Step-by-Step Understand Amazon Sponsored Ads Targeting

Did you know that more than 70% of Amazon shoppers never click past the first page of search results? That means where and how your ads appear can directly decide whether your product gets noticed—or buried. With Amazon ads accounting for nearly $47 billion in revenue in 2024, competition for visibility has never been tougher.

For advertisers, this makes choosing the right bidding strategy and targeting method critical. A well-structured Sponsored Products campaign doesn’t just put your listings in front of more shoppers; it ensures that your budget is spent on clicks most likely to convert. Whether you’re using automatic targeting to let Amazon’s algorithm do the work, or manual targeting to fine-tune your reach, understanding the nuances of bidding features can make the difference between wasted spend and profitable growth.

In this guide, we’ll break down your options, from automatic and manual targeting to negative keyword strategies, and explain how to use Amazon’s Search Term Report to identify opportunities for optimization.

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Types of Amazon Ads Targeting

When running ads on Amazon, targeting decides whether your ad shows up in front of your dream customer—or someone who will never buy. Amazon offers two main approaches: automatic targeting and manual targeting.

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Automatic Targeting Campaigns

With automatic targeting, you let Amazon’s algorithm take the driver’s seat. Amazon analyzes your product listing, including title, bullet points, description, backend keywords and matches it to customer searches. You can:

Set one default bid for all targeting types, or

Set separate bids for each targeting group: Close match, Loose match, Substitutes, and Complements. 

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The Four Targeting Types in Automatic Campaigns

Close Match
Your ads appear when shoppers search for terms closely related to your product.
Example: Selling “wireless earbuds” → Your ad may show for “Bluetooth earbuds.”

Loose Match
Your ads appear on loosely related search terms.
Example: Selling “wireless earbuds” → Your ad may show for “headphones.”

Substitutes
Your ads appear on product detail pages of similar items.
Example: Selling “wireless earbuds” → Your ad could show on a competitor’s earbud listing.

Complements
Your ads appear on products often bought together with yours.
Example: Selling “wireless earbuds” → Your ad could appear on a smartphone listing.

We recommend the second option for more control. You can also refer to Amazon’s suggested bid for each group. Learn more in our step-by-step guide to automatic targeting.

Manual Targeting Campaigns

Manual targeting gives you full control over when and where your ads appear. Unlike automatic campaigns, you choose exact search terms, products, or categories to target. This strategy is ideal for advertisers who want precision and the ability to optimize bids based on performance data.

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Manual Keyword Targeting

With manual keyword targeting, you decide exactly which search terms trigger your ads. Amazon offers three match types:

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‍Broad Match: Your ad shows for searches containing your keyword in any order, including synonyms and variations.
Example: A keyword like “wireless earbuds” could trigger ads for “Bluetooth headphones” or “cheap wireless earbuds.” This option is great for expanding reach and discovering new keyword variations but may bring less precise traffic.

‍Phrase Match: Ads appear for searches that contain your keyword phrase in the correct order, with additional words before or after.
Example: “Wireless earbuds” could trigger ads for “wireless earbuds for gym” or “buy wireless earbuds online.” Phrase match balances reach and relevance.

‍Exact Match: Ads only appear for your exact keyword or close variations, making this the most precise and performance-focused option.
Example: “Wireless earbuds” will only trigger for “wireless earbuds.”

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Manual Product Targeting

Instead of keywords, manual product targeting allows you to place your ads directly on specific product detail pages or across entire categories. This approach is highly effective for competitor targeting and cross-selling opportunities.

Competitor Product Targeting: Target competitor listings, especially if your product has a lower price, better reviews, or superior features.

Complementary Product Targeting: Place ads on products frequently bought together with yours. For example, sellers of laptop stands can target laptop listings.

Category-Level Targeting: Cast a wider net by targeting a whole category, such as “Sports & Outdoors > Hydration” for water bottles. Over time, refine by excluding underperforming ASINs.

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Negative Keywords: Your Ad’s Best Defense

Negative keywords help prevent your ads from showing on irrelevant searches, saving budget and improving campaign performance.

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What Are Negative Keywords?

Negative keywords act as filters. For example, if you sell leather wallets, adding “free” as a negative keyword prevents your ad from appearing for searches like “free wallet.” To learn more about how negative keywords work and how to use them effectively, check out our detailed guide on negative keywords.

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Types of Negative Keywords

• Exact Match Negative: Blocks only one specific search term.
• Phrase Match Negative: Blocks all searches containing the exact phrase.
  
  

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How to Identify Negative Keywords in Amazon Ads on Search Term Report?

Negative keywords are essential for preventing your Amazon ads from showing to irrelevant searches, reducing wasted spend, and improving campaign performance. The most effective way to identify them is by analyzing Amazon’s Search Term Report, which provides detailed metrics on how specific keywords perform.

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Access the Search Term Report

To access the report, go to Amazon Seller Central or Advertising Console. Navigate to the “Advertising” or “Campaign Manager” section, select the ad campaign you want to analyze, and download the corresponding report. 

The report includes important metrics:

• Impressions: Number of times your ad appeared for a given search.
• Clicks: How many times the ad was clicked after appearing for that term.
• CTR (Click-Through Rate): Clicks divided by impressions, showing engagement level.
• CPC (Cost-Per-Click): Average cost paid for each click from the term.
• Ad Spend: Total spend on clicks from the search term.
• Orders/Sales: Number or value of purchases generated by that search term.
• Conversion Rate: Rate of ad clicks that resulted in orders.
• ACoS: Advertising Cost of Sales—Ad spend divided by sales; a lower value means better efficiency.
• New-to-Brand (NTB) Sales: For Sponsored Brands, counts first-time buyers from a term.
• Search Frequency Rank: Shows how popular a term is relative to others ASINs: The products that received traffic or sales from a search term (for Brand Analytics or Targeting Reports).

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Identify Negative Keywords Using Key Metrics

Start by looking for keywords that consume a significant portion of your budget but result in few or no conversions. These high-spend, low-conversion keywords are prime candidates for negative keywords.

Next, consider keywords with a high click-through rate (CTR) but low conversion rate. While these keywords attract clicks, they fail to convert visitors into customers, suggesting that the traffic they drive is not well-aligned with your product or target audience.

Keywords that result in a high cost per conversion are also worth reviewing. Even if they generate some sales, they may not be cost-effective, and adding them as negative keywords can help improve overall campaign efficiency.

Finally, pay attention to relevance. Keywords that appear related to the search term but do not fit your product or target audience, such as overly broad terms, should also be considered for negative keyword lists.

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Monitor and Update Negative Keywords

After identifying negative keywords, it is important to track search trends and customer behavior continuously. Regularly review your search term reports to uncover new negative keyword opportunities, adjust for seasonal trends, and ensure that your campaigns remain optimized for ROI without unnecessarily restricting impressions.

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FAQ

1. What is the difference between automatic and manual targeting?

Automatic targeting lets Amazon decide where your ads appear, based on relevance to customer searches. Manual targeting gives you full control over which keywords, products, or categories trigger your ads.

2. Should I use both keyword and product targeting?

Yes. Keyword targeting focuses on search intent, while product targeting reaches shoppers browsing related or complementary items. Using both together maximizes reach and sales opportunities.

3. How often should I update negative keywords?

Weekly updates are ideal. Regularly reviewing and adding negative keywords prevents wasted spend on irrelevant searches.

4. Can negative keywords hurt performance if used incorrectly?

Yes. Adding too many negative keywords may block relevant traffic. Always review carefully before applying them.

5. What’s the best way to optimize a manual targeting campaign?

Use a mix of match types, monitor campaign reports regularly, add negative keywords strategically, and adjust bids based on performance data.