Click-through URL’ box. You can do this by heading to Amazon, finding your product, and copying and pasting its URL into the box.


- Now click on ‘Create’. 



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Amazon will then generate your attribution tag, and you’re done! 


### Use Your Attribution Tags

Once you’ve got your attribution tags, you need to apply them to your campaigns. For social media ads, for example, you’ll go into your ad manager and copy and paste the tag in the URL fields of the appropriate ads. 

If you’re using your tags for social media posts, you’ll simply copy and paste your tag in the field where it asks for an Amazon ASIN or Store URL.


### Explore Reporting Options and Metrics

Amazon Attribution gives you access to a dashboard that provides visual reporting. From your dashboard, you can access all your campaign data and switch between different campaigns. You can also customize it with the metrics you choose. 



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 Within your dashboard, you’ll  find the option to download your reports. These download as Excel files. You can set these reports to generate as you need them, either on demand or in advance. 

There are four report types you can access:

1. **Campaign reports:** These give you daily metrics on all your campaigns. Through the summary option, you can quickly gain a bird's-eye view of your best and worst performing strategies. 
2. **Channel publisher reports:** With these reports, sellers can identify which publishers or channels perform the best. They’ll then know which channels to invest the most time and money in. 
3. **Keyword and creative reports:** These reports can be generated for campaigns launched with bulk creation. View the performance of creative campaigns and keyword campaigns. The summary report will show you which tactics were the most successful. 
4. **Product reports:** The product reports give you detailed views of how well products perform. Compare promoted products with non-promoted products, and generate reports based on product attributes like color variations or size. 


### Optimize and Refine Your Campaigns

The whole point of gathering and analyzing data is to optimize your campaigns. To make use of this fact though, we need to understand how to use data to your advantage. 

Take a ‘[test and learn](https://www.thedrum.com/opinion/2020/10/05/test-and-learn-your-way-smarter-marketing-decisions)’ approach to pinpoint successful tactics and refine them as you learn. Testing your campaigns will help you pick components from successful campaigns and tie them together to make an even better campaign. 

Here’s an example of this in practice:


#### Example 1:

You run a promotion for one of your Amazon products. You have two ad variations, one with a specific time-bound message like ‘one day only’ and one with a vague time-bound message like ‘deal ends soon’. From this test you discover the specific time-bound message drives higher conversions. 

To delve even further into the possibilities, let’s combine this with another example. 


#### Example 2:

The product you’re promoting has two unique features. We’ll call them ‘Feature 1’ and ‘Feature 2’. In a different campaign, you create two ads, one focusing on Feature 1 and the other focusing on Feature 2. The ad focusing on Feature 2 leads to stronger engagement. 

Now for future product campaigns you understand the type of language that encourages the best results, i.e specific time-bound messaging, along with the feature that most appeals to your audience, i.e Feature 2. 

Continue to refine your tactics by tracking engagement associated with different elements like wording, images, CTAs, and channels. Perfect your combination of elements to craft the perfect marketing campaigns for your Amazon business. 

It’s essential to change just one element at a time so you know what factor is influencing the decision. For example, if you run the exact same ad on Facebook and Google, and you get better results from Google, you know for sure that’s the driving factor, as opposed to a different image or CTA. 


## Amazon Attribution Best Practices

- **Create different ad groups and tags for each strategy:** Do you want your ads to drive awareness, conversions, or considerations? Create a separate ad group and tag for each strategy and for each product. For example, you might decide you want to increase awareness and conversions for a product. Your ‘awareness’ ad group would have one tag and your ‘conversion’ ad group would have another, allowing you to test them both simultaneously. 
- **Keep your goal in mind when choosing your URL:** If your goal is to increase brand exposure, for example, you might want your URL to lead to your storefront. On the other hand, if you want to increase conversions for a specific product, you could add a URL that leads to the product detail page instead. 
- **Create different tags for each element:** This includes different ads, links, and buttons. This allows you to gather insights at a really granular level for very precise data.
- **Bulk upload:** Create multiple tags at the same time using Amazon Attribute’s ‘bulk upload’ feature. With this, you can measure the success of 8,500 Facebook and Instagram ads, and up to 100,000 Google keywords. 
- **Check your traffic regularly:** Keep an eye on the traffic coming from each tag. Consider checking them weekly for optimum results. 
- **Enrol in the Brand Referral Bonus program:** Don’t forget to enrol in this program to benefit from traffic referral bonuses. 


## Get Amazon Attribution Ready

If you're marketing your business on multiple channels outside of Amazon, Amazon Attribution is the best way to measure the results. The free platform allows you to keep track of clicks, purchases, and page views that come from each tag you generate. This gives you a complete picture of your entire campaign. 

While Amazon Attribution is great for optimizing campaign success through different channels, what about optimizing your in-Amazon ads? Merch Jar is an Amazon ad software with which sellers can save time and money through automation and keyword refinement. [Register today](https://app.merchjar.com/register) to start creating winning ad campaigns. 


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Amazon currently stands as the most popular e-\`commerce platform, boasting over [300 million active users worldwide](https://sell.amazon.com/blog/grow-your-business/amazon-stats-growth-and-sales). With such a thriving consumer base, the platform provides sellers with an amazing opportunity for lucrative growth through its Amazon Marketing Services (AMS). 

AMS can help Amazon sellers get their products in front of relevant customers based on product offerings, keywords, and buyer interests. However, many new sellers still don’t know how to use it effectively. In this comprehensive [MerchJar](https://merchjar.com/) guide, we’re going to show you how you can leverage AMS so that you get the sales you deserve!


## What is Amazon Marketing Services?

Let’s start with the basics–what is Amazon Marketing Services, and why should you care? 

Amazon Marketing Services (AMS–also now known as Amazon Advertising Console– is a collective term used for multiple Amazon seller services. Essentially, AMS is the set of advertising tools that help sellers run and manage their ads on Amazon. 

According to Statista, from 2022, Amazon accounts for [37.8% of the e-commerce market share](https://www.statista.com/statistics/274255/market-share-of-the-leading-retailers-in-us-e-commerce/) in the U.S., followed by Walmart, Apple, and eBay, holding 6.3%, 3.9%, and 3.5%, respectively. Clearly, this wide margin shows that Amazon takes the online retailing cup by a long shot. More importantly, a large percentage of customers find sponsored ads helpful, so it’s definitely worth your effort to prioritize Amazon Marketing Services. 


## Different Types of Solutions Offered in Amazon Marketing Services

Since first launching its advertising solutions, Amazon has been increasing its marketing options for sellers. It first started with **Sponsored Products**, then extended to **Sponsored Brand ads** (previously known as Headline Search ads) and **Sponsored Display ads** (previously known as Product Display ads). It’s important to know that within every ad type, the targeting options are also increasing, so we’re going to help you understand these three popular options a little better so you can grow your business on Amazon. 


### Amazon Sponsored Products



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Amazon Sponsored Products promotes your products to buyers on Amazon that are searching for specific keywords or looking at similar products. Only certain product categories are eligible to use this ad type, and they need to be eligible for the [Featured Offer](https://kdp.amazon.com/en_US/help/topic/G202138850) program that has performance-based requirements. The major benefit is that Sponsored Products ads will always appear in very noticeable areas, such as the first page of search results.

Sponsored ads are pay-per-click, meaning you’ll only pay when a customer clicks on your ad. You’ll also be able to set a budget to manage how much you want to bid for every click. Amazon typically recommends a daily minimum budget of $10. 


### Sponsored Brand Ads



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Sponsored Brand ads will showcase a collection of products from your brand to buyers that are searching for specific keywords on Amazon. This ad type is cost-per-click (CPC), and you’ll be able to add your brand logo, a personalized headline, and multiple products you want to promote. 

The main goal of Sponsored Brand ads is to help you increase product awareness by reaching your target audience. When buyers click on your logo, they will be taken straight to your Amazon store or a custom landing page. If they click on a specific product, they’ll go straight to the product page. Sponsored Brand ads are only available for professional sellers enrolled in the Amazon Brand Registry and book vendors and agencies. 


### Amazon Sponsored Display



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Amazon Display ads help you get the attention of buyers on and off the Amazon platform that viewed your products or similar products. This is a self-service Amazon Marketing Services advertising option. You’ll be able to create simple campaigns and automatically generate display ads that will get you clicks.  

The goal is to reach your target audience anywhere online and drive them to your detailed landing pages. Sponsored Display ads are available to professional vendors enrolled in the Amazon Brand Registry, and agencies with clients who sell products on Amazon. 


## Why are Amazon Marketing Services Important?

- **Improve Brand Awareness**: The main benefit of AMS is that it puts your products in front of as many relevant customers as possible. This makes it much easier for you to guarantee sales that you would have never been able to get before. 
- **Attract New Customers**: By using Amazon Marketing Services, your ads will often show up right when customers are about to purchase a competitor’s product. This is the perfect way to give customers the opportunity to consider your offering over your competitors because they’ll be able to make a clear comparison. The best part is you’ll be able to gain brand-new customers without too much effort. 
- **Increase Storefront Traffic**: Depending on the ad type you choose, you can automatically redirect interested customers to your storefront. This way, they can dive deep into any other relevant products of yours that they may be interested in.


## How To Effectively Use Amazon Marketing Services


### #1: Determine Your Advertising Goals

The best first step to using AMS effectively is determining your advertising goals, so you have a clear picture of your desired outcomes. Your goals must be S.M.A.R.T– Specific, Measurable, Achievable, Realistic, and Timely. 

This is what S.M.A.R.T goals can look like: 

1. Gaining 20 positive reviews for a product within a 6-month period
2. Clearing a products inventory through sales before launching a new product
3. Increasing a specific product’s sales by 10% within a 3-month period 


### #2: Conduct Thorough Research

Before creating your ad campaign, you need to ensure you’re conducting research to make your ads as relevant and appealing to your audience as possible. When delving into this process, you should be: 

- Learning more about your target buyers’ interests.
- Finding out the best-suited keywords and phrases for your products. Don’t just rely on Amazon to provide them for you because you can miss out on gems that bring you more revenue.
- Identifying cross-selling opportunities for your products. For example, if you sell phone cases, you can also target buyers looking for screen protectors. 


### #3: Create Compelling Ad Campaigns

Of course, before you create your ad campaign, you’ll need to select the ad format you want out of Sponsored Product ads, Sponsored Brand ads, and Sponsored Display ads. If you have the budget for it, you’re also free to choose all three. It’s also a great idea to test each one to see which format leads to higher conversions. 

Now, as you're creating your ads, you don’t have to consider including all of your products. Just highlight the products that will resonate the most with your target audience. 

Here’s a short checklist you can refer to when developing your eye-catching ad campaigns: 

- Engaging headlines to encourage clicks
- Include your distinct brand logo
- Clear product images
- Persuasive ad copy that aligns with your target customers’ needs
- Include CTAs such as “Learn more”



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### #4: Supercharge Your Campaign With Various Advertising Tools

If you want some extra help managing your Amazon advertising campaigns, it’s not a bad idea to look at some tools. 

[MerchJar](https://merchjar.com/) is an Amazon ads optimization software solution that’s dedicated to helping Amazon sellers automate and [manage ad campaigns](https://merchjar.com/blog/the-ultimate-guide-to-amazon-ad-management) so that you can attribute the majority of your efforts to growing your business.

Our formidable tool’s flagship feature, [Recipes](https://merchjar.com/features/recipes), ensures that you get the ad automation of your dreams. It works by performing routine maintenance operations on your ads, like pausing specific campaigns, increasing your set bids, or lowering your budgets depending on the preset conditions you’ve set. This way, you can always make sure that your ads are continuously being optimized to meet the goals you set out at the start without doing much of the heavy lifting yourself. 

 

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### #5: Allocate Your Budget Appropriately

Establishing your budget for your ad campaigns ensure that you’ll be able to get the best ROI. 

Some best practices for determining your budget are: 

- Calculate your average cost of sale
- Determine how long you want your ad to run 
- Select a default bid amount
- Estimate your ROI so you have a benchmark figure to refer to


### #6: Set Targeting Options

It’s important to make good use of Amazon’s in-built [auto-targeting tools](https://advertising.amazon.com/API/docs/en-us/sponsored-products/auto-targeting) such as “Automatic Targeting” and “Advanced Targeting”. These tools will help you effectively refine the audience that your ads will be placed in front of. This is also why it’s important to do your research when planning your ads. 

Amazon Marketing Services will give you the options of two main targeting methods–interest-based and product based. It’s best to use both so that you’re able to reach a wider audience. 



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### #7: Optimize Bids Regularly

As you continually test your ads to see which formats are the best fit, you’ll then need to optimize them regularly so that they keep improving. Make sure to look out for these aspects so that you can remove the assets that are underperforming:

- The products producing the highest conversions
- The best-performing ads for your products
- The most popular model or color of a specific product type
- The product keywords that are producing the highest conversions
- The ad copy with the highest click-through-rate 


### #8: Analyze Campaign Performance 

To ensure you’re getting the most out of your ad spend and meeting your business goals, you’ll need to consistently analyze the performance of your ad campaigns. A good practice is creating Amazon advertising reports to keep a comprehensive track of important metrics. 

Some metrics you should be tracking are:

- Ad impressions
- Total clicks
- Cost per click
- Cost per 1,000 impressions

Fortunately, you can easily access this data in real-time via reporting dashboards within Amazon Marketing Services. 


## Conclusion

Amazon Marketing Services is an extremely useful tool for businesses to get their product offerings in front of their target customers and increase ROI from their ad spend. However, as we’ve discovered, it’s important to perform adequate research and continuously test your advertising efforts in order to utilize the service effectively. 

To make your life a whole lot easier, consider useful tools such as [MerchJar](https://merchjar.com/) to automate the tedious parts of using and managing your ads. You’ll be able to regularly optimize your campaigns so that you’re always ahead of your competitors with prominent features like [Recipes](https://merchjar.com/features/recipes) and [Smart Bids](https://merchjar.com/features/smart-bids). Ready to check it out for yourself? Supercharge your campaigns today with a [30-day free trial](https://app.merchjar.com/register)!

 


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If you’re looking to sell Amazon FBA private label products, you’re in the right place. Amazon Marketplace is thriving. In 2021, a survey concluded that [98.07 million](https://www.oberlo.com/blog/amazon-statistics) U.S consumers accessed the Amazon app at least once per month. In the same year, [Amazon reported](https://assets.aboutamazon.com/9b/84/05cb2fc14da18e4574a5132f675a/amazon-smb-report-2021.pdf) there were around 2 million SMBs selling on Amazon. This makes an Amazon FBA private label venture potentially very lucrative. 

However, with so many sellers getting in on the Amazon action, competition on the platform is high. As such, it’s essential for new and existing sellers alike to maximize their advertising efforts to stand out from the crowd. 

That’s where [Merch Jar](https://merchjar.com/) comes into play. Merch Jar is a software that allows users to create automation ‘recipes’ that eliminate the need for endless manual ad optimization by automatically performing tasks like adjusting bids and pausing unprofitable ads. 

If we’ve piqued your interest, stick with this article to learn exactly what Amazon FBA is and how to launch your business.


## What is Amazon FBA Private Label?

FBA stands for Fulfilled by Amazon. It’s essentially a service that Amazon provides to simplify the process of selling on Amazon and gives sellers an extra layer of credibility. Sellers ship their products to an Amazon fulfillment centre, where Amazon stores the products in their warehouse and when a customer makes a purchase, Amazon packs it and posts it to the buyer. 

As an added bonus, these products are included in the unlimited one-day delivery perk that Prime members can take advantage of. 

Private label products are products that sellers buy from manufacturers and customize with their own branding, such as logos and company slogans. With private label products, entrepreneurs can build their own brand. This allows them to develop brand loyalty and enjoy less competition, while having greater control over their prices and promotions.  

Even Amazon has its own private label brands. Below is an excellent example of this in action with Amazon’s most popular private label brand, ‘[Amazon Basics](https://www.amazon.com/s?k=amazonbasics)’:



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Although it’s clear from the name that Amazon owns this brand, it has carved out its own brand identity that’s a separate entity to Amazon itself. 


## How to Sell Private Label Products on Amazon FBA

There are numerous steps involved in selling online,whether you’re an [MBA print-on-demand](https://merchjar.com/blog/merch-by-amazon-mba-insider-best-practices-you-must-know-about) business or getting involved in arbitrage (selling other brands’ products). 

Today, we’re now going to get into the nitty gritty of how to sell private label products on Amazon FBA. 


### 1. Choose a Product

Product selection is one of the most important considerations when selling on Amazon. It’s not enough to simply choose products that appeal to you or you think other people might want to buy. You need to do research before committing to your products. 

Here’s some criteria to consider:


#### High Demand

Buying trends typically fluctuate, with demand for some products lasting a short time and demand for others lasting longer. Your best bet for long-term growth is to identify products that people always need, like kitchenware for example. 

To find out what’s popular on Amazon, you can check Amazon’s ‘Best Sellers’ list and track product categories over time to identify any trends. Alternatively, you can use an extension like[ Amazon Product Finder](https://chrome.google.com/webstore/detail/amazon-product-finder-amz/njopapoodmifmcogpingplfphojnfeea?utm_source=site&utm_medium=amzscout&utm_campaign=menu). This will tell you information like whether products are in high demand and what your profit margins could look like. 

Once you have this in place, you can start honing in on the right products for your niche and brand. 


#### Low Competition

While you want your products to be in high demand, the less competitors out there, the better. Check out the number of listings for your shortlisted products on Amazon. 

However, don’t feel too discouraged if the competition is a little high. With tools like Merch Jar, you can [develop a winning bidding strategy](https://merchjar.com/blog/how-to-develop-a-winning-amazon-bidding-strategy-plus-tactics) by sourcing the most impactful keywords for your product ads. This can give you a strong edge over your competitors. 


#### Low-Risk Products

Low-risk products are products that are most likely to sell and/or generate a ROI. There are a number of aspects that make a product low-risk including low competition, which we talked about above. A low-risk product can also be attributed to high selling prices, market sustainability, and low-cost PPC ads. In essence, a low-risk product is that which carries minimal financial risk to the seller because of the high-reward potential. 


### 2. Specify Product Attributes

Consider and research potential private-label products to sell on Amazon with the following attributes:

- **Small and light:** Sell products that are under 1kg in weight to save on costs associated with manufacturing and FBA. Amazon storage charges reflect the space they take up in their warehouses. So, large items will cost you more. 
- **Non-seasonal:** While seasonal products can fly off the ‘shelves’ during special occasions like Christmas and Valentine’s Day, you should avoid seasonal goods when you’re trying to build a long-term, sustainable, and scalable business. 
- **Easy to sell:** Ensure your private label products are easy to sell by avoiding things that come with legal and compliance restrictions. With food products, for example, all ingredients must be legal to sell in the country you’re selling in, and all dietary requirements have to be clearly labeled on the packaging. Equally, selling products with batteries can come with complications.
- **Reliable:** To avoid being flooded with returns and damaging your brand name, ensure you pick products that are reliable. When we talk about ‘reliable products’, we’re referring to those that continue to perform their intended function for an acceptable period of time. Naturally, the length of time depends on the product. 


### 3. Find a Reliable Manufacturer

Now it’s time to find your manufacturer. Don’t assume the cheapest manufacturer is the best option. You want your products to be good quality so that you can build a brand reputation for selling dependable products. You’ll find that customers are often willing to pay a little more for higher-quality items. 

Read reviews online for different manufacturers and check aspects like minimum order quantity. When you’re just starting out, you’ll want to test the waters with smaller quantities before diving into large orders.

Come up with a shortlist of 3-5 potential manufacturers. You can then email each of them with questions like:

- How much do you charge to manufacture customized products?
- Do you provide sample products? If so, how much do these cost?
- What is the manufacturing time for X product?

Once you’ve opened up this line of communication, keep track of how long it takes for each manufacturer to respond. The prompter, the better. 

Remember, a sample product is an essential part of the process. This is how you determine the quality of the products you’re going to sell, along with the reliability of the manufacturer. It’s also the baseline for negotiating prices with your manufacturer. 

If you’re choosing to go down the ‘print-on-demand’ route, [Merch by Amazon](https://merchjar.com/blog/merch-by-amazon-mba-insider-best-practices-you-must-know-about) is a good way to go. You don’t need to handle any products you sell. You simply sign up, upload your designs, and Amazon will print them onto t-shirts and ship them out to customers who buy them.


### 4.  Design your Private Label’s Logo and Packaging

Once you know what you’re going to sell, you can design your logo and packaging for your private label FBA business. Your designs will reflect your brand and how your customers view it. Branding elements, like logo and color scheme, will help form your brand identity. 

If you’re not a whiz with logo and packaging design, work with a graphic designer. There are many affordable options on the web, whether you choose a graphic design company or a freelance designer. 


### 5. Create Amazon Product Listings

Create your Amazon product listings with clear and crisp images of your products. You want to showcase them with good lighting and from different angles. When it comes to your product descriptions, consider working with a copywriter to craft concise descriptions that not only convey the features and benefits of your products but also incorporate your brand’s personality into the text. Scannable bullet points are also a good way of sharing the most important information quickly. 

**Side note:** Amazon has a brand registry program for private label sellers. This is optional, but signing up for this program will protect you from things like copyright infringement and will also allow you to access some additional marketing tools. 



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### 6. Create Your Landing Page

When you’ve registered your brand, you can create a free branded landing page for your business. This will help to reinforce your brand image and convey professionalism. Below, you’ll see an example of a [landing page for Carote](https://www.amazon.com/stores/page/8278A13A-3927-4D55-ACBF-CB88843E1528?ingress=2&visitId=2b90ce21-e79c-4dc4-9d77-08fa32411a9b&ref_=ast_bln); a kitchenware store that sells products that are ‘Inspired by nature’. 



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You’ll notice that you’ll get a good feel for the brand’s values and identity just by looking at this page. The colors are consistently neutral - in line with their ‘nature’ values. And, there are lots of great quality images of their products. 


### 7. Invest in a Professional Amazon Advertising Service


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Investing in a dependable and professional Amazon advertising service can give your Amazon FBA private label business a significant boost in sales and exposure. [Merch Jar specializes in Amazon PPC ads](https://merchjar.com/learn). With our solution, users can put their advertising on autopilot with automatic bid adjustments through our Smart Bids feature. 



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Configure your settings to reflect your minimum and maximum bids, along with your target thresholds. Then, sit back and watch your PPC ads become more efficient and effective with 24/7 bid automation. 



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Using a [top Amazon advertising tool](https://merchjar.com/blog/top-amazon-advertising-tool-and-amazon-ppc-software) like Merch Jar, Amazon sellers can save an enormous amount of time adjusting their bids and maximizing their campaigns. Avoid the trap of micro-managing and spend more time sourcing and listing your products while being confident your ads are targeting the right people with the right keywords. Set daily budgets and customize your bid triggers with recipes. 


### 8. Fulfill Your Orders With FBA



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Your last step in launching your Amazon FBA private label business is to sign up to make sure your orders are fulfilled. You then send your products in bulk to an Amazon warehouse. Amazon will subsequently handle returns and refunds in addition to shipping your products to your customers. This is the most efficient way of selling on Amazon. 


## Is it Time to Begin Your Amazon FBA Private Label Business?

An Amazon FBA private label business does not have to be as complicated as you might think. With the proper tools and resources, you can work on developing a scalable business with good-quality products, and quick and reliable service. 

Automating your Amazon ads will save you considerable time. It will also ensure you are making the most of your advertising budget. With Merch Jar, you can prune bad keywords so you’re only focusing on the best-performing ones. 

If you’re ready to begin automating your Amazon ads, simply [register to begin your 30 day free trial](https://app.merchjar.com/register). 


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Many Amazon sellers have come to understand that using paid advertising can help push them ahead of their competition. 

Though some will realize pretty quickly that advertising on Amazon is tough, especially if you haven’t got much marketing experience, the most astute Amazon sellers soon see that there are tools available that let them undertake comprehensive marketing campaigns without any prior experience. 

So, to those of you reading that count yourselves among this cohort, today we’ll give you the lowdown on the top Amazon PPC software tools, including our very own [Merch Jar](https://merchjar.com/), so you can go forth and reap the benefits of the best Amazon advertising tools currently available.  


## What is Amazon PPC Software?

Amazon PPC (Pay-Per-Click) software refers to tools that are designed to help Amazon sellers manage and optimize their advertising campaigns on the Amazon platform. 

PPC advertising allows vendors to promote their products or services on Amazon and pay only when shoppers click on their ads.

Typically, Amazon PPC software solutions will include features such as keyword research, bid management, campaign optimization, ad creation, and various kinds of reporting. 

These tools help vendors identify the most relevant keywords for their products, optimize their ad spend, and track the performance of their campaigns.

The top Amazon PPC tools will allow sellers to create and manage multiple advertising campaigns at a single time through automation processes powered by AI and machine learning algorithms.


## Why these tools are important?


### They Help Save Time & Cost


To build on that final point in the previous section, the greatest benefit bestowed by Amazon PPC tools is the sheer amount of time and costs they can save. 


Only a few years ago, the task of setting up and managing just a single PPC campaign would take tens of hours out of a working week. 


These days, with the right tools and automation features, you can have multiple campaigns up and running seamlessly in a fraction of the time it once took, allowing you to focus your energies elsewhere.


### Better ROI

In addition to saving bags of time, Amazon PPC software will also improve the ROI from your PPC activities. 

By making proper use of features like keyword research and bid management, you can ensure you only bid on the best keywords for your products, and you never pay too much for certain ad positions. 

More traffic + less spend = improved ROI.


### Good for Remaining Competitive


Amazon is not dissimilar to Google in that it works like a search engine, only for goods and products rather than information. And, much the same as Google, position, and prominence are key. 


In order to achieve greater visibility and win new customers, they have to know a little about you, and sometimes it just isn’t enough to rely on organic search results. 


As such, PPC campaigns go a long way to boosting brand recognition and brand awareness - and using the right tools can put you in places you’d never have been able to reach without them. 


## Criteria to Consider When Looking for Amazon PPC Software


### What features am I looking for?

Amazon sellers generally require three main features in any PPC software they might consider.

**Automation, Analysis**, and **Optimization**.

Good Amazon PPC software will boast heavy automation features and robust analysis and reporting tools, and it should provide guidance on what steps you should take to optimize your PPC campaign(s) further. 


### Budget Management.

Any worthwhile tool for Amazon PPC needs to provide a form of budget management functionality.

Using budget management features will allow you to control your spending without it getting out of control until such time as you have refined your campaign to optimum spending levels. 


### Broad Marketplace Availability 

Living in a digitally based, global society as we do, it would be remiss of any vendor not to consider the myriad other marketplaces outside of the US’s Amazon.com.

Amazon operates in 20 other countries besides the USA. This is an often untapped resource for many American and Western-based companies. 

Ideally, then, you want a PPC tool that will allow you to enter into and capitalize on these alternate regions.

[Merch Jar](https://merchjar.com/) is an all-in-one Amazon PPC software solution and Amazon Ads partner that delivers unprecedented, bespoke automation processes through its “[recipes](https://merchjar.com/features/recipes),” allowing you full, customized control of your ad campaigns. 



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## Best Amazon PPC Software


### #1: Merch Jar

Merch Jar is full automation Amazon PPC solution. You can manage and automate multiple campaigns with just a few clicks by using their recipes, smart bids and analytics dashboard. 

**Features:**

**_Recipes:_** Recipes are Merch Jars’ flagship feature that lets you create powerful and complex automation to manage your entire advertising catalog. **

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**_Smart Bids:_** Merch Jar’s Smart Bids algorithm analyzes your advertising data and automatically makes small, daily bid changes to keep your campaigns in line with your ACoS goals.



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**_Analytics Dashboard:_** Review and refine your PPC campaign input based on actionable data insights from Merch Jar’s analytics dashboard to help truly optimize your campaign automation.

**Pricing:**

Pricing on Merch Jar is nice and simple. Prices start at $50 p/m for users with up to $2000 monthly ad spend. For any ad spend above this level, the prices increase incrementally. 



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### #2: ZonTools

Zon Tools is an automation and management solution for Amazon PPC that is built on proprietary, in-house AI technology. 

**Features:**

**_AI-Powered:_** ZonTools has built 9 different engines powered by its in-house AI to power  solutions for keyword analysis, bid management, and much more.

**_Recommended Bids:_** ZonTools shows the Amazon recommended bids for your ads that will work to optimize the sales and profits of your products.

**_Automation Insights:_** Never miss out on key information again with ZonTool’s automation log, recording every single aspect of your PPC campaigns and providing you with valuable insights into performance. 

**Pricing:**

Pricing for ZonTools comes with three different licenses. 

Prices start at $9 p/m for the Analyzer package, which will give most people enough to get started. 

The Master license is $19 p/m and opens the door to some of the AI engines not available at the Analyzer level. 

Dominator is the top tier, where you basically get access to everything they offer for $25 p/m.



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###  #3: AdBadger 

AdBadger is an Amazon PPC software tool that does everything you’d expect in terms of planning and reporting. 

In addition to its software, the company focuses on educating its customers to become proficient at managing PPC campaigns through paid services like Amazon PPC Coaching.

**Features:** 

**_Negative Keyword Finder Tool:_** No more boring or cumbersome search term reports. AdBadger’s negative keyword finder identifies poor-performing keywords and prunes them automatically.



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**_Badger™️ Bid Algorithm:_** Ad Badger’s Bid Algorithm analyzes the anticipated Revenue Per Click (RPC) against the CPC of every keyword in your account. Then, as conversion rates fluctuate, the Bid algorithm adjusts your bids accordingly.



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**_Ad Manager:_** AdBadger Ad Manager is a suped-up version of Amazon Ads. New and Improved, it is much quicker, delivers more accurate searches, and provides key metrics reporting all in one easily accessible dashboard. 



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**Pricing:**

AdBadger works on a usage-based pricing model starting at $400 p/m.  


### #4: Downstream 

Downstream was founded by two former Amazon employees and was built specifically to meet the requirements of Amazon sellers. The tool is built with machine learning incorporated, allowing for automated campaign management that improves the longer you use it. 

**Features:** 

**_Always on Automation:_** Ad campaigns are automatically and continuously optimized by the machine learning algorithm - you set the KPIs and watch it go to work!



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**_Channel Insights:_** Shelf Intelligence is a recommendation engine that lets you gain insight into the competitive landscape and see trends in search activity. It then delivers intelligent campaign adjustments based on these findings. 



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**_Custom Dashboards and Labels:_** highly customizable dashboards and labels to help define and group campaigns, meaning information can be sorted and accessed easily for a more streamlined process. 



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**Pricing:**

Pricing information for Downstream is not publicly available.


### **#5:** PPC Entourage

PPC Entourage from Plutus Systems is an Amazon PPC tool that enables you to manage bulk campaigns in a single engine whilst benefitting from strong automation and data-driven analytics. 

PPC Entourage is so confident in its solution that they offer a one-year money-back guarantee to any customer unsatisfied with the product after the first twelve months.

**Features:**

**_Search Term Optimization Automation:_** Using PPC Entpuorage’s Smart Pilot allows you to set up processes to eliminate poorly-performing search terms from your campaigns automatically.



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**_Bulk Optimization & Expansion:_** Easily switch between ad types (Sponsored Product, Sponsored Brand, Sponsored Brand Video, and Sponsored Display) and dive into deeper metrics for all your bulk optimization requirements. 



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**_Entourage Margins:_** This provides you with actionable data and metrics to reduce ad spend, avoid costly fees, and dive deeper into why some campaigns aren’t performing as they should.

**Pricing:**

PPC Entourage pricing is offered on a subscription-based model in which PPC Entourage will charge 2.9% of monthly ad spend. Their primary client base has a monthly ad spend of between six and nine figures. ****


### **#6:** PPC Ninja

PPC Ninja provides Sponsored Products ad management software for Amazon sellers in addition to a range of consultancy offerings, including PPC account audits, campaign and listing optimization strategies, and other bespoke services.

**Features:**

**_Bid Recommendations:_** Amazon does not allow Advertising Cost of Sale targets in their system. PPC Ninja gives you weekly suggestions for campaign adjustments based on your ACoS targets so you can maximize your profitability.

**_Keyword Bid Change History:_** Visually track your historical bid changes to fully understand how your keyword management is succeeding and identify further areas for improvement.

**_PPC Sales by SKU:_** Learn how your PPC sales perform per stock-keeping unit across all campaigns, so you can improve both your margins and identify the inventory you hold that returns the greatest value.

**Pricing:** 

With PPC Ninja pricing is based on Amazon Standard Identification Numbers (ASINs). 

For companies offering fewer than 100 unique ASIN products, PPC is available for $99 p/m with the Grow Ninja package.

Companies with 100-499 ASINs will need the Scale Ninja package at $299 p/m, whereas companies with between 500-2500 products will be enrolled in the Pro Ninja package for $499 p/m.



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## Conclusion


And there we have our top Amazon PPC tools. As is always the case, you should choose the tool that fits your business objectives and doesn’t break the bank. Thankfully, with this guide, you’ll be able to make an informed choice on the PPC software your company needs. 

Merch Jar, with its ground-breaking automation, more than keeps pace with any alternate providers and it does so at a very reasonable price point. You can [register](https://app.merchjar.com/register) today and learn for yourself just what Merch Jar can do for your PPC campaigns. 


top-amazon-advertising-tool-and-amazon-ppc-software


Selling products on Amazon can be tough, especially if you’re just starting out. With so many competitors in the market, it’s crucial for businesses to advertise on the platform. Amazon advertising involves a lot of strategic bidding since they operate on an auction-based system.

If you want to get your ads out there, you must place winning bids and beat your competition. You may need to adjust your bids if they perform badly, so you should regularly monitor them with [Merch Jar](https://merchjar.com/) and automate this process.

Here, you can learn how to develop your own winning Amazon bidding strategy, but first, let’s talk about the basics behind Amazon bidding.


## What is Amazon Bidding?

Amazon bidding is where sellers place bids on specific keywords or products in order to get their ads showcased on the site. When shoppers search for those keywords or click on certain product listings, your ad has a chance of appearing. Most of [Amazon advertising](https://merchjar.com/learn/amazon-advertising-beginner-quick-start) is pay-per-click, which means you only pay the bid when someone clicks on your ad.


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## Different Types of Amazon Bidding


### Dynamic Bidding (Down Only)


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Amazon lowers your bids (up to 100%) when your ad is unlikely to generate conversions. This helps you save up on ad costs.


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#### When to use

When you’re looking to increase returns or reduce your ad spending.


#### Focus

Cost reduction.


### Dynamic Bidding (Up and Down)


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Amazon raises your bids (up to 100%) when conversions are likely and lowers your bids when your ad is unlikely to make sales.

**_

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_**


#### When to use

When you want a flexible bidding strategy, or your bids are prone to change.


#### Focus

Sales and efficiency.


### Fixed Bids


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Your bids are set in stone unless you manually change them.


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#### When to use

Fixed bids don’t account for your likelihood of conversion, so we don’t recommend them. You’ll probably end up overspending or not spending enough on your bids. Sellers usually make fixed bids when launching a product or improving their brand visibility.


#### Focus

Impressions and sales.


### Rule-Based Bidding

Amazon adjusts your bids based on a set of rules you’ve put in place. They follow this line of logic: ‘**If** this happens, **then** this bid or keyword changes’. Rule-based bidding is only for campaigns that have been running for at least 30 days.


#### When to use

When you want more control over your bidding or wish to hit your target ROAS (Return on Ad Spend).


#### Focus

More control over ad campaigns.


## Basics of Amazon Bidding


### Profit-Driven Bidding

The main goal of Amazon bidding is to increase your profit through [ad optimization](https://merchjar.com/learn/4-amazon-ad-optimization-to-make-every-week). You should aim to drive conversions whilst keeping your ad spend low enough to generate profit.


### Advertising Cost of Sale (ACOS)

Your ACOS compares your ad spend to your ad revenue to see how cost-efficient your campaign is. You can set a [target ACOS](https://merchjar.com/learn/choosing-your-ideal-target-acos) to ensure you reach your desired profit margin. If you want an overall look at your profit, we recommend you use TACOS (Total Advertising Cost of Sales) instead.


### Automatic Targeting

Automatic targeting allows Amazon’s algorithm to choose relevant keywords and products for you. This is ideal if you’re unsure of how to [structure your Amazon advertising campaigns](https://merchjar.com/learn/structuring-your-amazon-advertising-campaigns) or where to start with your bidding.


### Manual Targeting

Manual targeting involves bidding on keywords and products yourself. This way, you have more control over your campaign and where your ad appears.


## How Does Amazon Bidding Work?

1\. Go to [Amazon Seller Central](https://sellercentral.amazon.com/) and log into your account. Once you’re in, navigate to the **Campaign Manager**.


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2\. Select ‘create campaign’.


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3\. Pick a campaign type from the three options available:

- Sponsored Products
- Sponsored Brands
- Sponsored Display

In this example, we’ll be going with **Sponsored Products**.


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4\. Fill out your campaign details:

- Campaign Name
- Portfolio
- Start and End Date
- Daily Budget
- Targeting
- Bidding Strategy


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5\. You have the option to create an ad group, where multiple products can share the same target keywords and bidding. Name the group, and add the relevant products.


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6\. Set a default bidding price (refer to the suggested bid if you’re unsure).


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For a more comprehensive method of bidding, use Merch Jar’s [Smart Bids](https://merchjar.com/features/smart-bids) tool to fully automate your bid adjustments.


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Smart Bid’s detailed logs allow you to closely monitor when and why bids were altered. You can filter by ad type, date, or specific ad to get insights into your ad optimizations.

7\. Finally, click **Launch Campaign** to go live with your ads.


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## How to Develop a Winning Amazon Bidding Strategy

The best Amazon bidding strategies are optimized for efficiency’s sake, which is where automation tools like [Merch Jar](https://merchjar.com/) can come in handy. Here at Merch Jar, we automate your bid management, do keyword isolation, and much more to take the stress out of Amazon advertising. Instead of wasting time with spreadsheets and management, you can focus on growing your business.


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### Begin With the Fundamentals

Your bidding strategy should help you build a long-term business on Amazon, which ideally means continuous profit. Start by setting an overall budget for your seller account and your expected profit margin, along with other relevant goals:

- Revenue
- Impressions
- Clicks
- Target ACOS

Make sure you have systems in place to help you track all your costs and commissions. After your campaign goes live, you can calculate ACOS to determine how effectively you’re spending your money:

**ACOS = (Ad Spend ÷ Ad Sales) x 100**

ACOS can help you understand how much profit your ad campaign generates. However, it has its limitations and doesn’t consider your total sales. For a more holistic approach, calculate TACOS:

**TACOS = (Total Ad Spend ÷ Total Sales Revenue) x 100**


### Relevance Helps Keep Costs Down

Only bid on keywords that are relevant to your product. Shoppers who search those keywords are more likely to buy your product, which can increase your conversion and click-through rates. The higher your rates, the higher up your ads will feature in search results.

Amazon also tries to showcase appropriate ads to their users, so choosing irrelevant keywords can hurt your chances of being seen. There’s even a feedback system in place, which allows users to complain about ads being irrelevant.



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### Calculate Optimal bid

There are ways to determine the optimal bid amount through calculations. The following formula was devised by marketing experts:

**Bid = Max. CPC (Cost-per-click) = (Ad Sales ÷ Ad Orders) x (Ad Orders ÷ Ad Clicks) x (Ad Spend ÷ Ad Sales)**

The formula can be simplified in the following ways:

**Bid = Max. CPC = (Ad Sales ÷ Ad Clicks) x (Ad Spend ÷ Ad Sales)**

**Bid = Max. CPC = Average Order Value x Conversion Rate x ACOS Target**

These equations merely serve as a foundation to work off of, but they’re useful as metrics when assessing your own spending strategies.


### Adjusting Bids by Placement

Amazon now allows you to raise your bids by up to 900% for **Product Pages** and **Top of Search** placements.


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Amazon often shifts around sponsored product ad placements. Currently, there are three types of placements:

1. **Product Pages** — your ads are placed on product detail pages, the add-to-cart page, the shopping basket page, and more places aside from SERPs (Search Engine Results Pages).
2. **Top of Search — your ads show up on the top row of the first search results page.**
3. **Rest of Search — your ads appear in the search results below the Top of Search placements (e.g., middle or bottom of the first page, page 2, page 3, etc.).**

**Dynamic Bidding** allows you to choose specific placements to bid on regarding **Product Pages** and **Top of Search**. **Rest of Search**, which can’t be adjusted, ****is selected by default. Adjusting your bids strategically can help you acquire better ad placements.


### Adjusting Bids for new Campaigns

If you’re new to Amazon Ads campaigns, you may be unsure about how much to bid. As a starting point, you can use Amazon’s suggested bids and adjust them if necessary later on. Suggested bids are calculated based on a group of winning bids for similar ads. They showcase a recommended bid amount as well as a bid range.



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You should try to optimize your bidding in the long run in order to reach your marketing goals.


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### Adjusting Bids by ACOS

It’s also beneficial to adjust bids based on your target ACOS. A lower ACOS is ideal since it usually means a higher profit. The key is to reach your target ACOS, so you may need to raise or lower your bids to stay on track.

Avoid bidding high amounts early on in your campaign. Wait until you’ve got enough data to know how to adjust your bids effectively. If you need a quick way to calculate ACOS or ROAS, check out Merch Jar’s [calculator](https://merchjar.com/acos-to-roas-calculator)**.**


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### Consider Investing in Automation Software to Simplify Processes

Simplify your bid management and improve ad performance with [Merch Jar’s](https://merchjar.com/) powerful automation tools.


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With [Recipes](https://merchjar.com/features/recipes), you can set up various automation, including pausing campaigns, lowering budgets, and raising bids, based on certain triggers or conditions.


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Merch Jar’s [Promotions](https://merchjar.com/features/promotions) lets you fully automate keyword graduation — remove poor-performing keywords and elevate high-performing ones to better manage your budget. Meanwhile, Merch Jar will continue looking for new keywords to save you the effort.





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[Smart Bids](https://merchjar.com/features/smart-bids) is fully focused on automating your bid management, adjusting your bids daily to help you reach your target ACOS. Their comprehensive logs detail exactly which bids were altered, along with when and why they were changed.





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### Continual Testing and Analysis

Regularly check in on your ads and analyze the results to ensure you’re never wasting your budget anywhere. Test out different keywords and match types when bidding (e.g., exact and phrases)**.**


## Conclusion

Amazon bidding is an important part of advertising on the platform, and there are many strategies you can employ, like bid adjustment, to maximize your profits.

However, constantly changing your bids can be very time-consuming, which is why [Merch Jar](https://merchjar.com/) allows you to fully automate this process. [Sign up today](https://app.merchjar.com/register) to start optimizing your Amazon bidding strategy.


how-to-develop-a-winning-amazon-bidding-strategy-plus-tactics


With the rise of ecommerce, many authors have started selling their books online, especially in the ebook format — after all, they’re much cheaper and easier to self-publish. Amazon, in particular, is known for its ebook support, with the KDP (Kindle Direct Publishing) service allowing any author to self-publish (both digital and physical books) for free.

Since Amazon is home to a large variety of products, it can be hard to get noticed by potential buyers. Fortunately, Amazon allows you to advertise your products, and with [Merch Jar](https://merchjar.com/), you can easily optimize your ad campaigns to achieve the best results.


## What is ‘Amazon Ads’?

Amazon Ads is a PPC (pay-per-click) [Amazon advertising](https://merchjar.com/learn/amazon-advertising-beginner-quick-start) service where you only pay when a shopper clicks on your ad. They operate on an auction-based system, which involves placing bids on certain keywords that are relevant to your product.

When customers search for those words on Amazon, your ad has a chance of appearing on the search results page or competitor product listings. Amazon chooses which ads to display based on how well-targeted your keywords are and how much you bid.

## Different Types of Amazon Ads (With Examples)


### Sponsored Products Ad

Sponsored products are ads for specific products which appear in search results and product pages. They help you reach customers who are looking at products similar or related to yours.


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### Amazon Sponsored Brands

Sponsored brands are ads that showcase your brand, which includes your logo, slogan, and a few of your products. They appear above search results in order to capture people’s attention. Sponsored brands are great for raising brand awareness and driving sales.


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### Lockscreen Ad

Lockscreen ads are mainly used to promote ebooks on Amazon Fire tablets and Kindle E-readers. These ads appear on the lock screen or the homepage (for Kindle E-readers). When readers interact with your ad, they should be taken to the relevant product page, where they can easily purchase the book.


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## Benefits of Amazon Ads for Authors


### Campaigns are Quick to set up (no Creatives Required)

Amazon Ads makes it easy to set up ad campaigns without relying too much on visual design. Instead, you can just use your existing book cover and metadata (e.g., title, reviews, etc.) to generate your ads. Without the stress of creating new visuals, you can focus more on [structuring your Amazon advertising](https://merchjar.com/learn/structuring-your-amazon-advertising-campaigns).


### It Helps Raise Your Rank as a Best-Selling Author

Amazon Ads help you drive sales by promoting your books to potential buyers. Since their PPC ads target keywords, they’re more likely to be shown to people interested in your niche.  As you generate more sales, you can raise your category rank and gain more exposure. Maintain a steady stream of sales by utilizing some [Amazon Ad optimization](https://merchjar.com/learn/4-amazon-ad-optimization-to-make-every-week) strategies:

- Lowering or raising bids based on ACOS (Advertising Cost of Sales)
- Pausing poor-performing keywords
- Promoting high-performing keywords


### Amazon Ads Only Charge on a Pay-Per-Click Basis

Amazon Ads only charge you if someone clicks on your ad. Otherwise, you don’t pay a dime. This means you’re only paying when your ad succeeds in drawing in a shopper, not when it fails to get results.

How much you pay depends on your bidding, so make sure to budget carefully. This involves [choosing your ideal target ACOS](https://merchjar.com/learn/choosing-your-ideal-target-acos) and setting profit margin goals.


## Amazon Ads for Authors Best Practices


### Step 1: Determine Your Goals

The basis for every ad campaign starts with establishing your goals. Amazon lets you pick your primary objectives, which you can later measure to see how well your campaign is doing. If you’re struggling to narrow down your goals, Amazon Ads has a quick multiple-choice survey you can take:



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Once you’ve dedicated your goals, determine how you can monitor their success. For example, if your goal is to drive brand awareness, you can measure that by looking at how many impressions or clicks your ad receives.

Here are some other metrics you can use to measure performance:

- Sales
- Orders
- Spend
- CTR (Click-through rate)
- ACOS
- CPC (cost-per-click)

Knowing your goals can help you formulate effective marketing strategies since you have something to work off of. It can even help you decide which ad format to use. For instance, display ads are great for growing brand awareness.


### Step 2: Create a Campaign

When it comes to actually creating your ad campaign, you must first decide what type of ad you want. For authors, especially first-time authors, it’s best to choose sponsored product ads since they have the most reach.

Lockscreen ads are limited to E-readers and Fire tablets whilst sponsored brands only appear on results pages. The latter also requires you to have at least 3 existing books for sale.


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Next, fill out the form, which includes the following details:

- Start date
- End date
- Daily budget (how much you’re willing to pay for clicks each day)
- Targeting (manual vs. automatic keyword targeting)


### Step 3: Ad format

Now we’re on to choosing the ad format. There are two to choose from:


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A custom text ad allows you to add your own text, which you can use to describe your book in an enticing way (keep this relatively short). If you don’t want to include any custom text, opt for a standard ad instead, which won’t include text. That being said, custom text can help you sway curious viewers, so we do recommend writing a small tidbit if you’ve got the talent for it (you shouldn’t have many problems, you’re an author, after all!)



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### Step 4: Set up Your Keyword Targeting Amazon Ads Campaigns

Choosing the right keywords to target is quite a meticulous process. You can discover relevant keywords by searching for similar products on Amazon — look at the search suggestions for potential ideas.



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Alternatively, you can use a free Amazon keyword tool (e.g., [ahrefs](https://ahrefs.com/amazon-keyword-tool)) to find popular keywords related to your book. Once you’ve got a list of keywords in mind, it’s time to set up your targeting campaigns. ****There are three main types of keyword matching you can use:

- Phrase (included in the search term amongst a series of words)
- Exact (perfectly matches the search term)
- Broad (a variation of the search term — e.g., synonyms, misspellings, plurals)

First of all, make sure to select the ‘keyword targeting’ option.


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If your book has already been published on Amazon for a while, you can get some keyword suggestions along with recommended bid amounts in the ‘suggested’ tab.


<Image
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If you’ve only recently released the book on Amazon, go on the ‘enter list’ tab to add your own keywords.


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### Step 5: Take Advantage of Negative Keywords

Now let’s talk about negative targeting — these are keywords your ad won’t show up for. This can prevent your ad from being displayed to the wrong audience (i.e., unlikely customers).


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You can apply these negative keywords to an entire campaign, which affects all ad groups under that campaign. Or, you can choose to only apply them to a specific ad group.


### Step 6: Choose a Start and End Date

Whilst you should set a start date before commencing your campaign, you don’t have to set an end date right away. Try running your campaign for a week or so first to see how it goes before determining when it should end.


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If your campaign seems to be performing quite well, there’s no need to end it anytime soon. However, if it’s costing too much money or not achieving the results you wanted, it may be worth shutting down.


### Step 7: Control Your Costs

Your daily budget is the maximum amount you’re willing to spend on clicks per day. If you surpass this amount, your campaign is paused for the day. So, it’s important to set and adjust your budget according to your ACOS and ROAS (Return on Ad Spend).


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Before setting your daily budget, decide how much you want to spend on each click ([average CPC is $0.91](https://www.adbadger.com/blog/amazon-advertising-stats/#CPC)). Once you’ve determined your budget, calculate your maximum clicks per day and see if you’re happy with that number.


### Step 8: Review Campaign and Preview Before Going Live

After you’ve completed your ad campaign, you should preview it before actually going live with it. This way, you can spot any mistakes and fix them if necessary. Only once you’re satisfied with your campaign should you publish it.


### Step 9: Tracking Your Results

After your campaign has gone live, you should keep track of its performance using a set of metrics. Try to monitor the results periodically (e.g., weekly or monthly) so you can quickly discover any important trends.


### Step 10: Manage and Automate Ad Campaigns

Keeping track of metrics is great and all, but it means little if you can’t make changes to your campaign to improve results. Constantly monitoring your keyword bidding and ACOS can get really tiring, which is why it’s important to automate your ad campaigns with [Merch Jar](https://merchjar.com/).


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With Merch Jar, you can fully automate your bid management — we automatically raise or lower your bids to help you reach your target ACOS.



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We also automate your keyword isolation, removing low-performing keywords whilst promoting the highest-performing ones. We’re also continuously searching for new target keywords to save you trouble.



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## Conclusion

Amazon Ads are a great opportunity for authors to promote their work — especially for newer authors looking to self-publish. Their pay-per-click system makes advertising books quite cost-efficient, but it doesn’t end at just creating a campaign. In order to achieve continuous results, you need to optimize your campaign with [Merch Jar](https://merchjar.com/).

Here at Merch Jar, we strive to simplify your Amazon advertising through automation so you can focus on growing your business. [Sign up today](https://app.merchjar.com/register) to start optimizing your campaign management.


amazon-ads-for-authors-guide-and-tactics


Amazon is a _highly_ competitive marketplace. Every single day, around [3,700 new sellers](https://fitsmallbusiness.com/amazon-statistics/) join the platform and start competing for the attention of shoppers.

But don’t let that discourage you. With the right approach to Amazon Ads management, you can make your products stand out from the competition—earning visibility, orders, and profits.

In this [Merch Jar](https://merchjar.com) guide, we'll walk you through the fundamentals of Amazon ad management. We'll cover everything you need to know about setting up campaigns, tracking performance, and optimizing for success.

Let's dive in!


## What Is Amazon Ads Management?

Let’s start with a quick refresher—what is Amazon Ads management, and why should you care?

Amazon Ads management is the process of (you guessed it) managing Amazon PPC ads and ad campaigns. This usually involves a few related tasks, including:

- Identifying and optimizing keywords
- Setting up campaigns
- Setting campaign targets
- Monitoring performance
- Adjusting and optimizing bids 
- Testing, adjusting, and optimizing ad copies

All of this can be done manually via Amazon Seller Central, but there are also a variety of tools to automate the process.



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With automated Amazon Ads management tools like [Merch Jar](https://merchjar.com), you can save time and effort while ensuring that your campaigns remain up-to-date and perform optimally.


## Why Is Amazon Ads Management Important?


### Reduce Costs

A well-thought-out ad management strategy is one of the easiest ways to keep your costs down (while still hitting your targets).

It’s a matter of making small, targeted, fine-tuned adjustments based on real-time data rather than falling into the traps of over- and under-compensation. When you combine timely actions with reliable data, the result is lower ACOS and higher ROAS.


### Increase Visibility

Ads can make your products visible to the right customers, boosting your sales and increasing brand awareness. 

Targeting is at the core of Amazon Ads management—it ensures you reach out to the right audience with the right message at the right time. You can also test different ad types to determine which works best for your product.


### Stay Competitive

The simplest reason to take Amazon Ads management seriously? **Your competitors already do**.

According to the [2022 Amazon Annual Report](https://s2.q4cdn.com/299287126/files/doc_financials/2023/ar/Amazon-2022-Annual-Report.pdf), the company earned $37 _billion_ in ad revenue from 1.9 million active sellers last year—roughly $19,000 per seller. 

These sellers aren’t just blindly throwing money into Amazon’s accounts—they’re taking a strategic approach to Amazon Ads management that’s earning them a profit.


## Amazon Ads Management Best Practices


### Invest in Amazon Ads Management Tools

If you have a large product catalog or lack the time, skills, or resources to manage your campaigns, investing in an Amazon Ads management tool is the best move you can make.

[Merch Jar](https://merchjar.com) is designed to automate and streamline the process of managing Amazon ad campaigns at scale, with tools for:

- Smart bid optimization (in response to sales, ACOS, and clicks)
- Keyword promotion and negation
- Goal setting and tracking
- Detailed logs & analytics



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The result? You save countless hours in manual optimization while increasing revenue and shrinking your ACOS.


### Identify Your Advertising Goals

Want to run more effective Amazon Ads campaigns? Start with a clear goal in mind.

Generally speaking, there are four kinds of campaigns you can run:

- **Awareness**: “I want more people to recognize my brand.”
- **Consideration**: “I want customers to consider buying my products.”
- **Conversion**: “I want customers to buy my products.”
- **Loyalty**: “I want existing customers to keep buying from me.”

Once you know your goal, you can tailor your campaigns accordingly to maximize results.

This means using keywords that are relevant to the product and customer you’re targeting, setting bids according to traffic volumes, and adjusting spending limits as needed. Additionally, experiment with different ad formats, such as sponsored products or display ads. 



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Having a clear goal also helps you choose the metrics that will guide your success. For example, if you’re focused on conversions, you can define success in terms of sales, ROAS, and ACOS.


### Pay Attention to Ad Fatigue

Ad fatigue is a modern problem that can reduce the effectiveness of your campaigns. It occurs when customers are exposed to the same ads too often, and they start to ignore them.

To combat ad fatigue, tweak your creative periodically. Use different images and videos in your ads or change their copy for a fresh look. You can also experiment with new ad formats or audiences from time to time.

Also, make sure you’re paying attention to frequency—a metric that tracks how often customers are exposed to your ads. You want your target audience to see your ad _enough_, but not _too much_—a tough balance to strike. Aim for a [frequency of 5-20](https://www.klipfolio.com/metrics/marketing/ad-frequency/).


### Create Different Ad Groups for Keywords with Different Specificity

We’ll talk about how to create ad groups later on but know that you want to separate your keywords into different ad groups. Doing so will give you more precise control over the ads that are being shown for each keyword.

Here’s a simple example.

If you sell a range of men’s shoes, you can create a broad ad group containing everything from sneakers and hiking shoes for the very broad keyword “men's shoes”.



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Hiking shoes aren’t relevant for the keyword “men's running shoes”, though. So you’ll need to create a separate ad group for that.



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As you start creating these, you’ll start to realize that there are a ton of edge cases that you need to consider. For example, “men's athletic shoes” might encompass running shoes and track shoes.


### Run Retargeted Ads to Earn Conversions

Retargeting ads target users who have already interacted with your brand but haven’t made a purchase… yet.

They’re a powerful tool because you know that the user is already interested in what you’re selling. That makes them more likely to engage with your ad and eventually make a purchase.

By running retargeted ads, you can increase conversions by [as much as 150%](https://99firms.com/blog/retargeting-statistics/). It’s a great way to focus your ad spend where it’s most likely to yield a return.


## How to Create Amazon Advertising Campaigns in Seller Central


### 1. Go to Amazon Seller Central

Head over to [Seller Central](https://sellercentral.amazon.com/) and click the three-bar menu.



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Click “**Advertising**” and then open “**Campaign Manager**”.



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Click “**Create Campaign**”.



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### 2. Enter the Campaign Name

Next, give your campaign a name.



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Try to stick to a naming convention (e.g., “Retargeting Campaign October 2023”). This will make things _much_ easier down the line.


### 3. Select (or Create) a Portfolio

A Portfolio is a grouping of ad campaigns that allow you to set common budgets and other settings.



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Select the portfolio you want to use or create a new one if necessary. Potential grouping criteria include:

- Season
- Product category
- Business line


### 4. Set the Campaign Start and End Date

Pretty self-explanatory!



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### 5. Enter Your Daily Budget

Now it’s time to set a budget. 



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**Remember**—if you have multiple Portfolios, you’re setting a budget for each one. That means you’ll need a master budget to keep track of the total.


### 6. Choose Between Automatic Targeting or Manual Targeting

Automatic and manual targeting are two different approaches you can take to get your ads in front of searchers.



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- **Automatic targeting**: Amazon will automatically choose a selection of related keywords and products to target.
- **Manual targeting**: You create a list of keywords and products to target.

If you’re new to Amazon advertising, go with automatic targeting—you can always fine-tune your campaign later using a tool like Merch Jar’s Promotions. More experienced Amazon advertisers will probably fare better with manual targeting.


### 7. Set Your Campaign Bidding Strategy

There are three bidding strategies you’ll need to choose from:



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- **Dynamic** (down): Your bid may be lowered if a placement is less likely to result in a sale. 
- **Dynamic** (up & down): Your bid may be raised (by up to 100%) or lowered if a placement is more or less likely to result in a sale.
- **Fixed**: Your bid won’t change unless you make manual adjustments or use an automated bid optimization tool like Merch Jar.


### 8. Name the Ad Group

It’s time to give your ad group a name that will be easy to identify later. Try to make it descriptive and include the products or keywords you’re targeting for even more clarity.



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### 9. Select or Search from the List of Your Products

Now you’ll need to choose which products within the ad group you want to target. You can either select them from the list or search for specific ones.



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### 10. Set Your Bid

You’ve already picked your bidding strategy, now it’s time to set your bid.



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### 11. Choose Your Keywords

If you selected “Manual Targeting” earlier, now’s the time to add your keywords. The keywords you choose should accurately match the products or services you’re promoting.



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### 12. Click on “Save and Finish”

And you’re done! Just click “Save and Finish”.



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## Start Making the Most of Your Ad Spend

With average conversion rates [between 10% and 15%](https://influencermarketinghub.com/amazon-advertising-stats/), Amazon is an incredibly profitable platform for sellers who take the time to master Amazon Ads management. With a little practice and the right tools, you can become an Amazon Ads pro. 

Speaking of tools, [Merch Jar](https://merchjar.com) was designed to help sellers automate the tedious parts of Amazon Ads management. From bid optimization to keyword management, Merch Jar arms you with the tools you need to optimize your campaigns for success. 

Supercharge your Amazon Ads with a [30-day free trial](https://app.merchjar.com/register)!


the-ultimate-guide-to-amazon-ad-management


Like almost every aspect of running an Amazon business, effective advertising means carefully tracking, interpreting, and actioning key metrics.

Plenty of important Amazon advertising metrics exist, but we’ll leave those for another day. Instead, we’ll use this time to focus on one, especially critical metric—**Amazon ACOS**.

What is Amazon ACOS? Why does it matter? How can you improve it? In this guide, [Merch Jar](https://merchjar.com) will be answering all of these questions (and more).

Ready to make smarter Amazon advertising decisions? Read on.


## What Is Amazon ACOS?

ACOS (or “advertising cost of sales”) is a crucial metric across PPC advertising platforms—Amazon Ads included. 

Generally speaking, it tracks the cost-efficiency of your ad campaigns by comparing the amount of money you’re spending on ads to the revenue generated from that ad spend.


## How To Calculate Amazon ACOS

To calculate Amazon ACOS, all you need to do is divide the total advertising cost for a given period by the total sales generated during that same period—then multiply the result by 100.

- ACOS = ad spend ÷ sales generated x 100

Let’s say you had $25 in ad spend, resulting in $100 of sales revenue over a week-long period. Divide $25 (ad spend) by $100 (sales revenue), and you get 0.25—multiply that by 100, and you have your ACOS of 25%.

To put that _another_ way, you spent 25¢ for every $1 of sales revenue.


### ACOS vs. ROAS

If the definition of ACOS sounds similar to ROAS (or “return on ad spend”)… well, there’s a good reason for that. ROAS is just the inverse of ACOS—and vice versa. You calculate ROAS by dividing total sales by ad spend for a given period to land on a ratio.

- ROAS = sales generated ÷ ad spend

In the above example, a 25% ACOS indicates that you achieved a ROAS of 4:1 ($100 in sales to $25 in ad spend). In other words, you made $4 for every $1 you invested in advertising—not bad!


### ACOS vs. Break-Even ACOS

Break-even ACOS is a related metric that tells you how much you can spend on advertising while still turning a profit. To calculate it, start by calculating your gross profit margin for the product in question. Then… actually, that’s the only step—your gross profit margin is _also_ your break-even ACOS.

- Gross Profit Margin = (revenue – COGS) ÷ revenue x 100%

Continuing the example from above, let’s say you’ve recorded a COGS of $60 over for the same week-long period you recorded $100 in sales revenue and $25 in ad spend. Well, your gross profit margin would be ($100 – $60) ÷ $100 x 100% for a total of 40%.

That means you’ll still be turning a profit as long as you keep your ACOS _below_ 40%.


## Why Is ACOS Important for Amazon Sellers?

Amazon ACOS shouldn’t be the only metric you track—there are plenty of other important ones out there. Still, ACOS is a key piece of the Amazon ad management puzzle for several reasons:


### Measure the Effectiveness of Ad Campaigns

Effective ads and well-targeted campaigns are cost-effective—they drive more sales volume without increasing your advertising costs. As a result, ACOS is a quick and easy way to measure the effectiveness of your campaigns and compare their performance.


### Simplify Bid Management

ACOS thresholds and targets are a simple (but effective) way to manage your bidding in a way that balances visibility with profitability.

With a tool like [Merch Jar](https://merchjar.com), you can set [target ACOS thresholds](https://merchjar.com/learn/choosing-your-ideal-target-acos) for your products based on niche and gross profit margin. Then, your bids will automatically be adjusted to approach that target—guaranteeing you the best return on your ad spend.


## What Is a Good Amazon ACOS?

Unfortunately, there isn’t one simple benchmark for ACOS on Amazon. You _can_ work out an ideal target ACOS, though. 

Your ideal target ACOS is always somewhere in the range of 0 to whatever your break-even ACOS is—but how do you choose it?

Start by thinking about what you want to achieve with your ad campaign. If your goal is increased sales and visibility, set a higher target ACOS (closer to break-even ACOS). If your goal is profitability, set a lower target ACOS (closer to 0).


## How To Improve Your Amazon ACOS


### 1. Target the Right Keywords

Amazon is a search engine—just like Google. Generating sales through your ads is a matter of targeting the right people with the right keywords.

What does that look like in practice? Well, for starters, you’re going to want 50 – 60 keywords per ad group (out of the 1,000 allowed by Amazon). This range will make optimizing your campaign within a reasonable timeframe possible.



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There are a few methods you can use to find your starting keywords, but the most reliable is using a keyword research tool like [Keyword Tool](https://keywordtool.io) or [Ahrefs](https://ahrefs.com/amazon-keyword-tool). Just enter a seed word and you can generate a list of hundreds of related keywords (complete with SEO metrics).



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Once you’ve launched your campaign with your initial list, you’ll start to generate data that you can use to optimize your keyword list. Merch Jar gives you access to all of this data through the Search Term view so that you can easily see which keywords are performing well—and which aren’t.


### 2. Work On Keyword Isolation

Speaking of keyword optimization—keyword isolation is the process of pruning the keywords used in a campaign so that high-converting keywords get a higher percentage of your ad spend (i.e., higher bids).

There are two ways to do this:

- Promote high-converting keywords.
- Negate low-performing keywords.

With Merch Jar’s [Promotions](https://merchjar.com/features/promotions) feature, this process is entirely automated—and entirely configurable. You can set complex, multistep rules for promoting and negating keywords, ensuring that you always get the most out of your ad spend.



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Rules are based on conditional statements and can account for a range of metrics, from ACOS to clicks to orders. You can also automatically increase or decrease bids for newly promoted or negated keywords to maximize the impact on your ACOS.


### 3. Optimize Your Titles

The title of your product list is one of the first things people are looking at when they’re served your ad—you need to make a good first impression!



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To do this, there are a few simple best practices to stick to:

- Open with the brand or manufacturer (e.g., “SteelSeries”)
- Stick to around 80 characters (and _never_ exceed 200).
- Use title casing.
- Use numerals when writing numbers (e.g., “9” not “Nine”).
- Separate information with commas, hyphens (-), or slashes (/).
- Use keywords relevant to the products you offer (e.g., “for PC” and “for PS5”).


### 4. Optimize Page Content

Getting people to click on your ads is one thing—getting them to place an order is another thing entirely. If you want to improve your ACOS, you need to create high-converting product pages that reliably win sales.

How? There are a few simple optimizations you can make for quick results:


#### Photos

- Use a white background for your main product photo.



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- Show the size of the item in at least one photo.



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- Show the item in use in at least one photo.



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- Show the item’s packaging in at least one photo.



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#### Features

- Use a wide range of relevant keywords.
- Avoid keyword stuffing (keyword density is _not_ a ranking factor).
- Put feature bullets in order of importance.
- Help readers envision themselves using the product.
- Link benefits to features.


### 5. Set the Right Bid Amount

Smart bidding is one of the most influential ways to bring down your ACOS. By bidding _juuust_ enough to get the results you want, you can maximize revenue while keeping your costs manageable.

Merch Jar makes this process easier with the fully automated [Smart Bids](https://merchjar.com/features/smart-bids) feature. With 24/7 monitoring and intelligent constraints, the Merch Jar algorithm is always optimizing your campaigns to ensure maximum efficiency.



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Worried about massive bid swings? Don’t be—with Merch Jar, you can set maximum bid adjustments so that your bids help you inch toward your targets rather than wildly shooting up or down.


### 6. Focus on the Right Metrics

ACOS is an important metric—but focusing on ACOS alone won’t help you improve it. You should also track other metrics, like:

- Impressions
- Clicks
- CTR (click-through rate)
- Conversions
- Conversion rate
- Revenue

For example, Amazon conversion rate optimization (CRO) through techniques like [A/B testing](https://sell.amazon.com/blog/grow-your-business/manage-your-experiments) product images and titles is one of the most effective ways to decrease your ACOS.



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When you’re able to convert a greater percentage of the people who land on your page, you’re more likely to drive down your ACOS and increase your profitability.


## Put Amazon Advertising on Autopilot

Advertising on Amazon is a constant balancing act. You need to spend to gain visibility, clicks, and order—but spend too much and you’ll end up with a lower ROI. ACOS is a powerful metric that helps you tailor your ad spend to the results you’re looking for.

Tired of endless manual adjustments? [Merch Jar](https://merchjar.com) can help.

Merch Jar is a platform designed to arm Amazon sellers with all the tools and automation they need to put d management on autopilot. From keyword targeting to bid optimizations, Merch Jar can help you get the most out of your Amazon advertising.

[Get started with a free trial](https://app.merchjar.com/register) and see for yourself!


how-to-track-amazon-acos-plus-best-practices


Amazon is obviously a well-known platform for buying and selling alike. But did you know that they also offer a print-on-demand service called Merch by Amazon (MBA)?

Well, by the end of this [Merch Jar](https://merchjar.com) guide, you’ll know everything you need to about Merch by Amazon and how to join.

Ready to diversify your revenue streams? Let’s get started.


## What Is Merch by Amazon?

[Amazon Merch on Demand](https://merch.amazon.com/landing) (more commonly referred to as “Merch by Amazon”) is a print-on-demand service offered by—you guessed it—Amazon. It allows sellers to sell custom merchandise without investing money upfront for manufacturing and warehousing.

How? The process is pretty simple.

When you join the Merch by Amazon program as a seller, you upload designs and choose the products you’d like to sell from a preset list. When a customer places an order, Amazon handles the entire fulfillment process—from printing to delivery to customer service.

For every sale, you earn a royalty (usually 10-40% of the purchase price) for your work creating and marketing the product.

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Take a look at the example above—it looks no different from a standard Amazon listing, but this is an _MBA_ listing. For every sale, this simple, text-based design is generating around $2 in profit for the MBA seller who uploaded it—no inventory required.

Multiply that by hundreds (maybe thousands) of designs and you have a highly profitable business with virtually no overhead.


## Why Join Merch by Amazon?

The print-on-demand business model is popular for a reason (well, a few, actually). Let’s take a look at some of the benefits of Merch by Amazon:


### Industry-Leading Infrastructure

Amazon is pretty clearly leading the pack when it comes to ecommerce infrastructure. If you live in a city, there’s a good chance you can get next-day (or even same-day) delivery from Amazon. 

With Merch by Amazon, you can reap the benefits of this infrastructure without having to manage your own inventory or shipping operations.


### Low Investment & Risk

One of the main advantages of print-on-demand is that you don’t need to make a large up-front investment in products before you know how many you’ll sell (or if you’ll sell any at all). That removes the main obstacle stopping designers, creators, and businesses from creating merch in the first place.


### Huge Earnings Potential

You don’t need me to tell you that tons of people use Amazon—but I’m going to anyway!

The platform has over [2.45 billion monthly active users](https://www.zippia.com/advice/amazon-statistics/#:~:text=Amazon%20Statistics%20by%20Amazon%20Shoppers&text=Well%2C%20according%20to%20our%20research,885%20million%20visits%20per%20month.) and processes around [$50 billion in sales each month](https://www.statista.com/statistics/273963/quarterly-revenue-of-amazoncom/). With the right designs and an [optimized Amazon ad strategy](https://merchjar.com/learn/4-amazon-ad-optimization-to-make-every-week), you’re able to leverage the massive scale of Amazon’s customer base to make sales.

Combine that with Merch by Amazon’s generous royalties (more on those later) are you’re looking at some solid earnings potential!


## Who Should Join Merch by Amazon?

Anyone with a design (that they own the commercial rights to) can join Merch by Amazon and start selling. That said, the program will mainly appeal to:

- Designers & artists
- Influencers, content creators & public figures
- Remote entrepreneurs & small businesses
- Events & non-profit organizations


## Merch by Amazon Royalties

Merch by Amazon royalties are the percentage of the sales price that goes into your bank account after Amazon subtracts its expenses (i.e., picking, packing, delivery, etc.). They vary based on two factors:

- The product you’re selling.
- The price you set (higher prices mean higher royalties).

Your royalties will likely fall somewhere in the 13-37% range.

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To see this variation in action, compare the royalty for selling a $15.99 t-shirt ($1.93) with a $25.99 t-shirt ($9.32). The former is a 13.8% royalty, while the latter is a 37.6% royalty.

The lesson? Selling premium designs is usually the way to go.


## Merch by Amazon Tiers

Merch by Amazon uses a tier system to prevent a flood of low-quality designs from flooding the platform. It’s pretty intuitive—the more sales you make, the higher your tier. The higher your tier, the more designs you’re able to create. 

There are currently eight publically listed tiers (plus a bunch of higher, unlisted tiers):

- **Tier 1**: 10 designs—this is the starting tier.
- **Tier 2**: 25 designs.
- **Tier 3**: 100 designs.
- **Tier 4**: 500 designs.
- **Tier 5**: 1,000 designs.
- **Tier 6**: 2,000 designs.
- **Tier 7**: 4,000 designs.
- **Tier 8**: 8,000 designs.

To move up a tier, you need to make a number of sales equal to your current tier’s design allowance and use at least 80% of that allowance. So, if you’re currently Tier 1 and make 10 sales with 8-10 designs—congratulations! You’ve qualified for Tier 2.


## Merch by Amazon Products

So, what products can you add your designs to? Here’s the full list along with the size requirements for the artwork:


### 4,500px by 5,400px

<Image
  src="/images/blog/merch-by-amazon-mba-insider-best-practices-you-must-know-about/mba-sizes.png"
  layout="responsive"
  width={1111}
  height={188}
/>

- T-shirts – front and back
- Women's v-neck t-shirts – front and back
- Raglans – front and back
- Tank tops – front and back
- Long sleeve t-shirts – front and back
- Crew neck sweatshirts – front and back
- Pullover & zip hoodie – back


### 4,500px by 4,050px

<Image
  src="/images/blog/merch-by-amazon-mba-insider-best-practices-you-must-know-about/mba-hoodies.png"
  layout="responsive"
  width={1111}
  height={188}
/>

- Pullover & zip hoodies – front


### 485px by 485px

<Image
  src="/images/blog/merch-by-amazon-mba-insider-best-practices-you-must-know-about/mba-popsockets.png"
  layout="responsive"
  width={1111}
  height={188}
/>

- PopSockets grips


### 1,800px by 3,200px

<Image
  src="/images/blog/merch-by-amazon-mba-insider-best-practices-you-must-know-about/mba-phone-cases.png"
  layout="responsive"
  width={1111}
  height={188}
/>

- iPhone & Samsung phone cases


### 2,925px by 2,925px

<Image
  src="/images/blog/merch-by-amazon-mba-insider-best-practices-you-must-know-about/mba-tote-bags-and-pillows.png"
  layout="responsive"
  width={1111}
  height={188}
/>

- Tote bag
- Throw pillow

Each product comes in a range of colors and (where applicable) sizes.


## How To Sign Up for Merch by Amazon


### 1. Fulfill the Requirements

When I say anyone can start selling through Merch by Amazon, I mean it—the requirements for signing up are super relaxed.

All you’ll need is:

1. A valid bank account (i.e., account & routing number).
2. Proof of identity (i.e., SSN or TIN).

That’s it! If you can provide those two things, you should be good to go.

That said, you’ll probably also want to choose a design tool like Canva, Photoshop, Illustrator, or Adobe Spark to create your designs. A professional design tool will help you create products that people want to pay for.


### 2. Go to Merch By Amazon’s Landing Page

The next step is heading over to the [Merch by Amazon landing page](https://merch.amazon.com/landing) to get started with your application to join the program.

<Image
  src="/images/blog/merch-by-amazon-mba-insider-best-practices-you-must-know-about/mba-signup.png"
  layout="responsive"
  width={1111}
  height={188}
/>

### 3. Log Into (or Create) an Amazon Account

Next, you’re going to want to either log in or create an Amazon account to start your application. You don’t need an Amazon Seller Account for this—a normal Amazon account is fine.

What are the benefits of creating a new account?

Having a separate account for Merch by Amazon might help you keep things organized down the line—especially if you’re a regular Amazon user who’s constantly getting emails and notifications already.


### 4. Fill Out the Application Form

<Image
  src="/images/blog/merch-by-amazon-mba-insider-best-practices-you-must-know-about/mba-application.png"
  layout="responsive"
  width={1111}
  height={188}
/>

Finally, it’s time to fill in the application! There are three sections you’ll need to complete:

- My Profile: Here you’ll be asked for basic business info (i.e., business name, address, and contact info).
- Payment & Banking: Here you’ll be asked for your business’s bank details.
- Tax Information: This is where you’ll need to provide your tax info. Be sure to have all the required documents ready.

Once you’ve filled out these three sections, you’ll see a final, fourth section. Here, you’ll give the Merch by Amazon review team extra information to support your application—including websites and motivations.


### 5. Submit the Application

Hit “Submit” and you’re done!

Note: MBA is a very popular program. Anyone is free to fill in an application, but you may not hear back for a while!


## Merch by Amazon Best Practices


### Capitalize on Trends

Chasing trends is a great way to create merch that people actually want to buy. Memes, notable people, events, cultural movements, Twitter jokes—all of these trends can be used to create unique designs.

However, it’s important to make sure you don’t infringe on any protected material. Do your research to make sure your designs are original.

Merch Informer is a great tool for identifying profitable trends on Amazon. It gives you access to tons of data about searches, sales, and trends to analyze for opportunities. For example, you can enter any keyword and see a list of the best-selling merch that matches, along with price and rank trends.

<Image
  src="/images/blog/merch-by-amazon-mba-insider-best-practices-you-must-know-about/merch-informer.png"
  layout="responsive"
  width={1111}
  height={188}
/>


### Use a Powerful Tool to Advertise Your Listings

<Image
  src="/images/blog/merch-by-amazon-mba-insider-best-practices-you-must-know-about/merch-jar-analytics.png"
  layout="responsive"
  width={1111}
  height={188}
/>

Success as a Merch by Amazon seller is all about effective ad management. And while you can do this manually, it’s easier (and more profitable) with a tool like [Merch Jar](https://merchjar.com).

Merch Jar combines keyword research, bid management, analytics, and other features into a single powerful interface for Amazon sellers.

With Merch Jar, you can:

- Analyze search trends to find high- (and low-) performing keywords.
- Automatically adjust bids for optimal clicks, orders, and ACOS.
- Automatically promote or negate keywords.
- Track key ad metrics in real-time.

By taking advantage of these advanced advertising techniques, you’ll be able to maximize your success as a Merch by Amazon seller. So don’t wait—get started with Merch Jar for free today!


### Start with Multiple Channels

Merch with Amazon is one of many print-on-demand services. While you work your way up the tiers, you’ll want to explore other channels to get around Amazon’s design limitations.

There are plenty of great options, including:

- [Printful + Etsy](https://merchinformer.com/printful-etsy-integration-ultimate-guide/)
- [Redbubble](https://www.redbubble.com/)
- [Teespring](https://teespring.com/)
- [Zazzle](https://www.zazzle.com/)
- [TeePublic](https://www.teepublic.com/)
- [Spreadshirt](https://www.spreadshirt.com/)
- [SunFrog](https://www.sunfrog.com/)

Create 60–90 designs and upload them to each platform. That way, you can have a sizable portfolio of products to drive more traffic and sales.

A tool like Merch Informer can help here, by allowing you to upload designs to multiple marketplaces from a single dashboard.


## Merch by Amazon Dos and Don’ts


### Do

- Think about the size, shape, and color of the products you’re designing for.
- Create unique designs that stand out from the competition.
- Choose quality images and fonts.
- Read up on the [Content Policy](https://merch.amazon.com/resource/201858630) section before designing.


### Don't

- Add elements with transparency >20%.
- Use premium images or fonts without permission.
- Add cutting lines on the edges of your art.
- Include any logos, trademarks, or copyrighted material without permission.

These tips will help you create merch with the best chances for success.


## Simplify Merch by Amazon Ad Management with Merch Jar

Merch by Amazon is a potentially lucrative way to make money online, but managing your ads can be a time-consuming and confusing task. [Merch Jar](https://merchjar.com) makes it easy. 

With Merch Jar, you can save time by quickly setting up ads for all of your products at once. The system will also auto-optimize campaigns based on performance data to ensure that your ads reach their maximum potential.

[Try Merch Jar for free](https://app.merchjar.com/register) today and start seeing results!


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