The 6 Basic Functions of Amazon PPC Advertising

The 6 Basic Functions of Amazon PPC Advertising
October 27, 2021
Basic Functions of Amazon PPC Advertising

PPC (pay-per-click) advertising is an extremely effective short-term tactic.

There are several benefits for any seller who incorporates the Basic Functions of Amazon PPC Advertising into their product marketing strategy. 

When utilized correctly, an Amazon PPC campaign can significantly boost online traffic and yield a measurable ROI in comparison to many other marketing tactics. 

Basic Functions of Amazon PPC Advertising

Unlike free content or organic search strategies, pay-per-click advertising enables sellers to immediately reach thousands of shoppers who are searching for products in their niche.

Content and SEO strategies will certainly generate benefits over the long-term, but if a seller is seeking fast and powerful results, PPC advertising is an excellent means of doing so.


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The most fundamental reason to use Amazon PPC advertising is to gain traction, especially if you are a new seller in the marketplace. 

Sponsored Products ads, Sponsored Brands ads, and Sponsored Display ads can be used to build awareness, which can help place a seller’s products in front of active buyers looking to make a purchase. 

The more a seller’s ad appears in the search results alongside the ads of competitors that shoppers are already familiar with, the more opportunity that seller has to win the sale.



PPC advertising can be used to improve a seller’s organic rankings of highly competitive keywords. Because PPC allows sellers to see immediate results, they can identify those keywords that are driving traffic and which ones are less effective. 

Sellers may have keywords in their listings which are too competitive to rank in an organic search. Running PPC campaigns for those keywords helps to build visibility. Having the first-page result for those keywords not only brings in sales but also increases the organic ranking of a seller’s product for the keyword over time. 


True ACoS

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ACoS or Advertising Cost of Sale, measures the relationship between a seller’s ad spend and their ad sales. It shows for every dollar earned from PPC; how much was spent on PPC. The problem with ACoS is that it is limited to measuring only a seller’s advertising efforts. It fails to measure the true value of a seller’s ad spend and how it impacts the overall performance of their business. 

PPC advertising can be used to discover a seller’s True ACoS or TACoS. Like ACoS, a seller’s TACoS is relative to their business and PPC goals. However, unlike ACoS, monitoring TACoS will give sellers a more precise indication of how their advertising is impacting the overall performance of their businesses. This allows sellers to optimize their SEO targeting to produce better results. 

How To Calculate True ACoS (TACoS):

TACoS = Total Ad Spend / Total Sales x 100. 

Armed with this information, sellers can use Amazon PPC far more effectively as a long-term growth strategy.



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PPC advertising can be used to collect important research data. There is a perception amongst Amazon sellers that Amazon PPC is only useful for generating sales and increasing page rank. However, Amazon PPC advertising can be used for other important functions such as to perform keyword research and for collecting product research data.

With PPC campaigns, sellers can collect data on the exact numbers of impressions, clicks, CTR, conversions, sales, and profit for specific keywords. 

PPC campaigns also permit sellers to do deep dives to determine whether or not their titles, backend keywords, bullet points and descriptions are fully optimized for their top converting and revenue sales generating keywords. 

Once a product is live, sellers can run PPC campaigns to collect several months of data in order to discover their top performing keywords based upon actual sales generated and conversion rates. This process helps to ensure that a seller’s products are truly optimized for their top-searched and most relevant keywords.


Touch Points

A touchpoint is any time a prospective customer or current customer comes in contact with a seller’s brand during the different stages of the Customer Buying Cycle

For example, shoppers may become aware of a seller’s products by seeing a PPC ad, look at star ratings and reviews, visit their storefront, or contact customer support. It’s any way a consumer can interact with a seller’s business, whether it be through an app or any form of communication (email, social media, etc.). 

Experts have different options about how many touchpoints it takes to make a sale. Some estimate anywhere from 28-62 touchpoints is required, while others believe the number may be upwards of 500 touchpoints. 

Many factors go into how many interactions with a seller’s brand a shopper will have before making the purchase. These factors include sales cycle, price, brand perception, brand loyalty, and audience demographics

While the number of touchpoints required to make a sale is essential information, the importance of quality touchpoints greatly outweighs the focus on quantity. 

Amazon PPC should be implemented to increase quality touchpoints. Using their first-party proprietary data, sellers can target shoppers through audience segments based on categories such as lifestyle, in-market, and lookalike. These audiences can be targeted with PPC ads across Amazon and third-party websites.


Obtaining Customers

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Amazon PPC advertising can be used to attract potential buyers to a seller’s products in order to generate sales. When shoppers see strong and positive ads, they are more willing to buy and are primed to choose a seller’s business. 

An effective PPC campaign should be able to attract shoppers’ attention, hold interest, arouse desire for an advertised product, and stimulate action. Sellers should focus on raising awareness, convey a clear message (convincing copy), and include an explicit call-to-action.

Utilizing Amazon PPC comes with both opportunities and challenges. Sellers need a strategic and flexible advertising plan to stand out in an ever-growing marketplace. 

If you need expert help in developing and managing that advertising plane schedule an exploratory call with Entourage Management Services. Entourage Management Services can provide you with a dedicated account manager to handle all aspects of the day to day management of your Amazon ads.


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About Mike Zagare

He is the owner and founder of PPC Entourage, one of the original amazon ad software and management companies. Mike started off as a physical therapist in 2015 and just knew there had to be a better way so he started his ecommerce journey. Using the power of Amazon Ads, he built a 7 figure brand in less than one year. Now he helps other sellers do the same with free valuable education, PPC Entourage software and the ad agency. He is also the author of the Amazon Ads Playbook series.

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