20 January 2025
Amazon Click Through Rate: How Sellers can Boost CTR (2025)
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Mastering Amazon ads that can really boost your FBA business. But here is the deal: you can’t just toss cash at ads and wish for good results. Trust me, many of us have been there and found that out the tough way! To understand how they are doing, many Amazon Sellers want an answer to the question: How Much Are Amazon Ads? Read on to get a complete breakdown of Amazon Advertising Cost in 2025.
I will specifically share the average cost of Amazon’s main ad formats: Sponsored Products, Sponsored Brands and Sponsored Display ads. I’ll also share some tips on how to interpret these costs and why it is important to look beyond just CPC (cost-per-click), or monthly ad spend to optimize your Amazon advertising.
Article Contents
Like most online advertising platforms, Amazon Ads also uses Cost-per-click (CPC) as basic bidding metric, it showcases how much advertisers pay each time when users click on their ad. As a result, it is important to master CPC bidding for the purpose of developing a successful advertising strategy because it can directly affect campaign budgets, profitability and ROAS (return on ad spend).
As of 2025, the average cost-per-click (CPC) for Amazon ads falls within the range of $0.71 to $1.20, depending on product category, keyword competition, and seasonality. In highly competitive categories like electronics the CPC can rise even further, while niche or less competitive categories usually have lower CPC rates. E.g. According to industry research by Sellics, the average CPC is $0.85 for category ‘health and personal care’, while categories like ‘electronics’ and ‘home improvement’ have rates of about $1.50.
Amazon Sponsored Products Ads are best suited when the goal is to drive conversions directly to product listings.
Average CPC in 2025 is between $0.81 – $1.30 (varies significantly depending on keyword’s competition level). Overall the CPC of sponsored products ads are often lower than the CPCs of other ad formats – however they can go up a lot when bidding on highly competitive keywords. To prevent this, target “long-tail keywords” (more on this later).
Amazon Sponsored Brand Ads come with more creative flexibility and display a seller’s custom headline, logo, and up to three products.
Amazon Sponsored Display Ads allow Sellers to target shoppers based on audience interests and shopping behaviors (both on and off Amazon).
The average CPC of sponsored display ads in 2025 is between $0.80 – $1.60. Unlike Sponsored Products or Sponsored Brands, Sponsored Display Ads can also operate on a Cost-Per-Mille (CPM) basis. Sellers pay for every 1,000 impressions rather than clicks, making it suitable for brand-building campaigns. Average CPM rates for Sponsored Display range from $4 to $12, depending on targeting criteria and placement.
Creative requirements: Require engaging visuals, such as static images and lifestyle photos. To further elevate ad performance, you can also use video content (optional). Creative assets can cost an additional $300 to $3,000, depending on complexity.
While both Sponsored Brands and Sponsored Display fall into Display Ads category, they are quite distinct due to placements, targeting methods and with regard to Amazon advertising cost.
Ad Format | Average CPC/CPM (2025) | Additional Costs | Best Use Cases |
Sponsored Brands | CPC: $1.10–$2.50 | Creative assets: $500–$5,000 for logos/videos | Multi-product promotion, brand awareness |
Sponsored Display | CPC: $0.80–$1.60CPM: $4–$12 | Creative assets: $300–$3,000 | Retargeting, audience-based targeting |
High demand industries usually draw more competition, hence the high CPC rates. Since many sellers are vying for attention, keywords such as ‘wireless headphones’ or ‘ergonomic office chairs’ have high CPCs.
Major shopping events including Black Friday, Cyber Monday and Prime Day increase the CPC. This is because advertisers increase their bid to capture the intended buyers in these periods. This is in anticipation of increased platform usage and sales opportunities. Amazon Advertising data shows that the CPC for holiday related keywords like “Christmas decorations” can rise by more than 30%. So sales events are a key driver of Amazon advertising cost increases.
Amazon offers manual and automated bidding methods and the two have different effects on the CPC outcome. Automated bidding uses a machine learning algorithm to set your bid based on your campaign goals, while manual bidding allows you to control the cost. Using automatic bidding can expose Amazon advertisers to unexpected CPC hikes and in many cases manual bid strategies are the better way to go as they offer more control. You can find a detailed discussion on this topic in our blog post on Manual PPC or Automated PPC.
Advertisers have to pay more for the space at the top of the search results for sponsored ads and hence these have higher CPC. This is because the expected CTR is higher and thus ads ranking in higher positions will generate more sales and thus demand higher CPCs. Amazon states that ads in premium placements receive 2x higher click through rates as opposed to those in lower positions.
A major factor that impacts CPCs is the price at which a product sells. That is because most advertisers will calculate the maximum price they are willing to pay for a click as a percentage of the revenue an item generates. That is why on average, the CPC of expensive items are higher than the CPCs of lower priced items.
Advertising budget for Amazon FBA businesses ranges from tens to hundreds of thousands dollars annually, depending on the size of the business, sales goals, and how competitive the product category is. These benchmarks are important for sellers to know in order to spend their resources wisely and get a good return on investment (ROI).
If you are new to FBA and you can start with more conservative budgets to try to test the waters and identify effective campaign budgets. Focus by allocating budget to keywords that will likely have the most immediate impact on sales. Concentrate on spending on Sponsored Products Ads and if you have enough traffic on your product listings, test Sponsored Display Ads for retargeting campaigns (this will however only work if you already have a lot of people visiting your Amazon Listings).
Word of advice: If you spend too little on Amazon ads, you will also get limited data. You will end up with just a few clicks and it will be difficult to draw statistically viable conclusions from your first attempt at running ads. Thus spending too little almost always leads to failure as clicks are too random and conversions really depend on whether you got lucky or not.
This is for Sellers who already have an established customer base and are trying to scale their operations and to run ads across the entire Amazon marketing funnel. Their objective is to increase market share by expanding various ad campaigns across multiple placements.
In this phase, while the majority of your budget is still going into Sponsored Products ads, you are also tapping into Sponsored Brands ads with better, custom creatives and you can definitely leverage Sponsored Display ads to build brand awareness and retarget valuable users.
Enterprise sellers which include large brands with significant revenue streams. For brands in this category it’s key to defend top ad placements to maintain top-of-mind awareness with push for aggressive growth. Besides scaling Amazon Ads, you will likely also look for ways to drive external traffic to your Amazon listings by leveraging Google Ads for Amazon Listings. More on this in our blog post on How to drive external traffic to Amazon.
ACoS stands for Advertising Cost of Sale as is Amazon’s way to measure ROI. It basically shares the same idea of cost revenue radio, which allows you to measure the efficiency of advertisers’ ad spend.
ACoS Formula and calculation: (Ad Spend ÷ Revenue from Ads) × 100
Understanding what your ACoS is, is significantly more meaningful than just looking at total ad spend, or Amazon CPCs. If your ads are highly profitable, CPCs really lose meaning and can be regarded as a filter metric, rather than a KPI. To know where you stand, check out this blog post on: What is a good ACoS on Amazon.
Controlling the cost of Amazon advertising is necessary for efficiency and optimization. Since costs such as CPC (Cost Per Click) are influenced by competition, yet are under control of the sellers in terms of how effectively their budget is being spent, there are strategies that can be employed to reduce advertising costs without compromising campaign effectiveness.
Negative keyword management
Negative keywords prevent ads from being displayed for irrelevant searches, brand safety concern and low converting keywords, only spend on desired/converting keywords.
Example: If you sell high-end leather wallets, adding “cheap” as a negative keyword ensures your ad doesn’t show for searches like “cheap wallets.” A study by Sellics found that using negative keywords can reduce wasted ad spend by up to 30% in competitive categories. More on this in our guide on managing Negative Keywords Amazon.
Product Listing Optimization
A well-optimized product listing enhances relevance and improves click-through rates and conversion rates. As a first step, make sure high-volume, relevant keywords are in titles and bullet points and use high-quality images to provide users with all information they need to make a purchase. According to Amazon data, enhanced content increases purchase likelihood by 5%–10%. Also consider adding Amazon A+ Premium Content. If you need help with this refer to our Amazon Listing Optimization Services.
Strategic Bid Adjustments
Be sure to set CPCs that make commercial sense given the sales price of your products. Also experiment with bid adjustments based on factors such as day or the week, hour of the day and so on. Tweaking bids is one of the easiest ways to directly improve the profitability of your ads – and one of the reasons why we have developed our own proprietary Amazon PPC Software.
Target Long-tail Keywords
Long-tail keywords are keywords or keyphrases that are more specific. Because it’s usually longer than more commonly used keywords, they are less competitive and generally have lower CPCs while maintaining relevance. Instead of targeting “laptop bag,” use “durable waterproof laptop bag 15-inch.”
Campaign Performance Monitoring
Review campaign performance on a regular basis to make sure you identify underperforming ads in time and adjust strategies accordingly. Sellers, who conduct weekly campaign reviews achieved an average 15% improvement in ad efficiency.
To manage Amazon Ad cost more efficiently, consider using some 3rd party tools to help leveraging campaign insight as much as possible. These tools allow sellers to keep an eye on performance, tweak bids, and find areas to cut costs.
For more inspiration check out this comprehensive review of Amazon PPC Tools.
While Amazon advertising costs can range from $500 to $20K+ per month, with the right strategies, it is totally possible to maximize ROI when budget is limited or maintain ROI target when scaling up. If you’re new to FBA business, I hope this article gives you enough information to start with, and if you’ve already started with Amazon ads, I hope it also give you a better picture of how by further utilizing external tools, can better understand CPC trends, keywords relevance, and resource allocation. With these elements in place, I am confident you’ll be well-positioned to expand your market presence while maintaining healthy profit margins. If you need more support, do not hesitate to enquire about our Amazon Advertising Management and Amazon Product Ads Management services.