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Bid optimization explained

Once you enable Smart Bidding on a campaign, SellerJar decides each target's bid for you. This page explains the idea behind those decisions. If ACOS is new to you, read Understanding ACOS first.

Bid to what a click earns​

A click is only worth what it brings back. The number that matters is revenue per click: a target's ad sales divided by the clicks it took to get them. Once you know what a click earns and what ACOS you will accept, the right bid follows:

Ideal bid = revenue per click x effective Target ACOS

A target earning $2.00 per click at a 30% effective target has an ideal bid of $0.60. Paying $0.60 for a click that returns $2.00 lands exactly on a 30% ACOS. SellerJar does not jump the live bid there in one move; it steps toward it a little each day, so one noisy day cannot swing a bid.

Your goal scales the target​

The goal you pick scales your Target ACOS before the formula runs. That scaled number is the effective target, and it is why the same 30% target behaves differently on each goal.

GoalA 30% target optimizes toward
Balanced, Efficiency30%
Launchabout 38%
Liquidate45%
Rank60%

Budget Utilization is the exception: it paces toward a daily budget and is not anchored to ACOS at all. See Smart Bidding for choosing a goal.

What triggers a change​

Each day, every target is checked against a short list of situations and gets the response for the first one that applies:

  • High ACOS: spending above the effective target. The bid steps down toward what the target's results support.
  • High spend, no sale: money spent without an order. The bid is pulled back before the spend gets out of hand.
  • Low ACOS: comfortably under target and leaving sales on the table. On the growth goals the bid is raised a little; Balanced and Efficiency hold.
  • Low visibility: too few clicks to judge. A small raise buys the data. On Launch, new keywords are guided toward Amazon's suggested bid.

Every response runs inside the same limits: bounded daily moves in both directions, ceilings tied to your typical cost per click and your Bid Ceiling setting, and cuts that wait for real evidence. The full list is in Smart Bidding.

Cadence​

Optimization runs automatically against a rolling window of recent performance, and every change is gradual by design. Expect two to three weeks before a goal or target change fully shows up in your numbers.

This is not the Optimize Bids button​

The automatic engine runs on its own on campaigns where Smart Bidding is on. Optimize Bids in the target manager is a separate on-demand tool: you select targets, run it, review the suggested bids and apply the ones you want. The two do not affect each other.

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