Sponsored Products is Amazon's cost-per-click advertising format for individual product listings. An advertiser selects items it sells, chooses the keywords or products it wants to appear against, and bids for space among shopping results and on product detail pages. The ad mirrors an organic listing - image, title, price, rating - plus a small "Sponsored" label, and a click leads to the product's detail page on Amazon. The format exists because a marketplace carrying millions of competing offers cannot show all of them on the first screen, and the retailer can charge for the difference.

The phrase has also become a generic label. Walmart, Target, Kroger and European grocers sell near-identical units, and IAB Europe's harmonised definitions of March 2025 list Sponsored Products as a standard form of onsite retail media. Amazon's product remains the reference point here.

How the auction runs

According to Amazon Ads, the format is open to professional sellers, vendors, book vendors, Kindle Direct Publishing (KDP) authors and agencies, and an item must hold the Featured Offer, the default offer on its detail page, to be advertised. Adult, used and refurbished goods are excluded, along with closed categories. As of September 2026 Amazon lists 23 marketplaces, from Canada to South Africa.

Targeting is fixed when a campaign is created. Automatic targeting hands matching to Amazon through four groups: close match, loose match, substitutes and complements. Manual targeting comes in two forms. Keyword targeting offers broad, phrase and exact match, with each keyword capped at 10 words and 80 characters. Product targeting names individual items by their Amazon Standard Identification Number (ASIN), or whole categories refined by brand, price, rating or Prime eligibility. Negative keywords and negative ASINs remove traffic.

When a shopper searches, eligible ads enter an auction. The bid is the most an advertiser will pay per click, but it does not settle rank on its own: Amazon weighs predicted relevance too, and serves the ad only while the item is in stock. In its 2026 response to regulators, the company said the mean winning bid ranked around twelfth by amount, a measure of how much relevance reorders the queue.

Pricing is the contested part. Amazon has described its sponsored ads since at least 2014 as a generalised second-price (GSP) auction, in which a winner pays roughly what was needed to beat the runner-up rather than its full bid, a description now tested in federal court.

Budgets are set per day but behave monthly. Amazon's documentation gives the example of a $100 daily budget buying up to $3,100 of clicks in a 31-day month,, and spend is not paced through the day.

Bids, placements and a worked example

Three bidding strategies sit on top of the base bid. Dynamic bids - down only cuts the bid in real time when a click looks unlikely to convert, and is the default for new campaigns, according to agency MB Adv. Dynamic bids - up and downcan also raise it. Amazon's current guide sets that rise at up to 100% for all placements; earlier versions allowed 100% at the top of search and 50% elsewhere, according to WTM Digital. Fixed bids use the exact amount entered.

Placement adjustments are a separate lever, applied at campaign level. An advertiser can lift the base bid by up to 900% for top of search, rest of search and product pages, the rest-of-search control having arrived after the other two. The percentage is added to the base bid: according to Seller Labs, a $1.00 bid with a 50% top-of-search adjustment becomes up to $1.50 in that slot. Stacked to the ceiling, a $1.00 bid with a 900% adjustment and up-and-down bidding resolves to a theoretical $20.00 per click, according to MB Adv.

Buyers are marketplace sellers, brand e-commerce teams and specialist agencies, often working through the Amazon Ads application programming interface (API). On its own store the sell side is Amazon alone: it owns the inventory, runs the auction and reports the outcome.

Beyond the search page

The label now covers placements far from Amazon's search box. In October 2023 Amazon began serving Sponsored Products on third-party apps and sites, starting with Pinterest, BuzzFeed, Hearst Newspapers, Raptive and Ziff Davis titles. Off Amazon, maximum bids and dynamic strategies still apply, but top-of-search and product-page adjustments do not; the default setting, Increase reach, can be switched to Limit off-Amazon spend. US advertisers gained an Off-Amazon ad serving column in bulksheets on June 8, 2026.

The unit has changed shape too. Sponsored Products video arrived on November 11, 2025, allowing one to five feature videos per product. Prompts inside the Rufus shopping assistant entered free open beta the same day and became billable under existing cost-per-click bids in the United States on March 25, 2026, with no separate bid.

Origin and evolution

Launch dates vary by source. Most trade histories place Amazon's self-serve cost-per-click business in 2012 under Amazon Marketing Services (AMS), which agency Omnitail says opened to vendors only; Triton Marketing dates AMS to 2015, and the Center for Journalism and Liberty says sponsored listings date to 2008.

Naming settled in September 2018, when Amazon retired AMS, the Amazon Advertising Platform and Amazon Media Group in favour of a single Amazon Advertising brand and renamed Headline Search Ads as Sponsored Brands. The shorter Amazon Ads name followed in 2021, according to MediaPost.

Standards lagged the money by roughly a decade. A sponsored product is assembled by the retailer from its catalogue feed rather than supplied as finished creative, which kept the format outside standard real-time bidding. On January 24, 2025, IAB Tech Lab finalised an OpenRTB extension adding a prodfeed object to the bid request, carrying the feed owner's domain and arrays of allowed and blocked products, alongside data type 13, Product ID, in the Native Ads API. Pentaleap and Teads announced the first real-time bidding integration for onsite sponsored products on July 24, 2025, with Andreas Reiffen, Pentaleap's chief executive, saying retailers "can now run SPAs via RTB for the first time ever".

Amazon also started exporting the machinery. Retail Ad Service launched at CES on January 9, 2025, letting other retailers run sponsored products on Amazon's technology, and Macy's Media Network adopted it in November 2025.

Why it matters

Scale explains the attention. Amazon's advertising services segment crossed $70 billion on a trailing twelve-month basiswith its first-quarter 2026 results, and second-quarter revenue reached $19.8 billion, up 26%, with chief executive Andy Jassy naming Sponsored Products the largest offering. Walmart Connect, the closest American rival, grew 41% as Walmart's ad business neared $6.4 billion.

Supply is widening across retailers too. Pentaleap's benchmark of 12 US networks found sponsored product coverage up 7% year on year in the second half of 2025, with CVS and Macy's placing ads across all ten grid positions.

For marketing teams the format sits between disciplines: bought like search, often funded from trade budgets, and judged on advertising cost of sales (ACoS), ad spend divided by attributed revenue, with every input reported by the party selling the media.

Limitations and disputes

Auction transparency is the sharpest dispute. The Federal Trade Commission (FTC) and 22 states sued Amazon on August 31, 2026, alleging it computed a second-price result and then replaced it with a higher figure from an undisclosed soft reserve capped only by the winning bid. Internal reports cited in the complaint show the share of Sponsored Products clicks charged at the advertiser's own bid rising from 4% in late 2020 to 79.1% in 2024, and put the total above $20 billion across 1.2 million advertisers. Amazon's same-day response said no advertiser paid above its bid and that relevance-weighted ranking saved advertisers more than $8 billion between 2021 and 2025. The case followed FTC inquiries opened in September 2025.

Search quality is a separate complaint. The FTC's antitrust suit, filed on September 26, 2023, alleges Amazon replaced relevant organic results with paid advertisements. A less-redacted version released that November said executives were told to accept more ad "defects", Amazon's term for irrelevant ads, according to Bloomberg. Amazon spokesperson Tim Doyle said the store offers "a mix of organic and sponsored search results". A 2021 complaint from the Strategic Organizing Center, a union coalition, counted paid ads in more than a quarter of over 130,000 search results, according to Axios.

Measurement relies on the seller's own figures. Amazon first reported a 9% click-through gain for video in 2025; its product page now cites 67%, from June 2026 internal data. Conversational surfaces add pressure: research from Workflow Labs found Rufus narrows a page of about 50 results to roughly five products, shrinking what any bid can buy.

Not the same as

Sponsored Brands promotes a brand rather than a listing, with a logo, headline and several products, and was called Headline Search Ads until 2018. Sponsored Display targets audiences and product views on and off Amazon rather than search queries. Product listing ads, Google's Shopping format, are also built from a merchant feed, but the click leaves for the merchant's own site. Amazon DSP buys display, video and audio programmatically, usually priced per thousand impressions, not per click.

Recent developments

The format's reach keeps extending by default. Creators in the Amazon Influencer Program became a Sponsored Products destination on August 10, 2026, with existing campaigns enrolled at current bids and budgets in the United States, Canada, Brazil, Mexico, India, the Middle East, North Africa and Turkey, and select European Union countries. Three weeks later the FTC filed its pricing case, which Amazon disputes, placing the auction behind the largest part of its advertising revenue before a court.

Timeline

  • 2008: Sponsored listings on Amazon begin, according to the Center for Journalism and Liberty
  • 2012: Amazon Marketing Services launches, the start date most trade histories give for Sponsored Products
  • 2014: Amazon is describing its sponsored ads as a generalised second-price auction by this year
  • September 2018: Amazon Advertising replaces AMS, AAP and AMG; Headline Search Ads become Sponsored Brands
  • 2021: The business adopts the Amazon Ads name
  • December 8, 2021: Strategic Organizing Center complaint to the FTC on ad labelling in search results
  • September 26, 2023: FTC files its antitrust suit, citing paid ads in search results
  • October 2023: Sponsored Products extends to third-party apps and websites
  • January 9, 2025: Amazon launches Retail Ad Service at CES
  • January 24, 2025: IAB Tech Lab finalises the OpenRTB prodfeed extension
  • March 26, 2025: IAB Europe publishes harmonised onsite definitions naming Sponsored Products
  • July 24, 2025: Pentaleap and Teads announce real-time bidding for onsite sponsored products
  • September 2025: FTC opens inquiries into Amazon and Google search ad pricing disclosures
  • November 2025: Macy's Media Network adopts Retail Ad Service
  • November 11, 2025: Sponsored Products video launches; prompts enter free open beta
  • March 25, 2026: Sponsored Products prompts become billable in the United States
  • April 29, 2026: Amazon advertising crosses $70 billion on a trailing twelve-month basis
  • June 8, 2026: Off-Amazon ad serving column added to US bulksheets
  • July 30, 2026: Amazon reports $19.8 billion in second-quarter advertising revenue
  • August 10, 2026: Sponsored Products begins serving through Amazon Influencer Program creators
  • August 31, 2026: FTC and 22 states sue Amazon over Sponsored Products pricing

Summary

Who. Amazon Ads operates the format and sets its rules; professional sellers, vendors, KDP authors and their agencies buy it. Walmart Connect, retailers using Amazon Retail Ad Service and technology suppliers such as Pentaleap and Teads run versions elsewhere. The FTC and 22 states are now challenging how it is priced.

What. Cost-per-click ads for individual catalogue items, targeted by keyword, product or Amazon's automatic matching, ranked on bid and relevance, and styled to resemble organic listings.

When. Commonly dated to 2012, renamed within Amazon Advertising in September 2018, extended off Amazon in October 2023, into Rufus prompts in 2025 and 2026, and to creators on August 10, 2026.

Where. Amazon search results and product pages in 23 marketplaces, third-party apps and sites, creator content, the Rufus assistant, and retailer sites running Amazon's technology or equivalents.

Why. Marketplaces have more offers than visible slots, and selling that scarcity at the moment of purchase intent produces the largest single line in Amazon's advertising business, along with the transparency disputes that come with a seller auditing its own auction.