To set up Amazon Sponsored Products in 2026, first confirm you hold the Featured Offer, because ads only serve while you own it. Then split campaigns into automatic discovery and manual exact, start new campaigns on dynamic bids down only with a 10 dollar daily budget, harvest search terms that hit 3 or more conversions into exact match each week, cut terms that reach 15 to 20 clicks with zero sales, and account for the AI-generated Sponsored Products prompts that went generally available on March 25, 2026, which auto-enroll your eligible campaigns and charge through your existing cost-per-click bids.
- Ad typeCost-per-click ads on search results and product pages
- Recommended minimum budget10 dollars per day per campaign
- Budget mechanicAveraged over a calendar month, up to 25 percent daily overspend
- Bidding strategiesDynamic down only, up and down, and fixed
- Auto match typesClose, loose, substitutes, complements
- Manual match typesBroad, phrase, exact
- New surfaceAI Sponsored Products prompts, GA March 25, 2026
- Harvest cadenceWeekly search-term review, monthly bid audit
Sponsored Products is still the highest-intent ad format Amazon offers, and it is where most sellers should put their first advertising dollar. But in 2026 it stopped being a flat keyword auction. It became a system gated at both ends, and the order you set things up in now matters more than the bids you choose. This guide walks the full sequence, leading with the failure modes that actually cost real accounts money, with the inline rules we apply on live campaigns.
CH.01What changed in 2026, and the two gates that decide everything
Sponsored Products is a cost-per-click format that places your products inside search results and on product detail pages. That definition has not changed. What changed is that the format is now squeezed by two gates, and a setup that ignores either one will quietly underperform no matter how clean the keyword work is.
The first gate is the Featured Offer. Your ads only serve while you hold the Featured Offer, the position most sellers still call the Buy Box. Lose it and your paid traffic stops the same day, with bids and budgets that look perfectly healthy in the console. This is why eligibility comes before bidding in the steps below, not after.
The second gate is the new auction surface. The auction expanded beyond search results into AI-generated Sponsored Products prompts, which moved from beta to general availability in the U.S. on March 25, 2026. These prompts surface inside shopping results, on product detail pages, and inside the assistant Amazon renamed from Rufus to Alexa for Shopping on May 13, 2026. Eligible campaigns are auto-enrolled with no extra setup and charged through your existing bids, so this surface can consume budget before you have even decided to use it.
CH.02Confirm eligibility and Featured Offer status before you spend a dollar
The single most common reason a Sponsored Products account silently dies is not bad bidding. It is losing the Featured Offer. Spend the first hour confirming you can actually serve before you build anything.
- You have a Professional seller account, the tier required to run Sponsored Products.
- The products you intend to advertise are in new condition and eligible for the Featured Offer.
- You currently hold the Featured Offer on every ASIN you plan to promote.
- Listings are fully indexed, with title, bullets, and images that match the keywords you intend to bid on.
- Account health is clean, so a suppression or policy flag cannot pull your offer mid-flight.
Sponsored Products ads only serve when you hold the Featured Offer. If a competitor undercuts you or you run out of stock, your paid traffic stops that day even though nothing in the campaign settings changed. Set a Featured Offer alert before you set a single bid.
CH.03Set campaign structure, budget, and bidding strategy
With eligibility confirmed, build the spending frame. Two numbers and one strategy decision drive most of week-one behaviour: your daily budget, your starting bid, and which of the three bidding strategies the campaign runs on.
Budget mechanics that catch people out
Amazon recommends a minimum Sponsored Products daily budget of 10 dollars per campaign so each one gathers enough signal to read. The daily budget is averaged over a calendar month, which means a campaign can spend up to 25 percent more than its average daily budget on any given day. A 10 dollar per day budget can therefore spend up to 12.50 dollars in a single day, totalling roughly 300 dollars over the month. Plan around the monthly number, not the daily one.
The three bidding strategies
| Bidding strategy | How Amazon adjusts | Best use | Risk posture |
|---|---|---|---|
| Dynamic bids down only | Lowers your bid when a conversion looks unlikely; never raises it | New campaigns gathering first data | Conservative |
| Dynamic bids up and down | Raises bids up to 100 percent for Top of Search and up to 50 percent for other placements when it predicts a conversion, and lowers them when it does not | Proven campaigns with conversion history | Aggressive |
| Fixed bids | Uses your exact bid with no automatic adjustment | Tightly controlled tests and brand defense | Predictable |
A 0.02 dollar minimum bid and a second-price style auction are widely reported by experienced advertisers, and Amazon's bidding-rules help page is the closest official reference. Treat the exact mechanics as industry knowledge to verify in your own account rather than a fixed published rule.
CH.04Launch an automatic campaign to harvest data
Build the automatic campaign first, because it is your discovery engine. It matches your product to shopper queries and product pages so you learn what actually converts before you commit manual bids. Budget it as a research line item, not a profit centre.
The four automatic match types
| Match type | What it targets | What you learn from it |
|---|---|---|
| Close match | Search terms closely related to your product | Your strongest future exact keywords |
| Loose match | Search terms loosely related to your product | Adjacent demand and negative-keyword candidates |
| Substitutes | Shoppers viewing detail pages of similar products | Competitor ASINs worth targeting later |
| Complements | Shoppers viewing detail pages of complementary products | Cross-sell and bundle opportunities |
CH.05Build manual campaigns from your converters
Manual campaigns are where you take the queries your auto campaign proved and bid on them precisely. This auto-to-manual harvesting loop is the engine of long-term profitability, and the threshold for promotion should be evidence, not optimism.
- Promote proven terms to exactWhen an auto search term reaches 3 or more conversions, move it into a manual exact-match campaign where you can bid it on its own merit.
- Layer broad and phrase for expansionBroad match catches your keyword components in any order, including singulars, plurals, synonyms, and related terms. Phrase match requires all components in the same order. Use these to keep discovering variations around proven roots.
- Set bids to your target ACoSBid each exact keyword to the cost-per-click that keeps it at or below your advertising cost of sales target, then adjust weekly from there.
- Negative the sourceAdd each promoted term as a negative exact in its auto and broad campaigns so the cheaper campaigns stop cannibalizing clicks that belong in your high-intent exact campaign.
Broad match covers keywords in any order plus singulars, plurals, synonyms, and related terms. Phrase match requires all components in the same order. Exact match is word for word, same words and same order. Reserve your highest bids for exact, where intent is clearest.
CH.06Use placement bid adjustments to control where you win
Bidding strategy decides how Amazon flexes your bid. Placement adjustments decide where that bid is allowed to compete hardest. The two layer on top of each other, so read the placement report before you touch either.
- Top of Search is usually the highest-converting and most expensive placement. Add a placement multiplier here only once the placement report proves it converts for you.
- Rest of Search and Product pages each behave differently by product and category. Judge them on their own conversion data, not on a blanket rule.
- Remember that a Top of Search placement multiplier compounds with dynamic bids up and down, which can already raise that placement by up to 100 percent. Stacking both aggressively on an unproven keyword is the fastest way to overspend.
Bidding is the only lever that touches every metric at once. Change one thing at a time, layer placement on top of strategy deliberately, and give it a full week before you judge it. Capconvert Paid Media playbook
CH.07Optimize with the search-term report and negative keywords
Once campaigns have a click base, optimization becomes a recursive prune-and-promote loop driven by the search-term report. Pull 60 to 90 days of data so the patterns are real, then run the same rules every week.
- A term with 3 or more conversions at or below target ACoS gets promoted to exact match.
- A term with 15 to 20 or more clicks and zero sales gets added as a negative to stop the bleed.
- A keyword converting below target ACoS earns a small bid increase to win more impressions.
- A keyword converting above target ACoS gets a small bid cut and a re-check next week.
- A whole ad group running over target sends you to the listing first, because ad spend cannot fix a weak product page.
ACoS measures ad spend against ad-attributed sales. TACoS, total advertising cost of sales, measures ad spend against total sales including organic. Watch ACoS to steer individual keywords and watch TACoS to know whether your ads are lifting the whole account. Tighten both as a product matures and organic rank grows.
CH.08Win the new surfaces, and keep the right calls human
The last step is the one most 2026 guides skip: the auction now extends into AI surfaces and an AI-assisted setup layer, and both reward content and judgment rather than bid mechanics alone.
Sponsored Products prompts and the assistant rename
AI-generated Sponsored Products and Sponsored Brands prompts, contextual product question-and-answer surfaced in shopping results, on product detail pages, and inside the AI assistant, moved to general availability in the U.S. on March 25, 2026. Eligible campaigns are automatically enrolled with no extra setup and charged through your existing cost-per-click bidding, with prompt-level reporting for impressions, clicks, clickthrough rate, cost-per-click, spend, sales, ACoS, ROAS, and 7-day orders and units. Because prompts pull from your listing and Brand Store content, the way to earn them is to make that content answer real buyer questions clearly.
Amazon's AI shopping assistant, formerly Rufus, was renamed Alexa for Shopping on May 13, 2026. It runs on Amazon Bedrock using Anthropic's Claude, Amazon Nova, and a custom model, and Amazon reports that customers who use it while shopping are 60 percent more likely to make a purchase. Treat that figure as Amazon's own claim.
Sponsored Products video
Video is a high-converting addition once your text campaigns are stable. You can upload 1 to 5 product feature videos per ASIN within an ad group, with a maximum of 3 thumbnails shown at once. Videos must be 7 seconds or longer, MP4 or MOV, with 1920 by 1080 at 16 by 9 recommended, under 500 MB, and feature titles up to 3 words or 15 characters with optional descriptions up to 6 words or 55 characters.
The 2026 AI-assisted setup layer
At unBoxed 2025 in Nashville, Amazon announced a unified Campaign Manager that combines the Ads console and Amazon DSP, which it cites as enabling about 67 percent faster campaign launches, alongside Ads Agent for AI keyword and audience recommendations during setup and Creative Agent for autonomous ad creative. Treat the 67 percent figure as Amazon's marketing claim, not a guaranteed result.
- Delegate to AI: first-draft keyword and audience suggestions, creative variations, and routine bid nudges within rules you set.
- Keep human: Featured Offer health, negative-keyword judgment, and your target-ACoS setting, because these decisions carry the most risk and the least tolerance for an automated misread.
From here the loop repeats. Discover with auto, prove in exact, prune by search term, optimize by ACoS, and extend into prompts and video while you defend the Featured Offer that makes any of it possible. For the upstream decision of whether Amazon Ads belongs in your mix at all, see our guide on when to invest in Amazon Ads beyond Google Shopping. To earn placement in the AI-prompt surface organically, pair this with our post on ASIN visibility inside Amazon's AI assistant, and feed the harvesting steps with the organic query data in our 2026 Search Query Performance guide.
FAQCommon questions
What is the difference between automatic and manual targeting, and should I run both?
Automatic targeting lets Amazon match your product to queries and ASINs across four match types: close match, loose match, substitutes, and complements. Manual targeting uses keywords you choose in broad, phrase, or exact match, or specific product and category targets. Run both. The automatic campaign is your permanent discovery engine, and the manual exact campaign is where you bid precisely on the converters it surfaces.
Which bidding strategy should a new campaign use, down only, up and down, or fixed?
Start new campaigns on dynamic bids down only. It lowers your bid when a conversion looks unlikely and never raises it, which protects an unproven keyword while it gathers data. Graduate a campaign to dynamic bids up and down only after it has conversion history, knowing Amazon can then raise bids up to 100 percent for Top of Search and up to 50 percent for other placements. Reserve fixed bids for tightly controlled tests.
Why did my Sponsored Products ads stop showing even though my budget and bids are fine?
The most common cause is losing the Featured Offer. Sponsored Products ads only serve while you hold the Featured Offer, the position many sellers call the Buy Box. If a competitor undercuts your price, you run low on stock, or an account-health flag suppresses the listing, your paid traffic can stop the same day while the campaign settings still look healthy. Check Featured Offer status first.
What is a good ACoS for Sponsored Products in 2026, and how is it different from TACoS?
A good ACoS is any figure below your break-even ACoS, which is your profit margin before ad cost. ACoS measures ad spend against ad-attributed sales, so it steers individual keywords. TACoS measures ad spend against total sales including organic, so it tells you whether advertising is lifting the whole account. New products often run a higher ACoS during launch to build rank, then tighten both numbers as organic sales grow.
What are Sponsored Products prompts and do I have to pay for them?
Sponsored Products prompts are AI-generated, contextual product question-and-answer placements that surface in shopping results, on product detail pages, and inside Amazon's AI assistant, now called Alexa for Shopping. They moved to general availability in the U.S. on March 25, 2026. Eligible campaigns are automatically enrolled with no extra setup and charged through your existing cost-per-click bids, so yes, you pay for them through the same budget, with separate prompt-level reporting available.
How do I find and add negative keywords from the search-term report?
Pull the search-term report for your automatic and broad campaigns over 60 to 90 days. Any term that has reached 15 to 20 or more clicks with zero sales is a negative-keyword candidate. Add it as a negative exact in the campaign where it spent. Also add every keyword you have promoted to exact match as a negative in its source auto and broad campaigns, so the cheaper campaigns stop competing for clicks that belong in your high-intent exact campaign.
References
- Amazon Ads. "A guide to targeting with Sponsored Products." advertising.amazon.com/library/guides/targeting-with-sponsored-products
- Amazon Ads. "Guide to dynamic bidding, up and down with Sponsored Products." advertising.amazon.com/library/guides/dynamic-bidding-sponsored-products
- Amazon Ads. "Sponsored Products budget basics and best practices." advertising.amazon.com/library/guides/sponsored-products-budget-best-practices
- Amazon Ads. "Sponsored Products and Sponsored Brands prompts, unBoxed 2025 GA announcement." advertising.amazon.com/en-us/resources/whats-new/unboxed-2025-sponsored-products-and-sponsored-brands-prompts
- Amazon Ads. "unBoxed 2025 keynote recap." advertising.amazon.com/library/news/unboxed-2025-recap
- Amazon Ads. "A complete guide to setting up Sponsored Products video." advertising.amazon.com/library/guides/sponsored-products-video
- About Amazon. "Amazon's AI shopping assistant gets smarter, Rufus renamed Alexa for Shopping." aboutamazon.com/news/retail/amazon-rufus-ai-assistant-personalized-shopping-features