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How to Use PPC to Gain Market Share on Amazon in 2024


March 21, 2024


Right Side Up recently hosted a webinar, led by Tom Kluis, general manager, Amazon and ecommerce marketplaces at Right Side Up, about how Amazon vendors and sellers can use PPC to increase market share. Check out the recap below or watch the full webinar here.

Amazon’s ad platform provides many ways to reach your potential customers—as well as many ways to waste money with ineffective ads. Understanding which keywords and products to target, which to negate, and how high to bid can make the difference between inefficient spending and incremental share-gaining strategies. 

In this article, we’ll outline how to structure your campaigns, build portfolios, use negative targeting to steer your budget, and optimize your targeting and bids for long-term success. If you’re ready to master Amazon PPC strategies, let’s dive in.

How to Identify and Measure What’s Truly Incremental

Before we get into Amazon PPC tactics, let’s talk about incrementality. We need to understand which newly acquired customers are truly incremental—in other words, which new customers or new sales that you would not have otherwise acquired without clicking or seeing the ad.

There are different ways to calculate this, but here is my favorite formula: 1 minus (organic clicks for your brand on a keyword / total clicks for the keyword)

Here is an example. Let’s say total clicks on a given keyword is 25,000 and the organic clicks that your brand gets on that keyword is 5,000. 5,000 divided by 25,000 is 0.2. So back to the formula, 1 minus 0.2 = 0.8. So your brand has 20% click share on that keyword (5K of the 25K is 20%). That means an 80% chance that a new click on that keyword is incremental. 

Some keywords will have high incrementality; some will have low incrementality. The key is to understand the difference so you can allocate your budget in the right place.

Why does incrementality matter?

A focus on ROAS (return on ad spend) sometimes leads to chasing what feels like “good” terms. But those “good”  terms often have low incrementality, meaning they aren’t capturing net new customers. Keywords with high ROAS may not actually be the best keywords for incremental share thinking.

Let’s say you have a branded keyword with 90% click share. You want to chase ROAS on that term. If you throw $100 in ad spend at that keyword and get $2,000 in sales, you have a ROAS of 20, which is great. 

But wait a minute—how many of those clicks are new customers? If you have 90% click share on that keyword, that means that only 1 in 10 ad-related sales will be new to you. You would’ve gotten the other nine already. So in this example, only $200 of your $2,000 in sales were incremental. And you spent $100 in ads to get $200 in incremental sales, for a ROAS of 2 for new customers. 

You have to think differently about how you’re going after customers and how you’re going after specific keywords with this focus on getting incremental sales to drive incremental market share. With that said, branded ads are also super important. You have to play defense and dominate those searches. But when seeking new, incremental sales, you have to think beyond branded terms and ROAS.

What does incrementality mean for your ad strategy?

Low ROAS may be fine if you can still marginally break even. In the long run, understanding your margins helps build economies of scale, increases organic rank, and spins the flywheel, which is important on Amazon.

This requires you to understand your marginal breakeven. If you sold one more item, what is your actual additional profit? This is what you charge the customer less Amazon fees, less shipping, less manufacturing costs, less returns, etc as a seller. As a vendor, it’s similar but a slightly different set of expenses.

Let’s say you have a relatively weak competitor in your category. You have 2% organic click share on that competitor, so for every 100 sales on that keyword, the odds are that 98 of them are new to you. If you spend $1,000 and get $2,000 in ad sales (for a 2 ROAS), you’d think that isn’t very good. But, $1,960 of those $2,000 are incremental—you wouldn't have gotten those sales without the ad. If you go back and look at margins, were you profitable on those $960 incremental sales? If you were, then you made money, you gained share, you ranked higher, you're moving up the bestseller ranks, and your competitors are probably moving down the bestseller ranks. 

Also, if these customers are likely to be repeat purchasers, factor that in. The key here is thinking about both incrementality and then marginal profit to be able to spin that flywheel. 

Low ROAS is not necessarily bad if you're acquiring incremental customers.

Where do you get this information?

Calculating these metrics varies based on whether you’re a vendor or seller, and which software partners you have. We like Pacvue’s Category Intelligence, Helium 10’s Magnet, and Stackline Atlas, though there are many other reputable software options to find clicks per keyword searches, search volume, etc.

For sellers, check out Amazon’s Search Query Performance Report and the Product Opportunity Explorer.

For vendors, you can back into some of these numbers using Brand Analytics and Glance Views. And remember that Amazon’s reports are always evolving; keep an eye out for rollouts of new data and insights that can help. There are many ways to get this information, and no singular, perfect method for doing so.

Why and How to Use Portfolios

Portfolios enable you to not only look at the businesses and campaigns that you're serving—and see how they're doing at a glance—but also to constrain some of the budget. They provide structure to your ads.

There are three main reasons to leverage portfolios:

  • Organization - Grouping campaigns with similar strategies can allow you to monitor results and drive incremental sales and share.
  • Budget management - Each portfolio has its own budget, allowing more control of where and how ad dollars are spent—offensively or defensively.
  • Predictability - By tailoring and segmenting your campaigns, you can ensure branded, category, and competitor searches are served as expected and budgeted.

Here are the five portfolio structures we consistently use with clients:

  1. Branded: Covers all your brands and sub-brands, including common misspellings.
  2. Competitor: Covers all of the brands and sub-brands you want your product to show up against.
  3. Category: All searches without a brand attached. These can be highly specific or general.
  4. Last resort - AutoGen: Covers low-bid campaigns to capture long-tail keywords and your automatic campaign of last resort.
  5. Test and learn: Covers tests or campaigns that you want to watch apart from the rest.

We’ll now discuss each type of portfolio structure individually. But first, a quick note on building your campaign foundation.

Build the foundation

The first step in enabling incremental share growth is ensuring that campaigns are structured correctly for predictability. This includes developing nomenclature, setting your budget, and understanding negative matching.

Naming conventions

One option is to use the brand name, the portfolio it’s in, the ad type, and then other variables to drive further clarity. Brand name | Portfolio | Ad Type | Variable 1 | <Variable 2>

Here are some examples:

Kodiak | Branded | SBV | Waffle Mix

Cheribundi | Competitor | SP | SingServ | Tier 1 Comp

graphic showing examples of Amazon PPC naming conventions

In this example, SP stands for sponsored product, SB is sponsored brand, and SBV is sponsored brand video.

Some software packages enable tagging, which is another very similar way to approach naming. The goal here is to create a standard naming convention, use it consistently, and have something that makes sense for you and your team long term.

Setting budgets

Your budgets will be determined by how much money you have to spend, of course, but here’s how we suggest allocating that money across your five portfolios. 

There are many important considerations, such as how sophisticated your competitors are, how aggressively you’re looking to grow, what your products are, etc. Generally speaking, we like to put no more than 20% of the budget into branded campaigns, which should be enough to keep competitors at bay.

If you’re the leading brand in your category, you’ll still have to play defense to protect that position. You’ll need to understand who the up-and-coming competitors are and try to undercut them. This may mean investing more in branded keywords, but it also might mean increasing your investment in competitor keywords in order to target those specific brands. As a leading brand, your incrementality leverage is going to be versus competitors.

On the other hand, if you’re an emerging brand, you probably won’t want to go after the king. Instead, look at the competitors around you, the number two, three, four, etc. Find out which ones are less sophisticated with their Amazon ads and start conquesting their customers to increase your position. As a challenger brand, your incrementality leverage is going to be both category terms—because you have low clicks already—and the weakest competitors.

If you're a higher-end brand and your average sale price (ASP) is higher than your category average by a fair amount, consider spending more against competitors.

For the competitor portfolio for high ASP brands, we allocate 40-50% of the overall budget. And then put the rest into the category portfolio. When people search for a category, they're also generally price sensitive, and they're generally going to click on the lower-priced item. For example, if the average swimsuit is $35, and you're selling a $60 swimsuit, you’re going to have more luck going after the other $60 swimsuits than going after the $30 ones.

graphic showing 20% - 30% - 50% split for Brand, Category, and Competitor Portfolios in Amazon PPC

So what about the final two sections: auto-gen and test? The automatic campaign, at a nickel a bid, costs virtually nothing, but you’ll still get results and learn from it. And for your testing portfolio, it depends on your goals. You may need to cut back on one of your other portfolios to put a little more money there, but starting with a 20-50-30% split on brand, competitor, and category is a good starting point.

Understanding negative phrase matching

Leveraging portfolio structure in conjunction with negative matching steers searches to the right buckets, improving your understanding of incrementality and customer behavior. This approach enables you to tailor your bid and overall investment more effectively, driving the most relevant results.

To state it simply, phrase matching lets you specify what you want to target, whereas negative phrase matching allows you to state what you don’t want to target. For example, you want to target “Kodiak high protein oatmeal,” but not “pancakes.” Or you want to hit “one-piece swimsuit,” but not “swimsuit coverup.”

Negatives allow you to get granular with your campaigns, specifying exactly where you want your ads to show up as well as where you don’t want them to serve. This ultimately helps avoid wasted money and time.

Two crucial notes about functional negatives: it’s important to avoid being too aggressive with them, and you need to ensure everything has a home. For example, if someone is searching for “Kodiak waffle mix,” but all of your campaigns have “waffle” as a negative phrase match, you’re not going to show up in any ads. Be thoughtful about your game plan ahead of time.

Now that you understand the basics of negative phrase matching, let’s get into setting up your portfolios. 

Note: There's currently no way to delete or archive portfolios on Amazon. You can turn them off, you can remove all the campaigns from them, etc. but once set up, they’re there forever.

Branded keyword campaigns and ad groups

The first portfolio we recommend creating is branded keyword campaigns. This should house all variations of your brand name, plus any sub-brands that customers will recognize, including common misspellings. You want all of these variations set up so that when someone comes searching for your brand and your most popular or highest-rated products, they’ll find you. Show your customers what you think they’re searching for. These are manual campaigns, and may be quite extensive if you have a large brand presence.

Let’s go back to the Kodiak branded sponsored product example: Kodiak | Branded | SP | Pancake Mix. Within this campaign, you’d first set up your targets and ad groups how you'd like. One option is to set up the different variations with their own ad group, so one for buttermilk, one for chocolate chip, and one for blueberry, for example. Another option is to separate out your phrase and exact match campaigns if that’s your preferred style. Whichever you choose, be thoughtful about how you do it.

Even if you’re not setting up separate ad groups for phrase and exact match campaigns, you’ll still want to leverage both of them. For certain categories, like clothing, people will often search for a brand, a type of clothing, and then a size. If you're not setting up both exact and phrase targeting, you're going to miss a lot of those shoppers who don't put in the exact phrase. 

Finally, put in negative phrase matching for functional negatives. These are phrases you don’t want to include; negatives allow you to tell Amazon where to exclude these ads.

branded keyword portfolio example from Amazon Ads

The example above shows how this looks in the AMS console. We want to show up for Kodiak, in this example for the pancake mix, plus the former brand name “Kodiak Cakes.” And also “Power Cakes” since that’s a sub-brand. There are probably other words to add here, but this is a good start.

Then, for the negative keyword targeting we have “waffles,” “oatmeal,” “cup,” and “single-serving.” Again, this list could be quite long. 

You may be wondering about this negative list because those are probably terms that are important to your brand. But for this campaign, which is specific to the pancake mix, you don’t want your waffle mix, single-serving products, or oatmeal cups to show up in that ad. You want to be able to deliver the ad experience for the most related product or category based on their search. This means excluding the things that aren’t what they are looking for. If someone just types in “Kodiak” or “Kodiak Cakes,” these negatives won’t fire. 

Negative keyword targeting these functional negatives allows you to steer with a little more granularity to what shows up when a customer searches. And remember, be strategic about where your negatives live.

Here are a few final tips for building your brand campaigns:

  • Shoppers don’t often overlap brands on a single search—no need to negative match competing brands.
  • Sponsored Brand and Sponsored Brand Videos have limited ad inventory and require higher defensive bidding than sponsored products.
  • If you need to save on ad spend, scale back on Sponsored Products.
  • Sponsored Display campaigns targeting your whole product line can be effective.

Competitor keyword campaigns

Your next portfolio will be for competitor keyword campaigns, which can be considered the mirror image of your branded portfolio. Here you’ll be targeting specific competitors’ brands and top products. This is the case where a customer comes in with a predetermined notion; they want to buy your competitor's products, and you want to steal them away.

The most difficult part of this is that it isn’t one-size-fits-all; some competitors are more sophisticated, so you need to understand who you're going up against, and which of their customers you're more likely to convert. You’ll need to continually review and adjust this portfolio.

Let’s use Sunsets Swimwear in this example: Sunsets | Competitor | SP | Tier 2 Competitors. We’ll be using ad groups with variations and phrase/exact match, and putting our best foot forward with our most popular, highest rated, and most comparable products. This is not the time to be clever, promote a new product launch, or showcase products with few reviews. The goal is to steal customers from competitors, so you’ll need to lead with products that will help achieve that. Be specific in your keyword targeting to capture all the right terms.

screenshot of Amazon Ads PPC portfolio for competitor keywords

In this example, the target keywords are the specific brands and products that Sunsets can compete against, like “Tommy Bahama swimsuits.” You’ll notice we’re targeting women’s swim with these keywords. Your negative keywords will probably focus on the types of items that you don’t want to show here. 

Many brands also sell other product types; in this case, pajamas or swim coverups. You’ll want to exclude those so you’re only showing products related to the competitor search. Again, be thoughtful about what keywords you enter, when you want to serve them, and importantly, when you don't want to serve them. You don't pay unless somebody clicks through to your page, but if Amazon sees that you're serving a lot of ads and getting low click-through rates, they’re going to stop serving those ads. 

Here are a few more tips for your competitor portfolio:

  • Research is key—Amazon’s autofill search bar guides customers, use it to populate your keywords.
  • Don’t use competitor brand names only; also incorporate key product details.
  • Use keyword combiners to cover bases, or cut-and-paste from a spreadsheet to make sure all competitor brands and product combinations are included in your campaign details. Your lists may get long, so it’s important to stay organized.
  • Your ROAS will be low, but almost all sales will be incremental. Be sure to model out your CTR, CVR, and AOV to set your break-even bid/CPC. Don't go into this blind; run some tests to understand what you need to bid to get these incremental customers.
  • Customers might consider your competitive set differently than you do. Don’t focus on premium brands, for example, if your customer set doesn’t consider you to be premium. To win with competitor searches, you have to be truly comparable, in the eyes of the shopper.
  • Watch your search term reports, and read and adjust. Don’t be afraid to add or remove brands.

Category keyword campaigns

Your next portfolio—the one with the most search volume and competition—is for category keyword campaigns. This is much more of a Wild West environment, as you’re targeting shoppers with no predetermined brand preference. You need to fine tune these campaigns to make sure your ads are predictably firing when you want them to fire. Negative phrase matching is extra critical.

Be thoughtful about ad grouping. Exact and phrase matches need to be highly specific. There could be tens of thousands of searches, and if you're not doing it the right way, you can waste a lot of money by serving up an inappropriate ad. Make sure you're serving up the right product; some of those low-volume keywords could be very effective if you serve up the right ad.

Here’s an example for Cheribundi tart cherry juice: Cheribundi | Category | SP | Single Serving | Tart Cherry terms.

Amazon Ad PPC portfolio example showing category keyword campaign

On the left, we’ll be using phrase and exact match on all the terms that relate to the product in the ad grouping, including common misspellings if applicable. This might be a long list, depending on the qualities and features of your product. In this case, we’re focusing on “tart cherry” because that’s the flavor of this product, but we’re also using “drink,” “juice,” “no sugar,” “unsweetened,” etc.

But here, our negative keyword targeting will be even longer because we don’t want to show up for our brand, competitors’ brands, or other product types. The only searches that should filter through to this portfolio are ones that don’t have a brand attached. You can see in the example above that Cheribundi is there (including misspellings), plus a few competitors, and other related products like “gummies” and “concentrate.” This is where those functional negatives become important. If your product isn’t organic, but your ad serves on a search for “organic tart cherry juice,” it’s going to be a waste. People will click that ad, realize that you’re not actually what they were explicitly searching for, and won’t buy your product. But you’ll still pay for the click, and Amazon will take that as a cue that your ad isn’t relevant, which hurts your overall rankings.

So, be really thoughtful about your negative match keywords. This may require you to be critical about who your product is and isn’t for, and what it does and doesn’t do.

Other things to consider for your category portfolio:

  • Use Amazon’s autofill search to determine long-tail keywords and common search behavior, and use combiner tools to ensure you get all the right keyword combinations into your lists.
  • Negative phrase match your brand and your competitor brands. You don’t want brand or competitor searches to land here.
  • Focus on the functional negatives of the product.
  • This is where you’ll see the highest search volumes. Be careful of overspending and underspending.
  • Stay away from single-word matches—you’ll show up for too many inapplicable searches.
  • Experiment with top-of-search modifiers to increase your bids to show up on the top of the search page. Sometimes these are effective, but sometimes they drive up costs without commensurate sales.
  • Use your Search Term Report to mine for negatives and positives. It has 65 days of historical information so you can find the competitors and terms that you missed. Fix your portfolio criteria to steer those the right way. 
  • More specific keywords often have higher conversion rates because people know what they’re looking for, which will justify higher bids.

Campaign of last resort and auto-generator campaigns

Your fourth portfolio should be for a “campaign of last resort,” or auto-generator campaign. This is intended to fill in gaps; it should not be your only campaign, which is where many marketers go wrong with Amazon PPC. 

The “campaign of last resort” is the catch-all bucket for long-tail keywords, but also supports when other campaigns unexpectedly run out of budget, a new competitor enters the market, or ad space inventory becomes available (and is cheap). 

Consider this your umbrella or catch-all campaign that captures the intent from outside of your brand, competitor, or category campaigns. This is an auto-targeting portfolio, with ultra-low bids—$0.10 or lower. Put your best items in these ads.

Test and learn portfolio

The fifth and final portfolio will be a place for you to test and learn. This can be a standalone space with a dedicated budget and reporting where you can try new ideas and concepts.

Example portfolio structures

Let’s now go through an example of search terms to further illustrate why search structure and portfolios matter. 

screenshot graphic showing search terms, keywords, CPC, ROAS of an example portfolio structuret

In this first chart above, you see search terms, the related keywords, cost per click (CPC), ROAS, and whether it’s an audience of new customers or not. This non-portfolio PPC campaign is broadly targeting the keyword “magnesium supplement.”

Without a portfolio structure, all these searches end up looking the same, even though search intent is very different. If someone is looking specifically for the Momentous brand, in this example, they either already know the brand, have seen one of their ads, or are a repeat purchaser. So if you’re not sophisticated when setting up this campaign, and it’s running on this keyword, we may get some new customers, but the same ad is firing for a variety of use cases and searcher intentions. You might be able to dig through your search term report to understand how many searches are for the brand versus for competitors. But there's a better way to do this.

Now let’s use the same supplement and search terms, but with portfolios in place.

example search terms with keyword, CPC and ROAS for an Amazon PPC campaign

In the above example: 

  • Branded searches will bring those high-intent customers directly to our top product.
  • You can also capture the general category search term. You may want to bid more here because this customer is already looking for a good product and they aren’t as loyal to a brand.
  • You can also target a specific competitor and product—not just competitors generally. You’ll have a higher CPC, but it will be high ROAS and those shoppers will be incremental.
  • Finally, an automatic or last resort campaign focused on more informational or general searches, like “supplement to help sleep.” These will have ultra-low bids, but often with high ROAS and likelihood for incrementality. 

These two examples have essentially the same final performance, but with portfolios, you have a more granular view of what’s happening, where shoppers are coming from, and where to put your dollars for future campaign success.

Portfolio structures help you differentiate what you want to go after and what you don’t. Enabled by negative matching, portfolios deliver ads predictably, which provides visibility into behavior, incrementality, and investment.

Get Help Building Your Amazon PPC Portfolios 

Ads are vital for all Amazon sellers. Even those with top brands and great sales need to play defense to protect their position.

But it takes planning, foresight, and active monitoring to get these campaigns right. 

If you need help maximizing your Amazon presence and building out your ad portfolios, our Amazon and ecommerce marketplace team would love to help. Reach out to get started!

Through the use of data-driven decision-making, market intelligence, and behavior analysis, Tom has consistently steered consumer brands toward success. His diverse expertise spans twenty years and varied product categories including consumer electronics, clothing, automotive, pet, and grocery. Notably, Tom has played pivotal roles in both revitalizing established brands and pioneering new product categories.

It all started with a journalism degree from Boise State University, but no desire to work in a newsroom. The year was 2006. Magazines were the only real freelance path, but incredibly hard to break into. So Amber did what anyone would do...take an administrative job. Then get an unusable master’s degree in holistic health studies that ignited a love for research. Then take a sabbatical. Do yoga teacher training. And finally, actually be a writer. A decade later, one adtech giant, three tech startups (two in cannabis), and several large career progressions including head of content and head of marketing, she now serves as a fractional content strategist and writer. Amber lives in the UP of Michigan, and spends as much time as possible outdoors.

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