Amazon PPC bid optimization: bid from profit, not one ACoS
Most sellers, and most bid tools, aim every keyword at one ACoS. But each product keeps a different share of its price after Amazon's fees and its landed cost, so one target is too timid for some products and loses money on others. Here is how to set every bid from the product's own margin, step by step, with the arithmetic worked through.
Why one ACoS target fails
Take two products in the same account, both advertised at a 30% ACoS target:
| Product | Price | Profit before ads | Breakeven ACoS | At a 30% ACoS |
|---|---|---|---|---|
| Product A | $29.99 | $12.00 | 40.0% | Profitable, but bidding below what a click is worth |
| Product B | $24.99 | $4.50 | 18.0% | Every ad sale loses money |
Product A could bid more and still make money; product B loses money on every sale its ads bring in. Nothing about the ads tells you that: only the margin does.
Step 1: each product's breakeven ACoS
Breakeven ACoS = profit before ads ÷ selling price. Profit before ads is the price minus everything a sale costs except advertising: Amazon's referral and FBA fees, the landed cost of the unit (product, freight, duty), and an allowance for refunds and storage. At that ACoS an ad sale makes exactly $0. Use what the product actually earned over the last month or two, not the price list: promotions, fee changes and a new batch's cost all move it. The FBA profit calculator works out profit before ads for one unit.
Step 2: the target
Target ACoS = breakeven ACoS − the profit you want to keep, in points of the price. With a 35% breakeven and 10 points kept, the target is 25%: every ad sale still leaves 10% of the price as profit. The ACoS calculator works out both.
Step 3: the bid a click is worth
What a click is worth to you is its sales per click × your target ACoS. Amazon usually charges less than your bid, so compare that with what a click costs now, and scale the bid by the difference:
New bid = bid now × (sales per click × target ACoS) ÷ cost per click
A worked example: an exact-match keyword bid at $1.20, for a product with a 35.0% breakeven and 10 points kept (a 25.0% target). Over the last 30 days it had 80 clicks, $76.00 of spend and 6 orders worth $179.94.
- ACoS = $76.00 ÷ $179.94 = 42.2%, over the 25.0% target.
- Sales per click = $179.94 ÷ 80 = $2.25; a click is worth $2.25 × 25.0% = $0.56.
- Cost per click = $76.00 ÷ 80 = $0.95.
- New bid = $1.20 × $0.56 ÷ $0.95 = $0.71.
- That's a big cut, so take it in steps of at most 20%: $1.20 → $0.96 this week, then judge it again on the new numbers.
Raising works the same way: a keyword well under its target is worth more per click than it costs, and its bid goes up a step. But only move a bid the way its own ACoS points: never raise a keyword that is over target.
Few clicks: don't trust one sale
- Wait for about 10 clicks before judging a keyword on its sales. Below that, one sale makes a keyword look brilliant and none makes it look hopeless.
- For keywords with some clicks but not many, lean on the ad group's sales per click: blend the keyword's numbers with the ad group's as if it had a few more clicks at the ad group's rate.
- The exception: a keyword that has already spent, without a sale, more than your target ACoS would allow for one and a half sales should come down a step, however few clicks it has.
Step 4: placements
Every campaign has bid increases for top of search, rest of search and product pages. A click there is worth a different amount, so bid in proportion to sales per click: the placement that sells least a click runs on the base bid, the others get their sales per click over that one's, less one, as a percentage. In this example campaign:
| Placement | Clicks | Sales | Sales a click | Increase |
|---|---|---|---|---|
| Top of search | 420 | $3,780.00 | $9.00 | +100% |
| Rest of search | 610 | $3,660.00 | $6.00 | +33% |
| Product pages | 380 | $1,710.00 | $4.50 | 0% (base bid) |
The placement bid calculator works it out for your own campaigns. Set the placements first, then the keyword bids: the keywords then set the level from the campaign's blended numbers.
Step 5: stock
- Running low: if your stock (including units on their way to Amazon) won't last until a restock arrives, organic sales alone may sell it out. Ad spend then only brings the stockout closer: lower the target in proportion and don't raise any bids. Selling slower also keeps you above the 28 days of supply where Amazon charges its low-inventory-level fee.
- Overstocked: past 22 weeks of stock, Amazon's storage utilization surcharge starts. Keeping less profit per ad sale to sell the stock down can cost less than storing it.
- Out of stock: Amazon stops showing the ads; leave the bids alone until it's back.
Automatic campaigns and product targets
An automatic campaign has four targeting groups: close match, loose match, substitutes and complements. Each sells differently, so bid each on its own numbers rather than moving the ad group's default bid for all four. Product targets (a competitor's ASIN, a category with a price or rating range) are bid like keywords, from their own clicks and sales.
How often
- Judge the last 30 days, leaving out the last two: Amazon keeps adding sales to a click for 7 days.
- Change a bid at most once a week, by at most a fifth, and wait for the new numbers before the next step.
- Recheck the targets when a cost or fee changes: a supplier's price rise lowers the breakeven without the ads changing at all.
Doing it for every keyword, every day
The method is simple; the work is in doing it for hundreds of keywords, targets and placements, every week, with each product's current margin. MyProfit's profit autopilot does exactly this from your own data: breakeven ACoS per product from your landed costs and the fees Amazon actually charged, bids for keywords, product targets and automatic targeting groups, placement increases, and stock. On Recommend it lists the changes with the numbers behind them and you approve each one, which also makes it a second opinion if an agency runs your ads; on Automatic it applies them every day. See it in the sample store, on made-up numbers.
Amazon's 7-day attribution for Sponsored Products, placement increases from 0% to 900%, the storage utilization surcharge from 22 weeks of supply and the low-inventory-level fee under 28 days come from Amazon's advertising and Seller Central help pages, read in October 2026. The products and campaign above are examples.
Set every bid from your products' real profit
MyProfit pulls your orders, fees, settlements, returns and ad spend from Amazon every night and shows your real profit by product, day and payout. 30 days of everything free, then $19.99 a month, or keep the free plan: it finds the money Amazon still owes you and checks your FBA fees, for good.