1. To avoid CPC Rush (and thus control ACoS)
Amazon refreshes the budget for all the advertisers at sharp midnight. Due to this, the competition is highest for the initial few hours of the day as none of the advertisers are out-of-budget and thus, CPC (cost-per-click) is also high. This phenomenon of high CPCs during the initial few hours of the day is commonly referred to as CPC rush. As the day progresses, advertisers with limited budgets start running out of budget which in turn brings the CPC down. One of the strategies that Amazon PPC advertisers use is to simply turn their campaigns off for the initial few hours (e.g, midnight – 6:00 AM) and start their ads once the smaller players are out of the race and the CPC has settled down. This gives them an extra advantage to use their spending wisely and control the ACoS for their campaigns.
2. To control Ad Spends (and avoid going Out of Budget)
Advertisers with budget constraints (especially in categories with high CPCs), find it difficult to keep their campaigns active throughout the day. Due to high CPC, their budgets get completely exhausted well before the end of day (usually around 3pm or 4pm). Thus, they tend to miss the period when shoppers are more likely to convert. To avoid this, they use dayparting and turn the campaigns off at low response time-frames – generally the initial few hours of the day (12 AM – 6 AM) and in some cases the core office hours (12 PM – 04 PM) during weekdays.