Targeting, Keywords, and Bidding
Targeting is where intent meets control. On the keyword side, understand match types: exact (tightest control), phrase (order-bound with close variants), and broad (widest reach including related terms). On the product side, understand ASIN and category targeting. Negative keywords and negative product targets protect budget by excluding wasteful traffic. Bidding operates in a second-price-style auction where ad rank depends on bid and relevance, so a higher bid cannot fully compensate for weak relevance or a poor listing.
Core concepts: default bids, placement bid modifiers, dynamic bidding (down-only vs. up-and-down), and the relationship between bid, impression share, and ACOS. Traps: assuming broad match equals exact plus plurals (it reaches far more), confusing phrase and broad behavior, forgetting that negatives can conflict with active targets, and treating the bid as the final CPC (you often pay less). Also know that relevance and conversion history influence placement, and that changing bids too frequently resets learning.
Rule of thumb: start broad or phrase to discover, then harvest to exact; set bids from a target-ACOS calculation rather than gut feel. Worked example: with a $20 product, a 25% target ACOS, and an observed 10% conversion rate, the break-even CPC is price × target ACOS × conversion rate = $20 × 0.25 × 0.10 = $0.50. Bid near that figure and adjust with placement modifiers rather than chasing top-of-search with an unprofitable bid.