Amazon’s New Bid Optimization Features Explained

Amazon’s New Bid Optimization Features Explained

Amazon recently launched 3 new bid optimization strategies. The goal of these strategies is to improve the performance and control of your ads. 

The secondary goal is to provide better insights. 

We all want better ad performance, so these changes are welcome. But how do they work? And, more importantly, how do we use them?

Out With The Old

Remember the bid+ option when making your ads? Well, that’s been retired (as I’m sure you may have noticed). So now we’ve got these options instead of the old bid+ strategy. 

The new options – namely Dynamic Bidding, Placement Bid Adjustments and Placement Performance Reporting – allow for greater control and better insights. Which helps you make smarter choices with your advertising. 

Are we a fan of the new features? 

You bet. 

Here are the new Amazon bid optimization features:

1. Dynamic Bidding

Dynamic bidding allows Amazon to change your bids according to the likelihood of conversion. There are two types of Dynamic bidding. 

Down Only

This option will lower your bids in the event a click is less likely to convert. This results in less unnecessary ad spend. 

So, for example, if a customer who is less likely to buy your product lands on a page where your ad may be displayed, your bid will automatically be lowered. So you could lose out on an impression from this customer. But if your main goal is conversion, this is the way to go. 

Up And Down

This is a slightly more aggressive tactic. Instead of only lowering bids for unlikely conversions, this strategy also raises bids for customers more likely to convert. 

You’ll still get fewer impressions, but the impressions will be more valuable. Again, if conversion is your main goal – and you’re willing to gamble just a little – this is the strategy for you. 

Fixed Bid

If awareness is more important to you than conversions, this strategy should be considered. 

Your bid won’t go up and down if you choose fixed bid – no matter what. So if you’re looking for more impressions, this is the strategy to go for. 

2. Placement Bid Adjustments

The second new feature. This allows you to refine your bid for each of the categories available on Amazon. Including Top of Search, Product Pages and Rest of Search. 

So depending on where your ads perform best, you can set higher or lower bids to better manage your ad spend and return on advertising spend (ROAS). 

But how do you know where your ads perform best? 

Well, that’s the final new feature. 

3. Placement Performance Reporting

This final feature allows you to see exactly how your ads are performing – in each of the placements available to you. 

So you’ll get exact figures on each placement. So you can make better decisions when it comes to ad spend. 

No more guesswork. 

How Will The New Features Benefit You?

We’d love to know what you think about these new changes. How will they impact your business? Are you going to be more aggressive now with your ad campaigns? 

Or are you going for awareness and utilize the fixed bid strategy? 

Let us know in the comments below. 

And if you have any questions or concerns, give us a shout. We’re happy to help.