The average ACOS on Amazon in 2025 was 30.20 percent. For many sellers and vendors, this means advertising costs eat a significant chunk of their margin. At the same time, the average CPC has risen to $1.12, up 15.5 percent year over year. The good news: with the right levers, you can significantly reduce your ACOS without losing visibility. In this article, we show you seven proven strategies that our clients use to make their campaigns more profitable.
1. Restructure Your Campaigns
Campaign structure is the foundation of every successful PPC strategy. Too many sellers work with one or two bulk campaigns where hundreds of keywords target different products. The result: the algorithm cannot optimize cleanly, and you lose control over budgets and bids.
A concrete example from our practice: a mid-size brand reduced their ACOS by 25 percent by splitting one bulk campaign into six segmented campaigns. The segmentation was based on match type, performance level, and product group. This allowed more precise bid management and targeted budget allocation.
The ideal campaign structure consists of three tiers:
- Exact match campaigns: For your top keywords with the highest conversion rate. This is where you invest the highest bids
- Phrase match campaigns: For keywords in the evaluation phase that have shown potential but are not yet top performers
- Broad and auto campaigns: As a discovery engine for new keywords. Low budget, regular harvesting
2. Systematize Keyword Harvesting
Keyword harvesting is the process of identifying profitable search terms from auto and broad campaigns and transferring them to more precise campaigns. Many sellers perform this process sporadically or not at all, causing budget to leak into non-converting search terms.
Here is how effective harvesting works: analyze the search term reports of your auto and broad campaigns weekly. Look for terms with at least three conversions and an ACOS below your target. Transfer these terms as exact match to your manual campaigns. In return, add the term as a negative keyword in the source campaign to avoid duplicate spending.
This cycle ensures your ad budget continuously flows toward the most profitable search terms while new opportunities continue to be discovered.
3. Deploy Negative Keywords Strategically
Negative keywords are one of the most underrated levers for lowering ACOS. Every click on an irrelevant search term costs you money without generating a conversion. In practice, we regularly see accounts where 20 to 30 percent of the budget disappears into non-converting terms.
On Amazon, only two match types are available for negative keywords: Phrase Match and Exact Match. There is no negative Broad Match. This means you need to be precise when maintaining your negative keywords.
Use negative exact match to exclude specific terms that demonstrably do not convert. Negative phrase match is suited for blocking entire topic areas. Example: if you sell premium products, exclude phrases like "cheap", "budget", or "under 10 dollars."
Create a central negative keyword list at the account level and review it at least every two weeks. This prevents budget from being wasted on irrelevant clicks.
4. Optimize Bid Strategy
Your bid strategy has a direct impact on your ACOS. Bids that are too high mean unnecessary cost per click; bids that are too low lead to insufficient visibility. The art lies in data-driven calibration.
Calculate the maximum CPC you can afford for each keyword: product price times target ACOS times conversion rate. A product with a 30 euro sale price, a target ACOS of 25 percent, and a conversion rate of 10 percent yields a maximum CPC of 0.75 euros.
Do not adjust bids across the board. Differentiate by performance tier. Top keywords with high conversion rates receive higher bids, while long-tail keywords with lower volume can run profitably with lower bids. Use the bid adjustments in Amazon's campaign manager to control bids at the placement level.
5. Leverage Dayparting
Not every hour of the day converts equally well. Conversion rates swing up to 300 percent between peak and off-peak times. Running your campaigns around the clock with the same bid wastes money during low-converting hours and misses opportunities during peak times.
Dayparting means adjusting your bids and budgets to the times of day when your target audience is most active. The data shows that sellers who implement consistent dayparting achieve an average 51 percent increase in profitability.
Analyze your campaign data over at least four weeks by hour and day of week. Identify your best conversion windows and increase bids during those periods. During weak times, typically late evening and early morning, reduce bids or pause campaigns entirely. Amazon does not natively offer dayparting, but tools like our ROI calculator help you identify the optimal time windows.
6. Placement Optimization
Amazon offers different placements for Sponsored Products ads: Top of Search, Rest of Search, and Product Pages. Performance varies significantly between these placements. Top of Search ads deliver two to three times higher click-through rates than other placements, leading to more traffic and potentially better conversion rates.
With placement bid multipliers, you can increase bids for specific placements by 0 to 900 percent. This allows you to invest specifically in the placements that perform best for your product.
Our recommendation: analyze the placement reports in your campaign dashboard. If Top of Search shows a significantly lower ACOS than other placements, increase the multiplier gradually. Start at 50 percent and increase in 25 percent increments as long as the ACOS stays within your target corridor.
7. Optimize Conversion Rate
The conversion rate is the other side of the ACOS equation. Every improvement in conversion rate directly lowers your ACOS because you generate more revenue from the same click costs.
Key levers for a higher conversion rate:
- Optimize main image: The main image is the most important click driver. Professional product photos on a white background with clear product presentation
- Title and bullet points: Clear benefit communication instead of keyword stuffing. Answer the most important buyer questions
- A+ Content: Use A+ Content for brand building and conversion uplift. According to Amazon data, A+ Content increases conversion rates by 3 to 10 percent
- Reviews: Products with more and better reviews convert significantly better. Use Amazon Vine and Request a Review systematically
- Pricing strategy: Price must be competitive in the context of competitors. Regularly check if your price-performance ratio is right
Find more on listing optimization in our listing optimization checklist.
Conclusion: Lowering ACOS Is a Continuous Process
Sustainably lowering your ACOS does not require a single measure but rather the interplay of all seven strategies. Start with campaign structure as the foundation, implement systematic keyword harvesting and negative keywords, then optimize bids, dayparting, and placements. In parallel, work on the conversion rate of your listings.
If you want a detailed analysis of your ACOS and concrete action steps for your account, check out our ACOS vs. TACOS guide or speak directly with our PPC team.