Running ads on a marketplace like Amazon or Bol is one of the fastest ways to increase product visibility and drive sales. But simply switching on a campaign and setting a budget is rarely enough. Without a structured approach to targeting, bidding, and performance tracking, ad spend disappears quickly with little to show for it. Whether you are new to marketplace advertising or looking to sharpen an existing strategy, this guide walks you through the key questions every advertiser should be able to answer.
What is marketplace advertising and how does it work?
Marketplace advertising is a paid visibility system built into platforms like Amazon and Bol that allows sellers to promote their products directly within search results, category pages, and product detail pages. Advertisers bid on keywords or product placements, and the marketplace charges a fee when a shopper clicks on the ad. The most common format is the sponsored product ad, which looks nearly identical to an organic listing.
Unlike traditional display advertising, marketplace ads appear at the moment a shopper is actively searching for a product. This intent-driven context makes them highly effective when campaigns are set up correctly. On Amazon, the core advertising formats include Sponsored Products, Sponsored Brands, and Sponsored Display. Each serves a different purpose: Sponsored Products drive direct sales, Sponsored Brands build brand awareness at the top of search, and Sponsored Display retargets shoppers who have already viewed your product.
The auction model means that the highest bidder does not always win the placement. Relevance, conversion history, and listing quality all influence which ads are shown, which is why optimizing your product detail page is just as important as managing your bids.
Why do marketplace advertising campaigns underperform?
Marketplace advertising campaigns underperform primarily because of poor keyword targeting, weak product listings, and unmanaged bids. When any one of these three elements is misaligned, the campaign either fails to reach the right shoppers or converts too few of the clicks it does attract, resulting in a high Advertising Cost of Sale (ACoS) and a low return on investment.
Several specific issues tend to repeat across underperforming campaigns:
- Broad or irrelevant keyword targeting that attracts clicks from shoppers who were never going to buy
- Weak product listings with poor images, thin descriptions, or missing bullet points that fail to convert traffic into sales
- Default or static bids that are never adjusted based on actual performance data
- No negative keyword list, meaning budget is wasted on searches that consistently fail to convert
- Launching campaigns too early, before the product has enough reviews or a competitive price point
Campaigns also underperform when advertisers treat them as a one-time setup rather than an ongoing process. Marketplace algorithms reward active, well-managed campaigns with better placement over time, so neglect compounds into steadily declining results.
How do you choose the right keywords for marketplace ads?
Choosing the right keywords for marketplace ads starts with understanding the search terms your target shoppers actually use, then grouping those terms by intent and commercial relevance. The best starting point is the marketplace’s own search term reports, which show exactly which queries triggered your ads and which ones led to purchases.
A practical keyword selection process looks like this:
- Start with automatic campaigns to collect real search term data from the marketplace’s own matching algorithm
- Analyze the search term report after two to four weeks to identify which terms drove clicks and conversions
- Move high-performing terms into manual campaigns where you can control bids precisely
- Add non-converting terms as negative keywords to stop wasting budget
- Expand strategically using competitor product names, complementary product searches, and long-tail variations
Match types matter significantly here. Broad match captures the widest audience but generates the most irrelevant traffic. Phrase match balances reach with relevance. Exact match gives you full control and is best used for your top-converting terms. Most experienced advertisers run all three match types simultaneously but allocate the highest bids to exact match on proven keywords.
How do you set and optimize bids on a marketplace?
Setting bids on a marketplace starts with calculating the maximum you can afford to pay per click while still achieving a profitable sale, then adjusting those bids based on actual conversion data. Your starting bid should be based on your target ACoS, your product’s average selling price, and your estimated conversion rate.
A simple formula to guide your starting bid: multiply your product’s selling price by your target ACoS percentage, then multiply that result by your estimated conversion rate. For example, if your product sells for 30 euros, your target ACoS is 20%, and you convert roughly 10% of clicks, your maximum cost-per-click would be around 0.60 euros.
How do you adjust bids over time?
Once campaigns are running, bid optimization becomes a continuous process. Raise bids on keywords that convert well and are generating profitable sales. Lower bids on keywords with high click volume but poor conversion. Pause keywords that have spent significant budget without a single sale. Most platforms also offer automated bid rules or dynamic bidding options that adjust in real time based on the likelihood of conversion, which can be a useful tool once you have enough data to trust the algorithm.
Review bids at least once a week during the first month of a campaign, and at a minimum every two weeks once the campaign has stabilized.
What metrics should you track to improve ad performance?
The most important metrics to track for marketplace ad performance are ACoS, click-through rate (CTR), conversion rate, and total attributed sales. Together, these four indicators tell you whether your ads are reaching the right people, whether your listings are convincing enough to convert, and whether the overall investment is generating a return.
- ACoS (Advertising Cost of Sale): the percentage of ad-attributed revenue spent on advertising. A lower ACoS means more efficient spend. Your target ACoS depends on your margins.
- CTR (Click-Through Rate): the percentage of impressions that result in a click. A low CTR signals that your ad creative, title, or main image is not compelling enough.
- Conversion rate: the percentage of clicks that result in a purchase. A low conversion rate points to issues with your listing, price, or reviews.
- Total attributed sales: the revenue directly linked to your ad campaigns. This gives context to your ACoS and helps you understand the true scale of impact.
Beyond these core metrics, Return on Ad Spend (ROAS) is increasingly used as a complement to ACoS, particularly for brands running multiple product lines. Impression share is also worth monitoring on Amazon to understand how often your ads are winning placements relative to competitors.
How often should you optimize your marketplace campaigns?
Marketplace campaigns should be reviewed and adjusted at least once a week during the first month, and at a minimum every two weeks once they have reached a stable performance baseline. More frequent optimization is not always better. Making changes before a campaign has gathered enough data leads to decisions based on noise rather than meaningful trends.
A useful optimization rhythm looks like this:
- Weekly: review search term reports, add negative keywords, adjust bids on clear outliers
- Bi-weekly: assess overall campaign performance, pause underperforming ad groups, test new keyword groups
- Monthly: evaluate budget allocation across campaigns, review listing quality, reassess target ACoS based on margin changes or seasonal factors
- Quarterly: audit the full campaign structure, assess competitor positioning, plan for upcoming peak periods
In 2026, marketplace algorithms have become increasingly responsive to campaign activity signals. Consistent, structured optimization tends to be rewarded with better placement and lower cost-per-click over time. Campaigns that are left untouched for weeks at a time often see gradual performance erosion, even if nothing obvious appears to have changed.
How Distrilink Helps You Optimize Marketplace Advertising
At Distrilink, we help brands grow quickly and in a controlled way on online marketplaces. Rather than building an entire marketplace team, IT infrastructure, or logistics operation yourself, brands can activate and scale immediately through us. Our approach to marketplace advertising is data-driven and standardized, supported by our own platform and fulfillment capabilities. We take full ownership of operational execution, from campaign activation and ongoing optimization to logistics and customer service. This means brands can expand their e-commerce presence without adding complexity, with speed, control, and clear visibility into their performance.
Specifically, when it comes to advertising campaign optimization, we offer:
- Centralized campaign management across all major European marketplaces through our Distrilink Acceleration Platform
- Keyword research and search term analysis based on real marketplace data, not guesswork
- Ongoing bid management aligned with your margin targets and growth objectives
- Full-funnel optimization combining listing quality, pricing, reviews, and ad spend into one coherent strategy
- Transparent reporting so you always know exactly where your budget is going and what it is delivering
We currently represent more than 25 brands and are connected to all major European marketplaces. If you want to stop guessing and start scaling, get in touch with us to find out how we can take your marketplace advertising to the next level.
Frequently Asked Questions
What is a good ACoS target for marketplace advertising, and does it vary by product type?
A good ACoS target depends entirely on your product's profit margin. As a general rule, your target ACoS should sit below your net margin percentage to ensure profitability — for example, if your margin is 35%, an ACoS below 25–30% leaves room for profit after other costs. However, ACoS targets can vary by goal: a brand launching a new product may accept a higher ACoS temporarily to build sales velocity and reviews, while a mature product with strong organic ranking should aim for a tighter, more profitable ACoS. Always factor in your fulfillment costs, marketplace fees, and return rates before setting a fixed target.
How many campaigns and ad groups should I start with as a beginner?
As a beginner, it is best to start lean and structured rather than launching dozens of campaigns at once. A practical starting setup is one automatic campaign to gather search term data and one or two manual campaigns organized by product category or keyword theme. This keeps your budget focused, makes performance easier to interpret, and gives you clean data to build from. Expand your campaign structure gradually as you identify which keywords and ad groups are driving results, rather than spreading your budget too thin from the start.
What should I fix first — my product listing or my ad campaigns — if both need improvement?
Always fix your product listing first. Driving paid traffic to a listing with poor images, a weak title, thin bullet points, or few reviews is essentially paying for clicks that will not convert, which wastes budget and signals poor performance to the marketplace algorithm. Invest in high-quality main images, keyword-rich titles, and complete product descriptions before activating or scaling any campaigns. A strong listing improves both your conversion rate and your organic ranking, meaning every euro you spend on ads goes further once the foundation is solid.
Can I run marketplace ads effectively with a small daily budget?
Yes, but it requires tighter focus and more patience. With a limited budget, concentrate spend on a small set of highly relevant exact-match keywords rather than broad campaigns that spread budget across hundreds of search terms. Set a realistic daily budget that allows at least 10–20 clicks per day on your key terms so you gather meaningful data within a reasonable timeframe. Avoid the common mistake of setting a very low budget across too many campaigns — it is far more effective to fully fund two or three focused campaigns than to underfund ten.
How do I know if my marketplace ads are cannibalizing my organic sales rather than adding new revenue?
This is one of the most common concerns for established sellers, and the clearest way to assess it is to compare your total sales trend (organic plus paid) against your ad spend over time. If total revenue grows as ad spend increases, your ads are likely generating incremental sales. You can also temporarily reduce bids on specific keywords and monitor whether organic sales fill the gap or total sales drop — this gives a direct read on true incrementality. On Amazon, the Search Query Performance report provides additional visibility into how your brand appears across paid and organic placements for the same search terms.
What are the most common mistakes brands make when scaling marketplace ad spend?
The most frequent mistake is scaling budget before the campaign structure and data are ready for it — increasing spend on campaigns that have not yet proven their keyword efficiency leads to amplified waste rather than amplified results. Other common scaling mistakes include failing to adjust bids upward on winning keywords (causing you to lose placement as competition increases), neglecting to update negative keyword lists as new irrelevant search terms emerge at higher volumes, and not aligning ad spend increases with listing quality and inventory levels. Scale methodically by first confirming a profitable ACoS at your current budget, then increasing spend in increments of 20–30% while monitoring performance closely.
Is it worth advertising on multiple European marketplaces simultaneously, or should I focus on one first?
For most brands, it makes sense to establish a strong, profitable presence on one primary marketplace before expanding to others, since each platform has its own algorithm, audience behavior, and advertising interface that requires dedicated attention. However, if you are working with a partner who manages multi-marketplace operations centrally — as Distrilink does through its Acceleration Platform — simultaneous expansion becomes far more manageable because the operational and advertising complexity is handled for you. The key consideration is whether you have the data, listings, and logistics infrastructure ready to support each additional marketplace before you activate paid campaigns there.
