Negative Keyword Strategy: Cut Amazon PPC Costs Without Losing Reach
Last updated: February 5, 2025
Reading time: approx. 7 minutes
When you optimize Amazon PPC campaigns, much of the focus is on the right keywords: which search terms drive sales? For which terms is it worth raising your bid? Yet one of the most powerful levers is often overlooked — negative keywords.
In this guide we'll show you how to use negative keywords strategically in your Amazon advertising campaigns without accidentally cutting off valuable reach. You'll learn when to add negative keywords, which match types you can use and how to build a systematic negative keyword strategy.
Table of contents
The underrated problem: wasted spend in Amazon PPC
Every click on your Amazon ad costs money — regardless of whether the customer ends up buying or not. The problem: not every click is a good click. If your product is a premium espresso maker and someone searches for “cheap coffee filter”, the likelihood of a purchase is low. You pay for the click, but the customer was never your target audience to begin with.
The scale of the problem
Across many accounts, we at HORAiZON ONE see that 20 to 40 percent of advertising budget goes to search terms that generate clicks but bring few or no conversions. These are costs that flow straight into your ACoS without contributing to revenue.
This is exactly where negative keywords come in: they prevent your ads from being shown for irrelevant search queries — and save you real money in the process.
What are negative keywords and how do they work?
Negative keywords are search terms for which your ad should not be shown. In effect, you're telling Amazon: “If someone searches for this term, don't display my ad.” That sounds simple, but it's one of the most effective tools for campaign optimization.
The two match types for negative keywords
Negative phrase match
Excludes all search queries that contain the exact word sequence.
Example: “gift set” as a negative phrase blocks “coffee gift set”, “gift set coffee”, “gift set premium”
Negative exact match
Excludes only the exact search query.
Example: “coffee gift set” as negative exact blocks only this precise term — not “gift set coffee”
Important: choosing the right match type is crucial. A negative phrase keyword set too broadly can accidentally block relevant search queries. A negative exact keyword set too narrowly, on the other hand, lets many irrelevant variations slip through.
The golden rule: data-driven, not gut-driven
Many sellers add negative keywords based on assumptions. They think to themselves, ‘That definitely doesn't fit my product’ — without ever having looked at the data. That often leads to profitable search terms being excluded. The search term reports should always be the basis for every decision.
Thorsten MüllerCEO at HORAiZON & Amazon Ads expert
The search term report is your most important data source. It shows you exactly which search queries led to impressions, clicks and sales. In our in-depth guide to the search term report we walk you through, step by step, how to analyze it systematically.
When should a search term be made negative?
Beware of hasty exclusions!
A single click without a sale is no reason to exclude a term — that could be coincidence. Wait until you have a statistically reliable basis.
Building a systematic negative keyword strategy
A well-thought-out negative keyword strategy follows a clear process. At HORAiZON ONE we work with a three-stage approach:
Stage 1: Preventive exclusion
Exclude obviously irrelevant terms even before launching the campaign.
Examples: for premium products, “cheap”, “budget”, “under 10 dollars”. For replacement parts for one brand: competing brand names.
Stage 2: Ongoing analysis of the search term reports
The real work begins after the campaign launches.
Recommendation: at least a weekly analysis of all active campaigns.
Stage 3: Negative keyword lists at the account level
Amazon lets you create central lists that can be assigned to multiple campaigns.
Recommendation: one universal list + category-specific lists.
Typical candidates for negative keywords
Competitors & brands
- Competing brand names
- Product names of other manufacturers
- Brand-specific searches
Price-related terms
- “cheap”, “budget”, “discount”
- “free”, “no cost”
- “under X dollars”, “deal”
Other product categories
- Related but ill-fitting products
- Accessories you don't offer
- Replacement parts or repair
Informational searches
- “how does it work”, “instructions”
- “comparison”, “test”, “reviews”
- “tutorial”, “how to”
We analyze the search term reports of all active campaigns at least once a week. In doing so, we identify terms with high clicks and low conversions. These are then either added as a negative keyword or — if they do show potential — watched more closely.
Tim KraseCTO at HORAiZON
Preserve reach: don't accidentally exclude too much
The most common mistake when handling negative keywords is being too aggressive. Every excluded keyword potentially reduces your reach. Sometimes it's precisely the unexpected search terms that lead to profitable sales.
A real example from our work
A client sold high-quality pans and wanted to add “cheap” as a negative keyword. The analysis, however, showed that the search term “cheap pan test” did in fact lead to conversions — customers were apparently researching why cheaper alternatives performed worse, and then buying the premium product. Had we excluded “cheap” broadly, these sales would have been lost.
The rule of thumb
Use negative exact match for specific terms, and negative phrase match only when you're sure the entire group of terms is irrelevant. When in doubt, exclude more granularly.
Negative keywords in concert with campaign structure
Negative keywords also play an important role in cleanly separating automatic and manual campaigns. When you use keyword harvesting to move profitable search terms from your auto campaign into a manual campaign, you should add those terms as negative keywords in the auto campaign at the same time.
Why does this matter?
Without this exclusion, both campaigns compete for the same search term — a classic case of keyword cannibalization. In the worst case this drives up your costs and makes performance analysis harder. With clean exclusion you ensure that each campaign serves its clear purpose.
The division of labor:
Practical example: negative keyword optimization in three steps
Imagine you sell a premium fully automatic coffee machine for 800 dollars. After four weeks, you analyze your search term reports and find the following situation:
| Search term | Clicks | Sales | ACoS |
|---|---|---|---|
| fully automatic coffee machine | 450 | 12 | 28% |
| fully automatic coffee machine delonghi | 85 | 0 | - |
| coffee machine under 100 dollars | 62 | 0 | - |
| fully automatic coffee machine test winner | 34 | 3 | 22% |
| fully automatic machine used | 28 | 0 | - |
| fully automatic coffee machine deal | 41 | 1 | 95% |
The analysis:
“fully automatic coffee machine delonghi”
Brand search for a competitor → add as negative exact
“coffee machine under 100 dollars”
A different audience by price → add “under 100 dollars” as negative phrase
“fully automatic machine used”
You only sell new units → add “used” as negative exact
“fully automatic coffee machine deal”
Keep watching — one sale on 41 clicks could be coincidence, but the high ACoS is concerning
Through these targeted exclusions you reduce irrelevant clicks and improve your overall ACoS without losing the search terms that work.
Avoiding common mistakes
To wrap up, here are the most common mistakes we see with negative keywords:
Excluding too early
A search term with three clicks and zero sales is no case for immediate exclusion. Wait for more data.
Excluding too broadly
“Gift” as a negative phrase can also block relevant terms like “gift for coffee lovers”.
Not maintaining them regularly
Negative keyword lists are not a one-time setup. The market and search behavior change — review your lists at least monthly.
Moving keywords without excluding them
When profitable keywords are moved from auto to manual, they must be made negative in the auto campaign — otherwise your own campaigns compete with each other.
Not using central lists
Individual exclusions per campaign quickly become hard to manage. Central negative keyword lists are more efficient.
Conclusion: negative keywords as an efficiency booster
Negative keywords are not a side topic of campaign optimization — they're a fundamental lever for profitable Amazon advertising. Used correctly, they lower your ACoS, reduce wasted spend and make sure your budget lands where it has an impact: with purchase-ready customers.
The key lies in balance. Too few negative keywords mean wasted budget. Too many unnecessarily limit your reach. With a data-driven, systematic strategy you find the optimal balance.
Your main takeaways:
- Negative keywords prevent your ads from being shown for irrelevant search queries and thus lower your ACoS
- Use the search term report as your data foundation — never decide based on assumptions
- Choose strategically between negative exact and negative phrase match — exclusions that are too broad can cost valuable reach
- Create central negative keyword lists for more efficiency and consistency across all campaigns
- Make negative the search terms you move from auto to manual campaigns, to avoid double serving
Eliminate wasted spend and lower your ACoS?
HORAiZON ONE analyzes your search terms automatically and identifies candidates for negative keywords — based on real performance data.
Try it free nowFurther reading
Frequently asked questions about negative keywords
About the author
Thorsten Müller
CEO at HORAiZON & Amazon Ads expert
Thorsten and his team have already helped hundreds of Amazon sellers lower their advertising costs through systematic negative keyword strategies.