SP - Sponsored Products

 Sponsored Products are Amazon’s core advertising format, used to drive discoverability and conversions for specific ASINs.
These ads appear across search results, competitor listings, and shopping recommendations, helping brands capture high-intent shoppers who are actively searching for similar products.

How It Works:

1. Campaign Setup: Advertisers choose ASINs to promote, define targeting (automatic or manual), and set a bid per click.
2. Ad Placement: Ads appear in key locations - including top of search results, mid-page, and product detail pages.
3. Payment Model: Advertisers are charged only when users click on the ad (CPC).

Targeting Types:

• Automatic Targeting: Amazon’s algorithm selects relevant keywords and placements.
• Manual Targeting: Advertisers choose specific keywords, products, or categories.
• Product Targeting: Ads show up on related ASIN pages to cross-sell or compete.

Key Metrics:

• Impressions: Number of times the ad was displayed.
• CTR (Click-Through Rate): % of impressions that resulted in clicks.
• CPC (Cost per Click): Average cost paid for each click.
• ROAS (Return on Ad Spend): Ad revenue ÷ Ad spend × 100.
• Conversion Rate: % of clicks that led to a purchase.

Benefits for Vendors and Sellers:

• Boosts ASIN visibility and sales velocity.
• Helps new listings gain organic ranking faster.
• Offers keyword-level data to improve SEO and content.
• Complements brand-building and top-of-funnel ads.

Benefits for Amazon:

• Increases advertising revenue.
• Improves product relevance and customer shopping experience.
• Supports overall marketplace growth by rewarding performance-based ads.

Challenges:

• High competition in saturated categories can raise CPC.
• Poorly optimised listings may waste ad spend.
• Performance requires ongoing bid and keyword management.

Example:
A seller runs a Sponsored Products campaign for a stainless steel water bottle.
After one month:

• Impressions: 50,000
• Clicks: 2,000
• CPC: $0.60
• Ad Spend: $1,200
• Ad Revenue: $6,000

Calculation:

ROAS=Ad Revenue / Ad Spend ​=6,000​ / 1,200 =5.0

That means the campaign generated $5 in sales for every $1 spent on advertising, or a ROAS of 500%.

Why It Matters:
SP ads are the foundation of Amazon’s advertising ecosystem, directly linking visibility to measurable sales performance.
They are essential for launching new ASINs, defending keyword share, and scaling category presence.

In short:
SP (Sponsored Products) are pay-per-click ads that promote individual ASINs in Amazon search results and product pages, designed to increase visibility, drive traffic, and generate sales.