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Dynamic Bidding Strategies- Everything You Need to Know


What is Amazon Dynamic Bids

Launched as a part of Amazon’s $15 billion investment into third-party seller tools in 2019, these allow Amazon to adjust your Sponsored Product bid in real-time according to the probability of conversion.

There are three bidding options available:

  • Down only: Your bids will be decreased by a maximum of 100% when it is likely to lose the auction. You consider historical campaign data into account for this.
  • Up and Down:  Amazon will increase or decrease your bid(max by 100% in each case), depending on the competitors’ bids and your higher possibility of winning.
  • Fixed: These bids don’t allow Amazon to alter bids on the likelihood of them converting. It will utilize the exact bid you have set and any other manual adjustments made by you.

How do Dynamic Bids on Amazon Work?

Amazon has access to such a massive amount of data that turns finding the probability of a website visitor clicking your ad and converting a child’s play.

Machine learning analyzes the data on product niche, buyer behavior, previous ad performance, time of day, and all sorts of other data to decide in real-time whether your ad will result in a purchase.

Do Amazon Dynamic Bids Boost Sales?

Well, Amazon believes so. And, here’s something you practically do.

Use Relevant and Profitable Keywords

Use an Amazon keyword tool and reverse ASIN search to find keywords that determine the search results getting targeted in your advertising campaign, directly influencing the amount you need to bid and the chances of conversion. 

Refine Your Listing 

It is undeniable that how your listing presents itself to potential buyers converts them. They click when they take note of the high-resolution product photographs and informative product descriptions. This, in turn, improves your feedback rating on Amazon.

Leverage Amazon Prime

Amazon Prime, with its two-day deliveries at no extra cost, has been impacting customers’ mindset and buying behavior for some time now. Jump on this bandwagon as quickly as you can. Just qualify for Amazon Prime through FBA or Seller Fulfilled Prime and get the blue Prime badge. This badge will allow you to appear in fast shipping-filtered search results.

Plan a Robust Advertising Strategy

Your advertising strategy justifies your bidding tactics. Have your mind set on your business goals and stand by a strategy that you think can influence the turn of events in your favor.

Types of Amazon Dynamic Bid Strategies 

1. Cost reduction

Ideal for newly created advertising campaigns.


  • Involves decreasing your advertising costs while you are just learning about Amazon’s advertising system, trying out keywords, collecting data, and improving your listings.
  • Saves you from overspending on advertising through the option of the ‘Down only’ bids.
  • Allows Amazon’s computers time to collect vital information on your ad’s performance so that it can accurately predict the likelihood of conversion likelihood when you later move to ‘Up and Down’ bids.

2. Sales

Ideal for currently running campaigns that are well-optimized and ready to scale to create a flywheel effect


  • Involves maximizing your ad costs using competent keywords that have been tested and given results.
  • Gives you the best opportunities to increase conversions and expand your brand’s presence on the platform through the option of The ‘Up and Down’ bid 
  • It also allows Amazon to gather data on your ad’s previous performance and predict conversions to increase your chances of achieving success 

3. Impressions

Ideal for launching brand products and creating brand awareness. 


  • Involves maximizing the number of times your potential customers get to see your ad, irrespective of whether they choose to click or not
  • Gives your ads the exposure they deserve in all the relevant searches through the option of a ‘fixed’ bid 

Once you have successfully launched your product or have generated desired brand awareness, you can then always switch to a sales strategy using an ‘Up and Down’ bid.

It is important to remember to never run any of these campaigns together, at the same time, or for the same product because the campaigns will start bidding against each other.

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