Keyword targeting reaches shoppers by what they type; product targeting reaches them by what they are already looking at. Keyword targeting should be the primary engine for most accounts because search intent is explicit and measurable. Product targeting earns its place in two specific jobs: placing your ad on competitor listings you can beat on price, rating or format, and defending your own detail pages against competitors doing the same to you.
Where product targeting genuinely wins
Attacking a specific weaker competitor. If you have an advantage a shopper can see from the ad — better rating, more units, a stronger price — appearing on that listing is a direct comparison.
Defending your own pages, which is usually cheap because your relevance on your own listing is high.
Complementary products: targeting the item your product pairs with reaches a shopper mid-purchase, often better intent than a generic keyword.
Where it disappoints
Category targeting with broad refinements behaves much like an untuned automatic campaign — many impressions across thousands of ASINs, most irrelevant. It needs the same negation discipline, applied to ASINs.
Targeting stronger competitors rarely works. If the listing you appear on has more reviews and a better price, you are paying to advertise their product to their shopper.
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