Amazon bidding strategies: dynamic bids and placements explained
Your bid isn't always what you pay. Here's what each Sponsored Products bidding strategy does to it, how placements stack on top, and when to use which.
Short answer
Sponsored Products has three campaign bidding strategies. Fixed bids uses your bid as set. Dynamic bids – down only lets Amazon lower your bid when a click looks less likely to convert. Dynamic bids – up and down can also raise it, by up to 100%, when a click looks more likely to convert. Placement adjustments raise your bid by up to 900% for top of search, rest of search or product pages, and they apply on top of the strategy, so a $1.00 bid can become $3.00 or more.
On this page
The three bidding strategies
You set a bidding strategy once per campaign: fixed bids, dynamic bids – down only, or dynamic bids – up and down. It tells Amazon what it may do to every keyword and target bid inside it.
| Strategy | Amazon may | Max on a $1 bid |
|---|---|---|
| Fixed | Leave your bid alone | $1.00 |
| Down only | Lower it when a sale looks unlikely | $1.00 |
| Up and down | Lower it, or raise it when a sale looks likely | $2.00 |
Fixed suits tests and tight margins. Down only is the safe default for new products and discovery campaigns. Up and down is for proven keywords with margin to spare.
Amazon's own guide says up and down can raise bids by up to 100% and tells you to “be prepared to potentially spend double the amount of the bid you input.” Older Amazon guidance capped the increase at 50% outside top of search, so check the console for the current rule in your marketplace.
Placement adjustments: the multiplier on top
Sponsored Products ads show in different places, and they don't perform the same. Placement adjustments let you bid more for specific ones:
| Placement | Where it is | Adjustment |
|---|---|---|
| Top of search | The top row of the first page of search results | 0% to 900% |
| Rest of search | The middle and bottom of search results, and page two onward | 0% to 900% |
| Product pages | Product detail pages and other placements off the search results | 0% to 900% |
Amazon added the rest-of-search adjustment in January 2024, so older guides that mention only two placements are out of date. A 900% adjustment means up to 10 times your bid. You'll almost never want that, but it's there.
The stacking math
Placement adjustments apply to your bid first. The bidding strategy then works on the result. That's how a modest bid turns into an expensive click.
| Step (example) | Bid |
|---|---|
| Your keyword bid | $1.00 |
| Top of search adjustment +50% | $1.50 |
| Up and down raises it up to 100% | up to $3.00 |
The same keyword, with no placement adjustment and down only, never costs more than $1.00. Same keyword, triple the ceiling. Neither setting is wrong. Just know which one you've got before your cost per click surprises you.
Which strategy should you use?
| Situation | Strategy | Placement adjustment |
|---|---|---|
| New product, no conversion data yet | Down only | None until you have data |
| Auto and broad discovery campaigns | Down only | None |
| Proven exact keywords, ACoS well under break-even | Up and down | Small, on the placement that converts best |
| Thin margins, ACoS near break-even | Fixed or down only | None |
| Ranking push with a budget and an end date | Up and down | Top of search |
The rule underneath: only let Amazon raise bids where you can afford the higher click. That means knowing your break-even ACoS first.
Read the placement data before you adjust
Don't guess which placement converts. Pull the Sponsored Products placement report for the last 30 days and compare, per campaign:
- Conversion rate. Top of search often converts better because shoppers see you first. Often, not always.
- Cost per click. Better placements usually cost more. Higher conversion has to outrun higher CPC.
- ACoS. The tiebreaker. Raise the adjustment where ACoS sits under your target; lower it where it doesn't.
Change one thing at a time, wait at least a week of complete data, then look again. Attributed sales keep arriving for days after a click, so the last few days always look worse than they are.
Ask your AI
Show my Sponsored Products performance by placement for the last 30 days, per campaign: spend, clicks, CPC, conversion rate and ACoS. Which campaigns convert best at top of search, and which lose money there?
Connected through WavyCloud, your AI app can pull that report and propose keyword or target bid changes from it. You see a preview of each change and confirm before anything reaches Amazon. Bidding strategy and placement adjustments are campaign settings you change in the Amazon ads console.
Frequently asked questions
What's the difference between dynamic bids down only and up and down?
Both let Amazon lower your bid in real time when a click looks less likely to convert. Up and down also lets Amazon raise your bid, by up to 100% according to Amazon's guide, when a click looks more likely to convert. Down only never pays more than your bid; up and down can pay up to double.
Can Amazon charge more than my bid?
With fixed bids or down only and no placement adjustments, your bid is the ceiling. Placement adjustments raise the bid for that placement by up to 900%, and up and down can raise it further, so your effective maximum can be several times the bid you typed.
Do placement adjustments work with fixed bids?
Yes. Placement adjustments work with all three bidding strategies. With fixed bids, a 50% top of search adjustment turns a $1.00 bid into $1.50 for that placement, and Amazon doesn't change it further.
What's the maximum placement bid adjustment on Amazon?
Up to 900%, or 10 times your bid, for each placement: top of search, rest of search and product pages. Amazon added the rest-of-search adjustment in January 2024.
Which bidding strategy is best for a new product?
Dynamic bids – down only is the common starting point. It keeps cost per click at or under your bid while you collect conversion data. Switch proven keywords to up and down later, once you know they convert at an ACoS below break-even.