The bidding rule adjusts your keywords and targets bids to achieve your target ACOS.
Navigation: Automation > Bidding Rule
How does the algorithm work?
1. The system takes 30 days of keyword statistics, skipping the past 2 days to allow Amazon data to be updated. These are the current default settings, which can be customized according to your needs.
Note: You can analyze up to 365 days of historical data and customize the number of days to skip.
Learn how the Bidding Rule analyzes historical data: How Do Algorithms Analyze Data?
2. The system aggregates keyword statistics in its own Ad Groups, calculating the ACOS of each keyword.
3. If you add a bidding rule to an Ad Group, the algorithm will adjust the keywords bid to meet the rule’s target ACOS.
4. The algorithm calculates how many bids to adjust for each keyword to meet the target ACOS.
5. Whenever the algorithm executes, it adjusts the bids a little at a time, depending on the assigned rule.
For example, the algorithm calculates a keyword optimum bid at $1.50. If the current bid is $2 and the rule allows a maximum 2% reduction, the algorithm will reduce the bid to $1.96 when it executes.
When the algorithm runs the next day, it will reduce the keyword bid from $1.96 to $1.92. This process will continue every day until the keyword reaches the target ACOS.
This gradual progression (in bid adjustment) ensures that a new keyword with an unsustainable result (Etc. 1 click, 1 sale, 100% conversion) does not overbid too quickly and overspent the advertising budget.
It also ensures a keyword does not drop its bids too quickly to the point it doesn't get any impression anymore.
