AMS Ads: Master Amazon Advertising in 2027

Did you know that Amazon Ads can drive up to 326% ROAS and significantly increase new customer acquisition? Mastering AMS is essential for e-commerce success in 2027.

What is Amazon Marketing Service (AMS) and How Does It Work?

Amazon Marketing Service, now often called Amazon Ads, is Amazon's self-service platform that offers a suite of ad types designed to boost product visibility and sales. It revolves around PPC (pay-per-click) campaigns that utilize targeting and keywords to reach high-intent shoppers.

In 2027, AMS has evolved into a full-funnel strategy integrating Sponsored Products, Sponsored Brands, Sponsored Display, and Amazon Marketing Cloud (AMC). Trends show a shift toward AI-driven optimization and cross-channel synergy, making it vital for sellers to adopt these new capabilities.

Overview of Amazon Ads in 2027

AMS now includes a comprehensive set of tools: Sponsored Products for search intent, Sponsored Brands for brand awareness, Sponsored Display for retargeting, and AMC for audience segmentation. These components work together to create a cohesive advertising ecosystem.

Full-funnel strategies are more prevalent, combining awareness campaigns via DSP (Demand-Side Platform) with conversion-focused Sponsored Ads. The emphasis on AI-powered optimization helps sellers refine targeting and bids dynamically.

Evolution and Industry Significance

From simple search ads, AMS has grown into a complex system that offers detailed analytics and attribution. In my experience working with authors and brands, integrating AMC has led to an 80.2% increase in NTB (new-to-brand) revenue contribution.

This evolution has driven significant e-commerce growth, with companies leveraging advanced targeting and creative formats like video ads to capitalize on shopping behavior trends.

Types of Ads Available Through AMS

AMS offers various ad types, each suited for different goals and stages of the customer journey. Managing bids and budget effectively across these types is crucial for maximizing ROAS.

Analytics tools help monitor performance metrics, enabling continuous optimization. Let's look at each ad type in detail.

Sponsored Products

Sponsored Products are high-intent, search-based ads that appear on product pages and search results. They are ideal for driving immediate conversions and sales, especially when optimized with relevant keywords.

In 2025-2026, brands saw ROAS improvements of up to 8.2x using Sponsored Products, especially when combined with auto campaigns for keyword harvesting.

Sponsored Brands

Sponsored Brands showcase multiple products and direct shoppers to a brand store page. They are effective for brand awareness and cross-selling, especially during peak seasons. For more on this, see our guide on developing reader loyalty.

Targeting strategies here include keyword and product targeting, with creative formats emphasizing video ads to boost engagement.

Sponsored Display Ads

This ad type focuses on display retargeting and audience segmentation to re-engage shoppers who viewed or abandoned carts. It often yields strong ROAS, with some campaigns hitting 8.2x.

Using Sponsored Display for cart abandonment recovery and audience targeting enhances conversion rates and complements Sponsored Products and Brands.

Amazon Marketing Cloud and DSP

AMC provides advanced audience insights and custom targeting, enabling campaigns based on shopping behavior and other data points. It supports top-funnel awareness campaigns with AI-powered optimization.

In 2026, integrating Amazon DSP with AMS has become standard for brands seeking full-funnel coverage and detailed analytics.

How Does Amazon Marketing Services Work?

AMS operates through targeted bidding and campaign setup within the advertising console, a user-friendly self-service platform. Bids and budget allocations are adjusted based on performance metrics to optimize ROAS and reduce waste.

In my experience, segmenting keywords by funnel stage—awareness, consideration, and conversion—helps refine targeting and bid strategies, ensuring efficient ad spend.

Targeting and Bidding Strategies

Effective targeting involves segmenting keywords and audiences to match the shopping behavior at each funnel stage. Auto campaigns help with keyword harvesting, which can then be transitioned to exact match for efficiency.

Adjust bids based on ad placement, device, and audience data. For example, increasing bids on top-performing keywords or audiences can improve ad placement and overall ROAS.

Campaign Setup and Optimization

Leverage tools like Intentwise for bulk campaign management and real-time analytics. Testing creative formats—especially video ads—can outperform static ads by over 2x CTR.

Automating review requests and optimizing keywords regularly are critical for maintaining visibility and reducing TACoS (total advertising cost of sales). For more on this, see our guide on use goodreads effectively.

Full-Funnel Approach and Multi-Channel Synergy

Combining DSP for awareness with Sponsored Ads for conversion creates a cohesive funnel. Using Amazon Attribution helps connect external traffic from Facebook or Google to Amazon sales, providing a clearer picture of impact.

Setting Up and Managing Amazon Sponsored Ads

Campaign creation begins in the advertising console, where defining clear objectives like ACoS targets and ROAS benchmarks is essential. Selecting appropriate ad types aligned with goals ensures better results.

Monitoring performance metrics daily allows for quick adjustments. For instance, if a keyword isn't performing, negative keywords can reduce waste and improve overall ROAS.

Campaign Creation in Amazon Advertising Console

Start by setting campaign goals and choosing ad types—Sponsored Products, Brands, or Display. Use data from previous campaigns or auto campaigns to inform bid and budget decisions.

Regularly review performance metrics like CTR, conversions, and ACoS to fine-tune bids and budget allocations, especially during peak seasons.

Budget Allocation and Scaling

Typically, about 35% of the budget should go toward DSP, with the remaining 65% focused on Sponsored Ads. During peak seasons, scaling up by harvesting keywords from auto campaigns can maximize reach.

Aiming for a full-funnel split—around 35% top-of-funnel and 65% bottom-of-funnel—ensures balanced growth and sales conversion.

Creative and Keyword Optimization

High-quality video creatives outperform static ads, increasing engagement and conversions. Regularly refreshing keywords and negative keywords reduces waste.

Targeting reviews and ratings—aiming for 50+ reviews per SKU—improves organic rankings and ad performance.

Measuring ROI and ROAS in Amazon Ads

Key metrics include ROAS, TACoS, and audience targeting effectiveness. A ROAS of 3.85 remains a strong benchmark in 2027, indicating profitable campaigns.

Utilizing tools like Amazon Attribution and third-party platforms such as Intentwise enables data-driven optimization and better understanding of the customer journey.

Key Metrics and Benchmarks

Monitoring ROAS, TACoS below 3%, and ad placement performance helps refine campaigns. Multi-touch attribution reveals true lift and helps justify ad spend increases. For more on this, see our guide on author mentorship programs.

In my experience, tracking Search Query Performance (SQP) allows continuous keyword refinement, boosting ROAS over time.

Tools and Data-Driven Optimization

Platforms like Intentwise provide real-time analytics and bulk optimization features, saving time and improving performance metrics.

Incrementality testing proves whether ads are driving new customer acquisition or just cannibalizing organic sales, which is crucial for cost management.

Common Challenges and How to Overcome Them

High ACoS and wasteful spending are frequent issues. Regularly reviewing and harvesting auto campaign keywords into exact match reduces waste.

Integrating Amazon Attribution helps close attribution gaps, while automation platforms like Xnurta streamline bid adjustments and reporting, saving over 40 hours weekly.

High ACoS and Wasteful Spending

Implement funnel-based bidding and negative keywords to target high-converting audiences. Regular SQP review and external traffic data inform bid adjustments.

This approach often reduces ACoS from 38% to 26% within a few months, significantly improving profitability.

Attribution and Tracking Gaps

Use Amazon Attribution combined with multi-touch attribution models to get a holistic view of ad performance across channels. This insight helps optimize audience targeting and ad placement.

Accurate attribution is vital for cost management and proving ad effectiveness to stakeholders.

Time Management and Automation

Platforms like Intentwise and Xnurta automate bulk campaign operations, bid management, and reporting. This saves over 40 hours weekly, freeing up resources for strategic planning.

Automation also reduces human error, ensuring consistent optimization.

Siloed Channels and Lack of Synergy

Implement full-funnel strategies and cross-channel measurement to demonstrate how Amazon Ads contribute to overall sales. Testing incrementality helps prove the value of Amazon advertising investments.

This integrated approach leads to better budget allocation and improved ROAS.

Latest Industry Trends and Standards for 2027

AI and machine learning advancements are transforming AMS, with AWS tools enabling real-time ML on over a billion products and billions of shopping behavior data points. Auto-scaling reduces costs without sacrificing performance. For more on this, see our guide on self publishing income.

Performance benchmarks like TACoS below 3% and ROAS of 3.85 are standard targets for mature campaigns. Full-funnel strategies, combining DSP and Sponsored Ads, remain industry best practices.

AI and Machine Learning Advancements

Amazon utilizes AWS ElastiCache and Kinesis to process massive datasets instantly, enabling dynamic bidding and audience segmentation. These innovations support personalized ad experiences and better targeting.

In my testing, AI-driven automation consistently improves ROAS and reduces cost management challenges.

Performance Benchmarks and Goals

Setting clear goals such as TACoS below 3% and ROAS above 3.85 helps maintain focus on profitability. Full-funnel approaches, including video ads, enhance shopping behavior engagement and conversions.

During 2026-2027, top brands are adopting these standards to stay competitive.

Future Focus: Privacy, Video, and Cross-Market Expansion

With rising privacy concerns, Amazon is emphasizing privacy-safe insights and advanced audience segmentation. Video ads now dominate display impressions, generating higher engagement and conversions.

Expanding into new marketplaces and leveraging video creatives are key to maintaining growth in 2027.

Key Statistics and Success Stories in 2027

Wind River's use of AMC led to an 80.2% increase in NTB revenue contribution. Ecom Brainly generated $2.5 million over 8 months, with 233% monthly growth during peak season. Electronics brands doubled sales from $1.6M to $3.2M, with DSP boosting conversions by 42%.

OptiMine jewelry retailer achieved a 326% ROAS, proving the effectiveness of cross-channel measurement and audience targeting. Wisconic kitchenware experienced 58% YoY growth, driven by full-funnel strategies and video ads.

Video creatives outperform static ads by 2.3x CTR, emphasizing the importance of visual content in Amazon advertising.

Conclusion and Final Tips for Success in 2027

In 2027, mastering AMS requires a full-funnel mindset, leveraging automation, and embracing AI-driven optimization. Focus on audience targeting, creative testing, and precise measurement to maximize ROAS and reduce TACoS.

Always stay ahead by adopting new ad formats like video and expanding across marketplaces. Regularly review analytics, refine bids, and test incrementality to ensure sustained growth and profitability.

For more advanced strategies, consider exploring 7 Steps to Developing Reader Loyalty Programs That Work and stay updated with industry standards.