What Is The Average Cost Per Click On Amazon? Sales Funnel HQ
Part of setting up a successful Amazon Sponsored Products campaign is knowing what you should pay for your PPC ads. If you know the average cost per click on Amazon for your desired product category, you can begin to start planning your campaigns and setting yourself up for success. Just make sure that you are aware of the many variables that come into creating advertisements on Amazon.
Don’t rush into the process of creating your own Amazon Sponsored Products advertisements because there are a few things that you need to be aware of. On this page, we will break down the average cost per click on Amazon advertisements and all the various means you can use the system to your advantage and start profiting today.
What is The Average Cost Per Click on Amazon?
Answering a question like this isn’t entirely easy since each product niche and category may produce an entirely different answer.
Think of things this way. You run a hot dog business and like to sell hot dogs for $1 each. Your hot dogs soon become popular to the point where there is a line outside of your hot dog stand.
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As a result, you do a little experiment. You raise your prices up to $2 for each hot dog. Then, you lose many of your customers which were waiting in line. However, you end up making more money for the day. The reason for this is simple. You discovered that there is a demand for your service, and adjusted the price up to a point where people are willing to pay for it without lining up for miles. Amazon also works in a similar manner with their advertisements.
The Short Answer
Remembering that the average cost per click on Amazon can change over time, a general price range which has been consistently measured and recorded is anywhere between $0.28 to $0.80. However, in order to understand this data, you will need an understanding of how the Amazon PPC system works.
Right off the bat, it’s important to know that the type of product you wish to sell and its corresponding category all have an effect on the average cost per click. Certain niches are more competitive than others. In niches with more competition, the bids tend to be higher than those which are less popular.
Why Use Amazon Sponsored Products Campaigns?
Using Amazon Sponsored Products for advertising your product listing can turn into a rather lucrative venture if you know what you are doing. However, it is the lack of background knowledge and those who act without thinking that can commonly cause failure on this platform. Do not worry, though. With the right pieces of information, you can use Amazon advertisements like a pro.
Huge Platform for Exposure
Perhaps the most obvious reason for which you want to use Amazon advertisements is the fact that the platform itself is the largest online sales platform in the world. This means that more people use Amazon to sell their products than any other platform. Understandably, this can create a lot of competition, and accordingly, uncertainty about your potential for success on the platform.
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Think of things like this. As a salesman, it is your job to find the means by which you will generate clients and more sales. You simply cannot expect your customers to search for you until you have an established brand and reputation. With Amazon, you can take a budding brand and advertise it to the world on the same platform that any industry giants in your category likely use. Talk about leveling the playing field.
Reasonably Priced Campaign Options
Of course, most people don’t have an unlimited budget to work with as they calculate the average cost per click on Amazon ads. In fact, those who are concerned with the average cost per click Amazon charges in the first place are likely the ones who need to carefully plan their campaign strategies. Since even the slightest failure can cause significant levels of disappointment, it’s important that you put in as much effort as possible to understand the system.
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After all, the system isn’t going to give you a free pass just because you are a new user. In fact, you will be expected to create advertisements at the same level as some of the industry giants in your category. Thankfully, the prices for campaigns depend on your personal budget. In other words, your definition of an affordable campaign is exactly what you will receive at Amazon. Even the average cost per click Amazon ads charge will be dependent on your daily budget.
The Potential for a Huge ROI
As we have made clear, there is a large platform available with Amazon. Best of all, it is a platform that just about anybody can afford if they want to place an advertisement to help sell a product. Since both of these factors are present, the ability for one to take their investment and flip it around to receive a healthy return is very likely and possible for those who put in the effort.
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Setting up product pages, finding contacts for production and shipping, creating advertisements, and all the factors that go into being a successful Amazon seller are not easy. However, anybody who puts in the work to learn the system and how to use it to their advantage will soon change from being a beginner salesman with a moderate stroke of success into a salesman who consistently drives in big returns on their advertisement investments.
How Does the Amazon Pay Per Click Bidding Work?
Understanding the average cost per click Amazon uses for their products also requires you to have a healthy understanding of how the PPC system itself works. For starters, the PPC system allows Amazon to gauge how much or how little sellers are willing to spend on their advertisements. Once a handful of people comfortably list the amount they can spend on an advertisement, the system starts to notice trends.
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As more and more people bid on the same keywords in the same categories, the competitiveness of that category also increases. After all, there are more people attempting to place an ad in it. As a result, categories like this may have an average cost per click Amazon lists higher than those with less competition and bidding. In a nutshell, here is how the Amazon PPC system works.
1. Select Your Category & Keywords
Before you are able to determine the average cost per click on Amazon for your niche, you will need to first select the category in which you sell and the keywords which you wish to target. With both of these tools, you will be ready to set up your advertisement and immediately know what the average cost per click Amazon lists for your niche.
There are many different category options to choose from. If you are lucky, you have a product which can realistically be listed in multiple categories. This makes you luckier than others because it gives you a larger playing field when it comes time to create Amazon PPC ads. More keywords, more potential search results, and so on.
2. Bid on Individual Clicks & Set Daily Budget
As you may already know, the Amazon Sponsored Products system works by first letting you select how much you are willing to pay when somebody clicks on your ad. Whether or not the person clicks on your ad and then purchases the item, each click is what will be charged to your account. Sadly, this also includes those who click by accident. This is something which is pretty unavoidable.
Once you see the average cost per click Amazon lists for your product, it is time to start thinking strategically. If you bid under the average there is still a likelihood that you will get some traffic. In all reality though, you will get much fewer clicks than those who bid a few more cents for each click than you did. Finally, make sure to set your daily budget at the absolute maximum that you can pay for each campaign. The daily budget is what you can use to ensure your campaign is never more expensive than what you planned for.
3. Those with Higher Bids Get Higher Visibility
Just as those who pay more for their plane tickets get better seats, those who pay more for their bids get more visibility. The amount you budget for each click and your daily budget will have a direct impact on the number of views you will receive on your advertisement. Accordingly, try to bid at a level where you know that your ad will get seen and then clicked.
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You don’t necessarily need to try too hard to outbid your competition, if this is your strategy. Imagine that you bid $8 for each click. The next highest bid in your category for the same time period is only $0.30 a click. Therefore, you will only pay $0.31 or so for each click. As a result, setting a high per click budget along with a strategic daily budget can help you become the top advertisement listing without spending too much of your extra money.
4. Other Advertising Platforms to Consider Outside of Amazon
Before you go all-in with Amazon, it’s important to remember that you can also use various other platforms and receive many of the same results. Of course, you don’t necessarily have to choose only one outlet for placing PPC ads. This means that anybody with some extra funds in their budget for advertisements may also choose to use another platform.
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For your reference, we will now show you some of Amazon’s top competitors when it comes to advertising products. Remember that each of the following platforms are alternatives, and not necessarily the same type of service as Amazon. They have different features, origins, and business models. Regardless, they can be used successfully for advertisements.
Google is perhaps the most popular internet website in the world. They also have the world’s number one search engine. As a result, anybody who wants to find your product will likely be able to do so using Google, especially if you have your own website for listing and selling your products.
Google’s PPC advertisement system is somewhat similar to Amazon’s. Of course, the average cost per click Amazon charges will not necessarily reflect what you find with Google, though. However, if you want a second opinion, a second quote, or simply another platform with which you are just as likely to succeed (using the right strategies), Google is another wonderful PPC advertising option to consider.
Without a doubt, there was a time when eBay was more popular and widely used than it is today. Regardless, it is still a heavily popular platform for buying and selling new and used products on the internet. Accordingly, it is also a place where many choose to advertise their products to this day. The benefit of using eBay is the fact that the payment system is much different.
Unlike what we see with the average cost per click on Amazon, eBay uses an entirely different business model when it comes to advertisements. You are not charged for each time someone clicks on a product. Instead, you only pay advertising fees when somebody actually purchases your product. There are advantages and disadvantages that come with this system. Understandably, many people prefer it over a PPC advertising system.
Alibaba is one of the world’s largest online marketplaces. It is also perhaps the largest alternative available on the internet which competes with Amazon. Best of all, Alibaba is a marketplace which uses a similar system for advertisements as Amazon does. This means that those who are already comfortable and confident navigating the Amazon PPC system will be able to easily switch over and use Alibaba simultaneously.
Those who wish to place PPC ads on Alibaba are likely also the same ones who successfully use Amazon PPC campaigns. Of course, there is also the possibility of the complete reverse. Alibaba is popular enough that it is plausible for one to use it for years without even thinking of using Amazon in addition. For best results, try to place PPC ads on multiple places outside of Amazon, perhaps including Alibaba.
Average Cost Per Click on Amazon: Tips for Choosing the Right Bid
As you discover the average cost per click Amazon charges for your product, there are still various things which you need to keep in mind should you wish to run a successful campaign. After all, the average cost per click Amazon uses is only a small portion of the large painting you need to see. Those who are successful with Amazon PPC ads know how many facets and variables need to be accounted for before submitting an ad for review.
1. Respect the Average Bid Price
The average bid price is the number which you should not be hindered by. Think of the average bid price being the minimum threshold that you must be able to reach before you will be able to begin a successful campaign in that category. It is not just some arbitrary number which has little significance.
In many cases, the average bid will reflect the category’s popularity. Additionally, it will reflect how much the sellers in that category are willing to invest for each click. When you discover the average bid, respect it for what it is. It is what you need. Do not imagine a scenario where you bid under the average and receive a large return on your investment. That simply won’t happen.
2. Bid Above the Average Cost Per Click
If you haven’t already read between the lines here, never bid below the average. There are few strategies worse than this. This is like showing up to an airline ticket and requesting that they give you a first-class ticket for the price of a budget seat. You will be refused. The difference between the service that you receive compared with what you expected (first class) will be ginormous.
However, if you bid right at or above the average cost per click Amazon charges for your category you can ensure that your advertisement will be both seen and clicked. If you bid lower than the average, you should expect that your advertisement will be seen and clicked far less than what you aimed for. Be smart and bid at a comfortable rate which will ensure plenty of clicks and accordingly, purchases.
3. Consider the Popularity and Price of Your Advertisement
If the bid you need to place for your Amazon Sponsored Products advertisement is simply too much, don’t place the advertisement. There will always be occasions where it is a good time to advertise and occasions where it won’t be cost effective. As an entrepreneur, your job is to determine when each of these time periods begins and ends.
If the average cost per click Amazon wants to charge for your PPC ad is simply too high, then wait a week or so. Or, you can always change the targeted keywords and strategy. In any case, make sure to account for the popularity and potential costs of your advertisement. Since the goal is to make a profit, it’s important to strategically select when to advertise and most importantly, when not to advertise.
4. Pick the Right Keywords
As you likely already know, a major focus of Amazon Sponsored Products advertisements centers around the keywords one wishes to use. These keywords are what potential customers search in the Amazon search box to find your product. Those who have done plenty of time researching and finding the right keywords will notice that their campaigns are more successful than those who don’t know what they are doing.
Think of keywords as being one of the cores of a successful Amazon PPC campaign. If you select keywords which are popular, have a low PPC price, and are searched consistently, you can end up turning a huge profit when your campaign expires. Although keywords are very important, they are only used effectively alongside a high quality product listing and PPC strategies to make it visible.
5. Spend Time Consistently on Research
Part of a being a successful salesman is knowing all the right strategies and implementing them to perfection. Of course, this isn’t possible if you never spend the time to become great at what you do. Nothing in life comes to you handed on a platter. If you want to be a successful Amazon salesman you will need to spend consistent time researching and studying the system itself.
After all, anybody who wishes to make money using a platform needs to understand the platform. You wouldn’t try to become a professional fisherman, for example, if you didn’t know how to cast a fishing rod. On the same lines, you cannot be a professional Amazon salesman if you do not know how the system works. Spend a little bit of time each day learning more about the system and its rules until you are completely comfortable and confident using the system.
6. Consider Premium Online Tools
There are various tools which one can use to increase their knowledge and skill on the Amazon platform. Since many aspects of the record keeping, research, and management of an Amazon account can prove to be difficult for some, one popular option to consider is using premium online tools.
Online tools can be used to accomplish things like keyword research, accounting, learning from failures, trying new strategies, and much more. In fact, there are even Amazon Sponsored Products management services which one could use if they want to pay somebody to handle their account for them. If you have great products and some extra funds to use for employing a management service, this could end up saving you a lot of time.
7. Improve Your Product Pages and Advertisements
Back in school, one thing you probably realized is that when you turn in hastily-completed homework you would typically receive a subpar grade. From this experience, you should have learned that there are many different circumstances where it important to put forth your best effort.
Before you start setting up Amazon Sponsored Products advertisements, spend some time on your account managing your listings. Make sure that you have professional stock photos, descriptions, and so on. Then, make sure you construct a PPC listing which exemplifies the hard work you put into creating the high quality brand and service you have.
8. Consider Using Alternative PPC Platforms
Amazon PPC ads may be your first frontier. However, once the success comes in and you start increasing your budget for advertising, will you solely use Amazon?
Probably not. It is important to plan for the future campaigns, including the platforms which you wish to use. Although you may stick with Amazon PPC ads for now, start considering other platforms for the future.
After all, there are many high-quality platforms that one can use to advertise their products with. Sure, Amazon may be the most popular option right now, but this can change. Be ready and willing to use different platforms in addition to, or instead of Amazon in the future. Decide based on your success rates and personal circumstances.
9. Study Your Competitors
Knowing that you have competition is one thing. Knowing your competition is another. In just about any product category, you are bound to have competition of some sort. Those who put in the extra effort to study their competition and learn their formula for success will be at an advantage. Know their audience, the keywords they use, their marketing strategies. Know everything you can about them.
9. Calculate Your Projected ROI
Finally, with all the right tools and information in place, you can start to estimate ROI (or return on investment). Imagine that you have calculated that every 10 clicks you receive on your product page will typically result in a sale. If you spend $0.30 for each click, and receive a profit of $5, you will have earned $2 when you account for the investment.
Of course, it may take some time before you are able to estimate your ROI with a campaign. However, the more data you take the easier it will become to confidently submit more and more PPC campaigns. If you know roughly how much you earn with a set number of clicks, you can calculate your projected ROI rather easily.
Average Cost Per Click on Amazon: Summary & Contributing Points
The average cost per click Amazon lists for each keyword and corresponding product category is not something which can be pinpointed and narrowed down into one number which can be referenced by anybody. However, typically the average cost per click Amazon lists for their Sponsored Products advertisements is less than a dollar. If you know how to use the Amazon system correctly to your advantage, there will be nothing in your way which stops you from becoming a successful seller.