# What are Amazon Sponsored Products?

> Amazon Sponsored Products are pay-per-click ads for single product listings. How they work, how you pay, automatic vs manual targeting and a worked ACOS example.
- **Author**: Marxx
- **Published**: 2026-11-12
- **Category**: Platforms
- **URL**: https://marxx.ai/library-glossary/amazon-sponsored-products

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Amazon Sponsored Products are pay-per-click ads that promote single product listings on Amazon. You pay only when a shopper clicks. You set a maximum bid for each click and a daily budget that caps your spend ([Amazon Ads](https://advertising.amazon.com/solutions/products/sponsored-products), checked 2026-10-20).

## Where they show

Amazon says the ads appear above, beside or within shopping results, and on product detail pages. They can also run on Amazon-owned sites and some other destinations. Amazon lists India among the countries where Sponsored Products are available.

## Two ways to target

| | Automatic | Manual |
|---|---|---|
| Who picks the targets | Amazon, from your listing | You, by keyword or product |
| Control | Low | High |
| Good for | Getting started | Scaling what works |

Amazon calls automatic targeting the easiest and quickest way to start. It offers four match types: close match, loose match, substitutes and complements ([Amazon Ads](https://advertising.amazon.com/library/guides/sponsored-products-best-practices), checked 2026-10-20).

## The metric to know: ACOS

Amazon defines ACOS (advertising cost of sales) like this, and says ROAS is its inverse ([Amazon Ads](https://advertising.amazon.com/library/guides/acos-advertising-cost-of-sales), checked 2026-10-20).

**ACOS = ad spend / ad revenue x 100**

## A worked example

Say you spend INR 20,000 in a week on Sponsored Products. Your ads bring INR 80,000 in sales.

- ACOS = 20,000 / 80,000 x 100 = **25%**
- ROAS = 80,000 / 20,000 = **4**

Say your gross margin is 30%. The sales leave INR 24,000 of gross profit. Take away the INR 20,000 ad bill and you keep INR 4,000.

Your break-even ACOS equals your gross margin. At a 30% margin, an ACOS above 30% loses money before other costs. See [break-even ROAS](/glossary/break-even-roas) for the same idea from the other side, and [ROAS](/glossary/roas) for the full formula.

## How to improve results

1. Start with automatic targeting, then find your best search terms in the report.
2. Move those terms into a manual campaign and bid on them directly.
3. Cut targets that spend but never sell.
4. Watch [cost per click](/glossary/cpc). A high CPC with a low sales rate pushes ACOS up.

## FAQ

### How much do Sponsored Products cost?

You set your own bid per click and a daily budget. Amazon's page says there are no monthly or upfront fees.

### What is a good ACOS?

One at or below your break-even ACOS. That depends on your margin, so work it out before you read any average.

### Is ACOS the same as ROAS?

No, but they use the same figures. ACOS is spend divided by sales, as a percentage. ROAS is sales divided by spend, so a 25% ACOS is a ROAS of 4.

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