KDP AD CAMPAIGN
Amazon recently launched a new tool for KDP Select authors.
- Find it on your KDP Bookshelf.
- Look under the KDP Select column.
- Click the Promote and Advertise link.
- Click the Create an Ad Campaign button.
Advertising is a risk. You want to monitor your ad campaign at Kindle Direct Publishing.
And you want to know how to assess your risk. I’ll show you what, exactly, to look for.
There is a $100 minimum budget for the ad campaign and you must bid at least 2 cents.
However, once your campaign is up and running, you can click Pause or Terminate if you’re not happy with the results.
(What about the $100 minimum? Good question! They don’t bill you up front. They bill you incrementally as you get clicks. I don’t see how that $100 will get charged if you terminate the ad early, though if this concerns you, perhaps you should contact KDP support before you begin an ad.)
ASSESSING YOUR AMAZON AD CAMPAIGN
If you place an ad, you’ll want to monitor its progress.
Unless you choose to target your ad based on a small number of similar books, you’ll probably see impressions not too many hours after your ad begins.
That’s kind of cool.
Until you see hundreds of impressions, but no clicks.
But don’t worry. Impressions are free! You only pay for clicks. If I could have 1,000,000 free impressions right now, with zero clicks, I’d take it. Don’t sweat free exposure. Impressions are good.
Then you’ll notice that you’re getting very few clicks from those impressions.
Don’t sweat a tiny percentage of clicks.
You don’t pay for impressions.
You only pay for clicks.
The fewer clicks, the less money you pay.
More impressions per click actually works in your favor. That many more people saw your book without you having to pay extra.
The click-through rate (ctr) may be about 0.1%. That’s 1 click for every 1000 impressions. It varies from book to book, but it’s typical of advertising on the internet to get a ctr of about 0.1%.
Most businesses sweat the ctr because most businesses pay for impressions, not for clicks.
We don’t have to sweat the ctr because we only pay for clicks.
The number you should sweat is the conversion rate.
Take the # of sales and divide by the # of clicks. That’s your conversion rate.
The conversion rate shows you how well your ad is paying off in the short term.
Sales reporting may be delayed compared to impression and click reporting. So when you look at your ad campaign report, you may have sales on there that you don’t know about.
Also, a customer may click on your ad, but might not buy your book until a later date. The customer was busy doing something else when your ad came along. There is a good chance that the customer will add your book to your cart, if the customer wants to buy it, but wait days or weeks to actually make the purchase.
If the customer buys your book within 14 days of clicking on your ad, the sale will show in your ad campaign report. Thus, sales reporting could be delayed up to 2 weeks.
Multiply your conversion rate by your royalty. Let’s call this Z.
- If Z is less than your average cost-per-click (CPC), then you’re losing money short-term.
- If Z is greater than your CPC, then your ad is paying off short-term.
Your ad might not pay off short-term.
But that may be okay.
The question is: How close are you to breaking even short-term?
- A small short-term loss is likely to be rewarded by long-term gains.
- If you’re taking a large short-term loss, it may be in your best interest to pause or terminate the campaign.
And what about Kindle Unlimited? Suppose the customer clicks on your ad and reads it through Kindle Unlimited? Will that show up as a “sale” in the ad report? That’s a good question. Unfortunately, at this time, I don’t have the answer. But it’s something to keep in mind.
Suppose that you have:
- $2.99 list price
- $2 royalty
- 2-cent bid
- 300,000 impressions
- 300 clicks
- 3 sales
The impressions look great. But just 300 clicks out of 300,000 impressions may freak you out at first. But that’s typical. Remember, impressions are free, it’s the clicks that you pay for. The more impressions, the merrier.
Your conversion rate is the number of sales divided by the number of clicks: 3 sales divided by 300 clicks equals 0.01. Your conversion rate is 0.01 (or 1%).
The quantity I called Z is the conversion rate times your royalty: Z equals 0.01 times $2. In this example, Z equals 2 cents.
Hey, Z equals your bid.
Look, it cost you $6 for those 300 clicks. To make 300,000 impressions for a mere $6 would be a great deal.
But you only made 3 sales. However, those 3 sales earned you a royalty of $6.
You broke even. Your 3 extra sales compensated for your investment.
That’s actually very good. If you can break even short-term, it’s worth it for the long-term benefits.
Even a small short-term loss is worth taking for long-term benefits.
Don’t worry about a small ctr (i.e. very few clicks compared to impressions).
Don’t worry if sales are low, as long as your value of Z is comparable to your bid.
If your bid (CPC) is much larger than Z, then you should worry!
POSSIBLE LONG-TERM BENEFITS
Here’s why it might be worth taking a short-term loss to run an ad campaign at Amazon.
These are some possible long-term benefits:
- If you generate extra sales through the Amazon ad, if any of those customers enjoy your book enough to recommend it to others, this gives you possible long-term sales growth.
- One extra sale now might result in many extra sales later, if the customer likes your book enough to want to buy more of your books.
- A customer who clicks on your ad, but who was busy doing something else at the time, may place your book in the shopping cart and check it out days or weeks later.
- Customers who saw your ad may recognize your book the next time they see it, and, thinking, “I’ve seen this before,” may be more likely to buy your book through branding.
- Any extra sales can help improve your sales rank, which can help with exposure in many ways, such as customers-also-bought lists, improved visibility in search results, landing on bestseller lists, etc.
IMPROVING YOUR CHANCES
Following are some factors that go into whether or not your ad will come close to breaking even.
Just bid 2 cents. What’s wrong with that?
If you pay $100 for 2-cent bids, you’ll get 5000 bids if you spend the entire $100 over the course of the campaign.
If you bid higher, you get fewer clicks and fewer impressions.
Don’t bid higher unless there is some urgency with enough benefit to offset the cost. If you really need to advertise RIGHT NOW for some compelling reason, you might bid more.
Otherwise, what’s the hurry to spend your money?
Whether you spend $100 in 2 weeks or 2 months, it’s still $100 spent, right? My recommendation is to bid 2 cents.
Just take whatever clicks and impressions you’re getting, and be content with that.
Focus on Z and comparing Z to your CPC. If Z is close to your CPC, be happy.
If you raise your bid, it will be harder for Z to compete with your CPC.
A higher royalty means you don’t need as many sales for Z to match your CPC.
If you’re earning 34 cents per book with a 99-cent list price, you need 1 out of 17 clicks to result in a sale just to break even on a 2-cent bid.
If you’re earning $2 per book with a $2.99 list price, you just need 1 out of 100 clicks to result in a sale in order to break even on a 2-cent bid.
The list price does show in the ad. So more customers are likely to click on the ad if the price is more compelling.
But that’s actually not important here.
Why not? That just spends your ad money faster. It’s not how fast you get your clicks that matters. You pay for those clicks whether they come quickly or slowly.
What matters are (A) how likely the customer is to buy the book after clicking and (B) how much royalty you earn for the sale.
Maybe customers are, in general, more likely to buy a 99-cent book than a $2.99 book. But probably not in this case. Remember, they see the price before clicking on the ad. They’ve already factored in the price.
You may get your clicks faster at 99 cents, but that just means that your campaign will end sooner. It doesn’t matter how fast you get your clicks. (Unless you have major URGENCY with benefits that outweigh the added cost.)
COMPELLING PRODUCT PAGE
This is where the $$$ is whether you’re advertising or not.
People are visiting your product page.
One thing running an ad campaign will show you is that only 1 out of 1000 people who glance at your book will check it out, and only 1 out of 100 people who visit the product page will purchase it.
Well, it could be 1 out of 50 who visit your product page make the purchase, or it could be 1 out of 5000 who make the purchase.
The conversion rate is something that you can impact:
- Did the cover and title shown in your ad signify the correct genre? If not, your conversion rate will be awful.
- Does your blurb wow the customer? If yes, they’re looking inside. If not, they’re outta here. Typo in the beginning of the blurb? Facepalm!
- Does the Look Inside magnetize the customer to read the beginning? Does the beginning grab the customer and make the customer want more? Or does it bore the customer, or deliver something that wasn’t expected?
- Does the Look Inside appear professional?
- Is your book a great value? Does it appear to exceed the customer’s expectations?
- Was the book good enough to generate some good, honest reviews? (This is NOT the MAIN point.)
If you have a low conversion rate (sales divided by clicks), one of these areas can be improved.
If you improve your product page and run another ad in the future (or pause it now and resume it after making the improvement), you’ll be able to compare conversion rates and see whether or not the change appears to have any impact. One great thing about these ads is that we get valuable DATA.
One great thing about investing a little money in a KDP campaign ad is that you can find out what your conversion rate is. A rate of 1% is fairly common. If your conversion rate (sales divided by clicks) is much lower than 1%, it may be a sign that you need a more marketable book or a more marketable product page. There is something to improve. Once you make a change, you can run another ad to measure your conversion rate again. This way, ads can help you perfect the marketability of your book and product page.
ABOUT THE AD
The ad is automatic. It includes:
- your cover thumbnail
- the first few words of your title
- the average star rating (shown visually, like ****)
- the number of reviews
- the list price
A compelling ad gets you clicks faster, but you’re going to pay the same amount regardless of how fast you get your clicks. Your ad will just run out sooner if you get the clicks faster.
Yet it’s still worthwhile to make a compelling ad:
- If your thumbnail is more attractive to your target audience, that will help your conversion rate once they reach your product page.
- The more effective your ad, the better the branding impact your unclicked impressions will make.
However, the ad is pretty small. See this example:
It’s just a couple hundred pixels across.
To really stand out and aid with branding so that you benefit from all those unclicked impressions, you need:
- a cover that’s still visually attractive at super small thumbnail size
- a cover with a very simple, yet effective design
- a color scheme that sends the right message
- 2 HUGE words in your title so they can be read even in mini-mini size
- a short title so that part of it doesn’t get cut off
- enough good reviews (getting reviews is NOT the MAIN thing)
Another important factor is targeting. If you choose product targeting and research your product list well, this can improve the effectiveness of your ad.
Copyright © 2015
Chris McMullen, Author of A Detailed Guide to Self-Publishing with Amazon and Other Online Booksellers
- Volume 1 on formatting and publishing
- Volume 2 on marketability and marketing
- 4-in-1 Boxed set includes both volumes and more
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Click here to jump to the comments section:
Does Amazon put more effort into their push if the bid is higher? In other words, does a 5 cent bidder appear in more & better places?
I’m really interested in this for my next release.
I don’t know. From numbers I’ve heard though, and seen myself, I recommend 2 cents. I don’t see evidence of higher bids having greater yield.
Chris, I’ve been playing with the ads. I tried my book at .99 with a low maid, was losing money. Tried at 2.99 with slightly higher bid 0.11. Now am trying my book at 5.99 with a .21 bid. Am not selling a whole lot more but I’m making a bit of money. Tried to get my book on Bookbud a few times, but they wouldn’t take my book at .99. For the money they wanted to give it away, I can get a lot of sales on Amazon.
Thank you for sharing your experience with Amazon ads. I’ve seen a good return on higher-priced books with modest bids. Good luck with your book. 🙂
Okay, on the page where you originally set up your ad campaign, look under “Set your campaign name, bid and budget.” Click the link “How will my budget be spent.” There, it does say: “higher bids may result in higher delivery of ads and clicks, and also better quality of ad placements.” However, as I said earlier, I don’t yet have evidence to suggest that higher bidding produces better results in terms of conversions or any other stats. So far, it just seems to generate faster clicks. But if what Amazon says is true, it’s possible that higher bids do have a small impact. The danger is that a higher CPC makes it harder to break even. You are allowed to change your bid, however, so you can test a higher bid out, and if you’re not happy with the results, you can drop it back down.
I’m going to try it, but I’m waiting until my next book. I’m targeting somewhere around the equinox. That ought to give me time to observe what others are finding about the program.
Research and patience are usually helpful in advertising. Certainly, less risky. 🙂
Reblogged this on 'The Last Wave: A Near-Death Experience', EBook and commented:
With more information on the new amazon kindle ad campaign and new tracking features,I thought that I should follow up the first article by Chris McMullen with his more in depth take on this new marketing opportunity. Plus, I need these two article for easy reference.
Pinterest too has just launched pin ad campaigns, of which I have been asked to be one of the first businesses to try it. I will be posting more on my ethical internet marketing efforts and the need to open a WordPress.org blog for advertising and offering products that are an extension of my book! Please stay tuned…
Thank you for the reblog. 🙂
Sounds a little bit like Etsy promoting but more detailed! I’ll have to check that out. Thanks Chris. ~Elle
You’re welcome. I hope this is helpful. 🙂
Chris does the numbers – so I don’t have to.
Where does all that energy come from? Dunno – that’s what I would like to be able to buy, Chris, even more than clicks. Every time I turn around, you’ve analyzed another feature for me.
Mighty obliged, sir!
Any comments on fiction vs. non?
Once you get busy, it’s hard to get unbusy.
I can imagine ads being competitive in popular genre fiction. I don’t think higher bids will solve that problem. Maybe patience and finding effective ways to use product-based targeting.
Either way, I expect the main benefits, if any, to be long-term, and so will be happy to break even with the ads short-term. I don’t count on even this though. The proof will be in the numbers.
Reblogged this on Chris The Story Reading Ape's Blog….. An Author Promotions Enterprise! and commented:
AUTHORS – In case YOU are ALSO wondering HOW 😀
Thank you. 🙂
this is great chris. I’ll come back to it when my book is on the market.
I’m glad it may have been helpful. 🙂
Very useful and very timely Chris!
I’ve been planning to test this new tool myself and blog about it on Readers in the Know. Now, when I do, I’ll be able to link to this for the campaign measurement part.
Besides researching it, have you actually tried it out for yourself? If so, may I ask what kind of ROI you got – i.e. what value you got for Z?
I have five ads going on different books (including pen names) with different targeting and bids for comparison. But since this just started, I don’t yet have enough data for meaningful statistics. Speaking with others, reporting seems to show stalls and delays, and may be a bit buggy right now. But eventually the data will come. 🙂
Thanks for this helpful information, Chris.
I’m glad it was helpful. 🙂
Thanks for the helpful information. I’m trying out the ad campaign with “Shedding Light On Murder,” the first book in my series. I don’t seem to be getting what I would consider very many impressions, let alone clicks. Any thoughts on impressions and how to get more? Once you start, you can’t change keywords.
You don’t actually get to associate keywords with your ad. Rather, you can enter keywords to help you find similar products to target. The ad doesn’t save or use those keywords, but if you select product targeting, it will use the targets that you choose after doing the keyword search.
You get to choose between interest targeting (a broad category) or product targeting. If you choose product targeting, you can edit your campaign and update your list of products to target. But if you choose interest targeting, you can’t edit the targeting at all.
You can’t do both interest and product targeting. If you select interest targeting, then your targeting is based solely on the category that you choose.
If you currently have interest targeting and would like to switch to product targeting, simply pause or terminate your current campaign and start a new one.
Increasing the number of products selected in product targeting, including other relevant products like movies, can help your ad generate more impressions. Another factor is increasing your bid, though this option will get you fewer clicks for your budget. A third factor may simply be patience. Many authors are bidding high presently because the tool is new, and the average bid is likely to down over the course of the coming weeks. Good luck with your books.
Thanks, Chris. I am considering your suggestion to terminate and re-start campaign to try different targets. I did try increasing my bid, but so far, no change. In any case, it’s hard to determine at this point what a good number of impressions is. And, like you suggested, it may have an impact sometime in the future.
Good luck with your books too and I’m looking forward to hearing more from you.
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Thanks for the well-explained info, Chris. It’s a shame for us in the UK that it’s only possible to run a campaign in the US. But hopefully it won’t be too long before we can run adverts on Amazon.uk.
Many other features seem to make it to the UK in time. Hopefully this will be one of those. 🙂
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I have just begun an ad for The Tear Vessel and cannot work out what an impression is as opposed to a click.
An impression is when your ad appears on a product page. A click is when a customer clicks on your ad. Good luck with your book.
Does this mean you don’t see your own ad on the page but it is elsewhere?
It means that most people who see the ads don’t click on them.
My ad campaign is product based averaging .10/click. I’m getting the industry standard. 1/click per 1,000/impressions. I’m averaging 2,000/impressions a day. I think that’s good. My trick is to target products similar but non-traditional. And, believe me, I’ve targeted nearly 800 products! Interest based campaign was 178/impression w/no clicks over one week. I’d probably have to bid .50/click to touch this category. It’s not worth it. You can run two campaigns side by side for the same book and try each. That’s what I did.
It’s definitely worth researching a targeting list. As you note, this can help you reach your specific target audience without having to bid as much. I presently have several ads with 5 to 10 cent bids, some of which generated several thousands of impressions over the past week (and a few sales).
That’s a good idea to run two campaigns simultaneously for the same book (as long as the targeting isn’t similar enough that your own campaigns might bid against one another). Good luck with your ad. 🙂
I have had no clicks, I thought it would be on the British site as well (as I live in UK) and don’t understand how it works as I have just changed the duration to the farthest I could. Can anyone tell me what I have done wrong and if I can edit it? I have had only excellent reviews – 11 in UK and 4 in US and know this would make a great film. How do I get it to the right places? Help please…does the $100 last until it is gone or is there a deadline? I obviously do not have a business brain.
Units Sold –
Campaign Name trisha’s Account 04/06/2015
Book THE TEAR VESSEL
Ad Locations Detail pages on Amazon.com
Targeting Type Interest-based
Targeted Interests Literature & Fiction; Travel; Mystery, Thriller & Suspense; Romance; Biographies & Memoirs
CPC Bid $0.02
Duration 04/06/2015 – 11/04/2015
Pacing Deliver my campaign as quickly as possible
It’s really hard to get impressions with interest targeting in fiction, especially with a low CPC bid. There are just too many authors of fiction books competing in the same interests. Most fiction authors have had better success with product targeting, selecting upwards of 1000 products to target that are highly relevant for their books. Some have selected relevant movies and other products besides books. Some have targeted less popular books, too (because many other authors will target the most popular books in the genre). It’s also not easy to get impressions with a 2-cent bid. That being the minimum, every other ad will outbid yours. Though I do believe in trying to keep the CPC bid as low as possible. Presently, I have a few ads with 5-cent bids which are making tens of thousands of impressions (but in nonfiction).
Your $100 investment isn’t a commitment. You’re free to pause or terminate your ad at any time. If you want to make changes, you just have to terminate that ad and start a new one.
Presently, AMS is only available in the US. That may change in the future. Good luck with your ad.
Can you explain what you mean by products? The story is based on truth and takes place on a yacht in many places around the world. I have no idea what is meant by products.
I meant instead of interest targeting where you target categories, choose product targeting where you get to select specific books.
How many sales out of the clicks have you had?
Same question just forgot to ask for email notification!
How many sales out of the clicks have you had?
Sorry about repeats but want to be notified if there is a reply.
Thanks Chris for the wonderful blog. Very useful.
Thank you for the kind words. 🙂
Hi Chris, really interesting. Thanks. I guess it still isn’t available on the UK Amazon site as I have looked but couldn’t see anything.
That’s right: AMS hasn’t yet opened up KDP Select advertising to the UK.
Chris, do you know if there is a limit on the number of impressions that you can get per book? I’ve tried everything to increase my impressions, but can’t seem to get anywhere. Thanks.
Apparently there isn’t a limit. I have 15 different ads with millions of impressions each.
Yeah, I’m sure they’ll let it run forever. But what about a daily limit? Amazon is huge, but they don’t have infinite ad space, so I guess it would make sense. I can’t seem to crack more than about 18k impressions in a day. I also have multiple ads for one book and adding new ads does nothing to crack the 18k. Any insights?
I haven’t seen any reason to suspect a daily limit. My numbers vary widely from one book to another. Before they rolled out pay per click advertising, they used to sell 10 million clicks spread over a month, though back then there weren’t as many ads competing for space (though there were also many fewer ads showing on a product page or in search results). Ad performance, based on your click through rate, for example, seems to be a strong factor in earning impressions, though it’s not easy to improve. Good luck with your ads.