When you look at the different Amazon bidding strategies, the one that makes most of the difference is the keyword-level bidding.
Usually in an auction scenario, the person bidding the highest amount wins. However, the difference with Amazon bidding is that – although the seller who bid the highest amount for the keyword wins, but the amount that he needs to pay is what the second-highest bidder had bidden.
There are 3 different types of bids that one can opt for:
Ad groups that have both manual and automated targeting have to pay when customers click on their link from a given ad group. Bids of this kind are known as Default bids.
Suggested Bids are those bids that are displayed based on what the other advertisers have bid on. They display bids from those players who deal in the products that are similar to the ones that you are displaying. The winner of the bid is calculated on the basis of the other winning bids that are similar to your category.
The third way is through Custom bids. Here you can bid a higher amount in the start, evaluate its performance and then customize as per the need.