How to Advertise on Amazon in 2021

amazon advertising with six logos around it

Ah, Amazon – it seems like it’s taken over the globe. We can get virtually anything we want with two-day Prime shipping and Prime Now, and we as consumers can’t get enough.

The good news is that we can use that devotion and loyalty to our advantage. Since Amazon knows what people are buying and how they’re doing it, why aren’t you advertising on Amazon to get more eyes on your products? You may already be all over Google Paid Search, Facebook, and Instagram, but there’s no better time to break into one of the largest remaining online ad networks.

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What Are Amazon Ads?

When you type a keyword in the Amazon Search box, you’re presented with products related to your search. This is where 70% of customers shop – on the first page of the results. Any products you see with the words “sponsored” written by them are considered Amazon ads. Some will be inline with your search results and some will be on the top of your search results. We’ll get to the different types of ads later.

amazon advertising

Advertisers who want to gain more visibility on Amazon can pay for these positions by bidding on specific keywords related to their product. The benefit to the advertiser is that they will only be charged when a shopper clicks on their ad – similar to Google AdWords. 

Amazon ads can also appear on individual detail pages (product pages). For example, when looking at the baby wipes product below, you can see an ad for baby diapers.

Photo of Amazon product

As you scroll down the page, you’ll find even more ads!


The beautiful thing about Amazon ads is that these aren’t the only type of ads you can create. We’ll get into the three different types of ads in this guide.

Should I Advertise on Amazon?

Do you sell a product online? If the answer is yes, then yes – you should be advertising on Amazon! It’s another layer of eyes on your products and potential new customers.

If you’re hesitant, we recommend starting small with a product that you already know sells well online. For example, if you sell winter gear and you know your snow pants are your top-selling product, start with an ad for your best selling snow pants. Once you’ve built some traction on Amazon Advertising, you can start to incorporate the rest of your product catalog.

Another reason to advertise on Amazon is that if you’re doing Amazon PPC, your organic Amazon rankings will likely improve as well. Amazon sellers know that sales history is a very strong ranking factor, so if a product sells well, Amazon will place it higher up in the search results.

Amazon Advertising Costs

So what does it cost to advertise on Amazon? The short answer is: it differs. One product category may have completely different costs than another. For example, we noticed that the average costs among our clients increase from about June to August and back up again from November to December. However, throughout the calendar year, we see an average CPC of just under $0.50. 

Types of Amazon Ads

When it comes to ad creatives and types, Amazon has come up with some great options. There are three main types of ads you can configure: Sponsored Product Ads, Sponsored Brand Ads (formerly known as Headline Search Ads), and Product Display Ads. The latter can only be done if you’re a 1P seller (first-party vendor through Vendor Central). If you’re a 3P seller (third-party seller through Seller Central), you can use the first two options when creating your ad types. 

What if you don’t know what type of seller you are considered? 1P sellers are by invitation only and the rest are considered 3P sellers.

Sponsored Product Ads

Sponsored product ads run similarly to the Google Shopping Network. These are ads that almost look like the rest of the products you’ll see on Amazon. 

With sponsored product ads, you create a campaign with specific keywords related to your product. These keywords can be set as broad, phrase, or exact. From there, customers will see your ad through an impression, and you won’t be charged until a customer clicks your ad and goes to the detail product page. 

Sponsored product ads are displayed across a variety of places on Amazon to make it easier for customers to find your products. They may appear in desktop, tablet, and mobile and app placements. They can also appear at the top of search, middle of search, bottom of search, and on on detail pages after product information (“sponsored products related to this item” section). 

an example of sponsored ads on an amazon search results page

Sponsored Brands Ads

Sponsored brands ads display at the top of the search results page as a headline banner ad, like the example below. These draw your attention and are valuable real estate on Amazon. Sponsored brands have more customized options, like setting your own headline text and your own brand image. Once a customer clicks on the ad, you can send them to either your brand store (if you have one) or a custom landing page within Amazon that displays all the products you offer. You must promote three or more products together in order to create this type of ad. 

These ad types allow a lot of creativity and are a great way to showcase your brand. They also use the same cost-per-click method.


Sponsored Display Ads

Lastly, we have product display ads. These work differently from the two already mentioned, and they’re only available to 1P sellers. These ads are not keyword targeted, but rather interest or product targeted display ads. So, they display on product detail pages through similar interest or through specific ASIN targeting. Like the other two, these also use the cost-per-click method. 

We love using these at Laser Sight Digital for a defensive strategy (set up SD campaigns on our client’s ASINs) or we can employ an offensive/conquest strategy (target after our client’s competitors).  These ads appear to the right or at the bottom of the product information on the product detail page.

an example of a product display ad on an amazon product detail page

Now you know how to advertise on Amazon in 2021. Along with an informed Amazon advertising strategy, you’ll be able to join the masses who are growing their business each year on Amazon’s platform. Here’s a tip – use the Amazon Early Reviewer Program to get ahead of your competition and gain more reviews to help your Amazon PPC efforts!


ready to take the next step?

Take your Amazon business to the next level. Our team of Amazon experts includes ecosystem experts, brand managers, ad strategists, and — most importantly — fellow entrepreneurs that are invested in your company’s success. It only takes a few minutes to chat with us — contact us today and let’s get started!

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