How to Budget for Amazon PPC Advertising

A reasonable starting Amazon PPC budget is 8–12% of your target Amazon revenue, with most brands spending $3,000–$15,000/month depending on category competition and growth goals. Don't set your budget based on what you're comfortable spending — set it based on your margin, your category CPCs, and how many profitable keywords you can find.

Article summary

A reasonable starting Amazon PPC budget is 8–12% of your target Amazon revenue, with most brands spending $3,000–$15,000/month depending on category competition and growth goals. Don't set your budget based on what you're comfortable spending — set it based on your margin, your category CPCs, and how many profitable keywords you can find.

The longer answer

Short answer: A reasonable starting Amazon PPC budget is 8–12% of your target Amazon revenue, with most brands spending $3,000–$15,000/month depending on category competition and growth goals. Don't set your budget based on what you're comfortable spending — set it based on your margin, your category CPCs, and how many profitable keywords you can find.

What most people get wrong about this

Budgeting for Amazon PPC isn't about picking a comfortable monthly number. It's about working backward from your unit economics.

What I would actually recommend

Start with your gross margin per unit. Subtract your target profit per unit. What's left is the maximum you can spend on advertising per sale.

About the author

Example: Product sells for $35. Cost of goods is $12. Gross margin is $23 (66%). You want $10 profit per unit. That leaves $13 per unit available for ad spend. If your average conversion rate is 10%, you need 10 clicks per sale. $13 ÷ 10 clicks \= $1.30 maximum CPC.