When running Amazon PPC campaigns, many sellers focus on reducing CPC (Cost Per Click) without understanding whether that CPC is truly profitable.
A low CPC can still drain your margin if it exceeds your breakeven limit. Knowing your Breakeven CPC ensures every click moves you toward profit rather than loss.

What is CPC in Amazon Advertising?

CPC (Cost Per Click) is the amount you pay each time a shopper clicks your ad.
It’s a core metric in Amazon PPC bidding strategy because it determines how much each potential sales opportunity costs.

Formula:
CPC = Total Ad Spend ÷ Total Clicks

While a lower CPC generally means cheaper traffic, it only matters if those clicks convert profitably.

Why Breakeven CPC is Critical for Profit

Breakeven CPC is the maximum amount you can pay per click and still break even after factoring in product profit and conversion rate.
If you bid above your breakeven CPC, you are effectively paying for every click with your margin.

Formula:
Breakeven CPC = Profit per Sale × Conversion Rate

Example:
If your profit per unit is $10 and your conversion rate is 10%,
Breakeven CPC = $10 × 0.10 = $1.00
Paying more than $1 per click would start eroding your profit.

Amazon CPC Benchmarks for 2025

Industry data shows that average CPCs vary by category and competition level:

• Low-competition categories (Home & Kitchen, Office Products): $0.50–$0.80

• Moderate-competition categories (Sports, Pet Supplies): $0.80–$1.20

• High-competition categories (Electronics, Supplements, Beauty): $1.20–$2.00+

How to Use Breakeven CPC in Your PPC Strategy

Once you know your breakeven CPC, you can:

• Set smarter bid caps to avoid overpaying

• Identify when to scale winning campaigns

• Reduce bids for keywords with low conversion rates

• Allocate budget to campaigns that generate the highest ROAS (Return on Ad Spend)

Breakeven CPC also acts as a safeguard when testing new campaigns, ensuring experiments do not bleed margin.