Overview

Amazon's average cost-per-click has climbed to $1.12 in 2025, marking a 15.5% increase from $0.97 a year ago. Data from Ad Badger highlights intensifying competition across the marketplace, with CPCs up 58% over five years. For sellers navigating tighter margins, these numbers demand a closer look at advertising strategy and budget allocation.

What the Latest Data Reveals

• CPC averaging $1.12 — A $0.15 year-over-year increase affecting ad budgets across nearly every product category on Amazon.
• Seasonal range of $0.96 to $1.19 — Costs bottomed out early in the year and peaked during Q3 and Prime Day, a 24% swing from low to high.
• 58% five-year increase — Pre-2020 average CPC was just $0.71, meaning today's advertising environment is fundamentally more expensive.
• ACOS steady at 29.6% — Despite rising click costs, Advertising Cost of Sales has held relatively flat, suggesting sellers are offsetting higher CPCs with better targeting and conversions.
• Conversion rate at 11.1% — Amazon ads continue converting at roughly 11 times the rate of typical e-commerce sites, where the average hovers around 1.33%.

How the CPC Auction Drives Pricing

Amazon uses a second-price auction model. If a seller bids $3.00 on a keyword and the next highest bid is $1.00, the winner pays $1.01 — just one cent above the competition. Rising CPCs therefore reflect growing seller competition, not Amazon arbitrarily raising prices.

Several factors influence what any individual seller pays. Category saturation is significant — niches like supplements and consumer electronics consistently run well above the platform average. Keyword type matters as well. Broad generic terms attract more competition and higher costs, while specific long-tail keywords with clear buyer intent often cost less. Placement type also plays a role, with top-of-search positions commanding premium rates compared to rest-of-search or product detail page spots.

The Broader Performance Picture

CPC tells only part of the story. The average click-through rate on Amazon ads sits around 0.50%, translating to roughly one click per 200 impressions. Sellers with optimized listings — strong images, compelling titles, and solid review profiles — frequently push CTR above 1%, which dramatically improves ad spend efficiency.