Marketing strategies and compliance for Amazon sellers

Advertising strategies

A 2025 marketing plan should combine multiple Amazon advertising tools and data‑driven techniques.  Canopy Management’s July 2025 advertising guide outlines ten key strategies, including the following highlights:

• Sponsored Brands campaigns: Amazon’s new low‑priced “Haul” mobile shopping channel increases competition for attention.  Sponsored Brands ads appear in the header of search results, occupy significant mobile real estate and feature custom creative images.  They can generate a 9.5 % sales conversion rate when properly targeted, making them ideal for brand awareness and product reach.
• Focus on product profitability: Before increasing ad spend, analyse each SKU’s cost to promote, manufacturing cost, selling fees and profit margin.  Prioritise ads for products with higher margins to maximise return on ad spend.
• Understand advertising cost of sales (ACoS): ACoS is calculated as (ad spend ÷ ad revenue) × 100 %.  The break‑even ACoS occurs when advertising costs equal your profit margin.  A low ACoS is not always best; new product launches may benefit from higher ACoS to maximise visibility.
• Use negative keywords: Adding negative keywords prevents ads from displaying for irrelevant searches, reducing wasted spend and protecting conversion rates.  For example, a seller of over‑ear headphones might add “earbuds” as a negative keyword to avoid mismatched traffic.
• Select match types wisely: Amazon offers broad, phrase, exact and negative match types.  Broad match casts a wide net for discovery; phrase match targets descriptive queries; exact match requires the keyword to match the search exactly; and negative match blocks unwanted terms.
• Optimise bids: Review keywords every few weeks and adjust bids based on performance.  Use automatic targeting to discover new search terms and test phrases before fully committing.  AI‑based dynamic budget allocation can distribute spend across campaigns to maximise profitability.
• Sponsored Display ads: Sponsored Display campaigns target shoppers based on browsing behaviour on and off Amazon, provide retargeting capabilities, and use cost‑per‑thousand‑viewable‑impressions pricing.  Sellers using Sponsored Display ads often see twice the impressions and 50 % more clicks on their listings.
• Cancel ineffective campaigns: Monitor campaigns regularly and shut down underperforming ads.  Remove keywords that generate clicks without conversions and consider discontinuing products that require excessive advertising to sell.
• Explore Amazon DSP: Amazon’s Demand‑Side Platform (DSP) provides programmatic advertising using Amazon’s first‑party shopper data.  It offers contextual and behavioural targeting across Amazon and third‑party sites.  Managed service via Amazon requires high budgets, while agencies offer more flexible options.

Advertising should be part of a broader marketing strategy that includes external traffic (social media, email marketing and influencers) and a focus on product quality and customer experience.  High seller ratings, fast shipping and competitive pricing increase the chance of winning the Featured Offer (Buy Box).  To win the Buy Box, sellers should maintain high seller metrics and offer competitive pricing and fast shipping times.

Compliance and restricted products

Staying compliant with Amazon’s policies is critical.  Listing restricted products without approval can lead to account suspension and inventory destruction.  Red Stag Fulfillment’s 2025 restricted‑product guide explains that Amazon restricts or prohibits certain products to protect customers and comply with laws.  Sellers need to distinguish between restricted items (allowed only with Amazon’s prior approval) and prohibited items (never allowed).  Understanding this difference influences product sourcing decisions.

Amazon categorises products into open, restricted and prohibited categories.  Within restricted categories, there are varying approval requirements – some require simple documentation, while others demand third‑party testing and ongoing compliance monitoring.  Restrictions also vary by region: a product permitted in the U.S. may be banned in the EU, and vice versa.  Sellers must check local regulations and Amazon’s marketplace rules before listing items, especially for categories like supplements, electronics, automotive parts or beauty products.  Restricted categories often require invoices from authorised distributors, safety certificates and proof of regulatory compliance.

The reasons behind Amazon’s restrictions include safety, legal compliance, and brand reputation.  Government agencies like the U.S. Consumer Product Safety Commission (CPSC) treat Amazon as a distributor, which makes the company liable for product safety.  Agencies such as the Environmental Protection Agency (EPA) regulate pesticides, and because the FDA does not pre‑approve dietary supplements, Amazon imposes its own rules.  Regulations like California’s Proposition 65 and the EU’s REACH and General Product Safety Directive require specific warnings and certifications.  Violations can lead to removal of listings, destruction of inventory, fines or permanent account suspension.  Therefore, always check product eligibility and obtain necessary documentation before sourcing.

Sellers should monitor Amazon’s policies regularly because the list of restricted products evolves.  Amazon may add new categories or tighten requirements in response to regulatory changes, safety incidents or counterfeit reports.  Building a compliance system – including product vetting, invoice storage and periodic policy checks – helps avoid surprises and protects your account.

Final thoughts

Success on Amazon requires more than listing a product.  Sellers must continuously optimise listings, leverage the most appropriate fulfillment method, advertise strategically and adhere to Amazon’s ever‑changing rules.  By following evidence‑based practices – from constructing keyword‑rich titles and bullet points to analysing advertising metrics like ACoS – entrepreneurs can maximise visibility and profitability.  Equally important is building a robust compliance program that recognises the difference between restricted and prohibited products and meets documentation requirements.  With the right strategy, selling on Amazon can be a scalable and rewarding business.

‍